New-vehicle prices in the United States remained mostly stable in July compared to June, with a minor 0.1% decline month over month, according to new estimates from Kelley Blue Book. Strong sales volumes were supported by increased manufacturer incentive spending, which reached the highest point so far in 2025.
Overall Pricing Trends
The average transaction price (ATP) for a new vehicle in July was $48,841, down slightly from June’s revised ATP of $48,900. Year over year, ATPs were up 1.5% — the largest annual gain of 2025 — though still below historical averages.
Incentive spending averaged $3,553, or 7.3% of ATP, up from 7.0% in June and higher than the 7.0% level recorded a year earlier.
Manufacturer’s suggested retail prices (MSRPs) in July were 0.3% lower than in June but 2.4% higher than a year ago. The annual increase marked the largest in 2025 but remained under the long-term average of 3.5%.
Luxury and Volume Brand Performance
Many luxury brands reported notable year-over-year ATP increases in July. Cadillac, Land Rover, and Infiniti each posted double-digit gains, while Mercedes, Porsche, and Lincoln saw increases more than double the industry average. Audi, BMW, and Genesis reported growth closer to the industry average.
An exception among luxury automakers was Acura, which did not follow the upward pricing trend.
On the volume brand side, five automakers saw lower ATPs compared to July 2024. Jeep recorded the largest drop, with its ATP falling nearly 12% year over year to $47,275 — the lowest since fall 2021. Jeep incentives were 8.1% of ATP, down from June but well above the 5.5% reported a year earlier. The brand’s sales in July rose 27% compared to the same month last year.
Electric Vehicle Market Activity
Electric vehicle (EV) pricing declined both month over month and year over year. The July ATP for a new EV was $55,689, down 2.2% from June’s $56,915 and 4.2% lower than July 2024.
Tesla led the decline, with its ATP falling 2.4% from June and 9.1% year over year to $52,949. Increased sales of the Model 3 and Model Y contributed to the drop in Tesla’s average prices. Incentives for Tesla rose in July, helping boost sales compared to June, although they remained lower than a year earlier.
Industry-wide EV incentives reached record levels in July, averaging 17.5% of ATP—a more than 40% increase from the same month in 2024. The surge in incentives came as automakers and dealers sought to move inventory ahead of the Oct. 1 reduction in government-backed EV support.
EV Sales Surge
Preliminary estimates from Cox Automotive indicate that July was the second-best month ever for EV sales, with more than 130,000 units sold — a 20% increase from July 2024. Analysts attribute the strong performance to consumer demand ahead of the scheduled reduction in federal incentives.
A full report on July’s EV sales and pricing is expected next week from the Cox Automotive Newsroom.
About Kelley Blue Book
Founded in 1926, Kelley Blue Book, The Trusted Resource®, is the vehicle valuation and information source trusted and relied upon by both consumers and the automotive industry for nearly a century. As the industry standard for generations, Kelley Blue Book provides transparent, objective information and data-driven, innovative tools for consumers, automotive dealers, and manufacturers. Kelley Blue Book publishes millions of market-reflective values weekly on its top-rated website KBB.com, from its famous Blue Book® Trade-In Values to the Kelley Blue Book® Price Advisor tool, which offers a range for what consumers reasonably can expect to pay for a vehicle in their area. KBB.com editors rate and review hundreds of new vehicles each year to help consumers understand the Best Cars and Best SUVs to meet their needs. Kelley Blue BookSM Instant Cash Offer provides a redeemable trade-in offer to transaction-ready consumers and conveniently connects them to local participating dealers. Kelley Blue Book’s Service Advisor provides guidance on how much to pay for service and repairs, allowing consumers to schedule service with local dealers on KBB.com. Kelley Blue Book also provides vehicle values to finance and insurance companies as well as governmental agencies. Kelley Blue Book is a Cox Automotive brand.
About Cox Automotive
Cox Automotive is the world’s largest automotive services and technology provider. Fueled by the largest breadth of first-party data fed by 2.3 billion online interactions a year, Cox Automotive tailors leading solutions for car shoppers, auto manufacturers, dealers, lenders and fleets. The company has 29,000+ employees on five continents and a portfolio of industry-leading brands that include Autotrader®, Kelley Blue Book®, Manheim®, vAuto®, Dealertrack®, NextGear Capital™, CentralDispatch® and FleetNet America®. Cox Automotive is a subsidiary of Cox Enterprises Inc., a privately owned, Atlanta-based company with $23 billion in annual revenue. Visit coxautoinc.com or connect via @CoxAutomotive on X, CoxAutoInc on Facebook or Cox-Automotive-Inc on LinkedIn.
SOURCE Kelley Blue Book
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