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Average new-vehicle transaction price hits a whopping new peak in December

Elevated prices for products and higher borrowing rates led to record high transaction prices for new vehicles in December, with the average cost in the U.S. rising to a record $49,507, according to data from Kelley Blue Book released today. The report notes that ATPs — average transaction prices — have climbed above suggested retail prices — MSRPs — for more than a year. Sales volumes were up in December on a year-over-year basis by more than 5%, a situation Kelley attributed to improved supply. Overall sales for 2022, however, were off 8% year over year. “The transaction data from December clearly indicates overall prices showed no signs of coming down as we headed into year-end,” said Rebecca Rydzewski, research manager of economic and industry insights for Cox Automotive. “Luxury prices fell slightly in December, but non-luxury transaction prices were up. Truck sales were particularly strong last month, and with many trucks selling for more than $60,000, a new record was all but inevitable.” Industry analysts claim the most obvious headwinds in the new car market are generated by higher interest rates, forced by the Federal Reserve's rate hikes intended to tame inflation, and by generally limited inventory. A recent report from J.D. Power showed that the average monthly payment for a new vehicle loan in December was $718, up $47 from a year ago. But 16% of consumers in December took out loans with monthly payments of over $1,000. Consumers think vehicles, and electric vehicles especially, are way too expensive. Fortunately, manufacturersÂ’ incentives, all but extinct in the past two years, are returning, especially in the electric-vehicle and luxury market, the Kelley data suggest. Plus, "With the new tax credits on the way, electric vehicle ATPs will drop lower for qualifying vehicles,” Rydzewski said. Non-luxury brands, such as Honda and Kia, showed particularly strong performance in December, with the average price paid at $45,578 — a record high and an increase of $994 month over month. Meanwhile, the average luxury buyer paid $66,660 for a new vehicle last month. Mercedes-Benz and Land Rover showed the most price strength in the luxury market, transacting between 2.6% to 6.5% over sticker price. But luxury brands Audi, BMW, Infiniti, Lexus, Lincoln, and Volvo showed the least price strength with some discounting in effect, selling 1% or more below MSRP in December, according to the survey.

2018 Kia Niro PHEV Review | More MPG than an SUV, less weird than a hybrid

PORTLAND, Ore. — It seems like such a no-brainer. The 2018 Kia Niro PHEV has the body of a little SUV, which is just the thing that everyone, their mother, brother, and friend named Phil are clamoring for at the moment. The rest of the plug-in hybrid segment is dominated by slug-shaped eco mobiles that ape the Toyota Prius or that are literally a Toyota Prius. Personally, I don't want to drive a slug. I also don't want to deal with weird interior controls, weirder interior design or four-person back seats. The Niro is very normal by comparison. Get in, press start, slide completely normal PRNDL shifter into D, and go. Better still, the PHEV doesn't suffer from the laggardly throttle response of the regular hybrid Niro that hampers drivability and makes its EPA-estimated 49 mpg combined a bit of a mirage. You'll either get that mpg and live with an accelerator pedal seemingly unattached to the powertrain, or slot the shifter into Sport and live with fuel economy in the low 40's. That's far superior to the 20-something you'd get in comparably sized SUVs, but still short of the 50-something-mpg in the Toyota Prius, Honda Insight or the Niro's mechanically related Hyundai Ioniq cousin. Compared to a typical, disconnected-feeling PHEV throttle, the Niro PHEV's throttle is perfectly normal, leaving Sport to those moments when you want a little extra zest from your plug-in hybrid (such a moment never seemed to arise). One can assume this is due to the larger battery that allows for greater electric input even when the plug-in battery range is depleted. When filled to the brim, it offers an EPA-estimated all-electric range of 26 miles, a figure I bettered by 1 mile during my evaluation route. That's nearly half of what you can get out of a Chevy Volt or Honda Clarity PHEV, but is similar to the Toyota Prius Prime and Ioniq PHEV. And really, how much you drive in all-electric mode makes the biggest difference. If your daily commute is in the 20-mile range, it doesn't really matter which of the above-mentioned plug-ins you choose. If it's more, though, the others will make more sense. The Volt and Clarity can run on electricity longer, and the Prius Prime and Ioniq are more efficient once their plug-in range is depleted. In the end, though, isn't this really just splitting hairs?

Hyundai, union reach tentative labor deal

According to Reuters, South Korea's labor unions may have reached a tentative deal with Hyundai following a compromise between the two sides on wages. Workers have staged a number of stoppages since August 20, which have cost the South Korean giant 1.02 trillion won - around $1.1B US. It also represents just over 50,000 units of production. That vehicle total sounds like a lot, but it's a small enough figure that Hyundai can apparently catch up with weekend and overtime shifts. We'd wager that this is why US inventories haven't been hit quite so hard aside from the battering already taking place. The proposal will now go before the union's rank and file.
If ratified, the new agreement will see workers getting a 5.14-percent raise in base salaries, along with 8.5-million-won (roughly $7,800) bonuses. Those concessions are a far cry compared to what the union was initially demanding, though. Early proposals included a 56.25-gram gold medal for each employee (worth about $2,400) and a 10-million won bonus (about $9,100) for employees whose children chose not to attend college. The union also sought a bonus worth two months' salary for workers that have been with the company for over 40 years, but this was negotiated down to a flat rate of six-million won ($5,464).
Based on Reuters' report, the work stoppages must have taken a real toll on Hyundai - its domestic sales dropped 20 percent last month, while exports were down nine percent. Those startling figures must have put some fire under the Hyundai bargaining team.