The average price paid for a new EV increased by $313 (up 0.5%) in March 2023 compared to February 2023. The average new EV sold for $58,940 in March, according to Kelley Blue Book (KBB) estimates—well above the industry average. New EV pricing peaked in 2022, coming down steadily since Q3 of last year.

Still, March’s upward movement of EV average transaction price (ATP) was a bit of a surprise, said KBB, since Tesla, the automaker with the largest share of EV sales, has cut prices three times in recent months. However, EV sales from Mercedes, Rivian, Lucid and other brands have increased at the same time, offsetting lower-priced Tesla products.

More broadly, March 2023 saw the end of a nearly two-year trend when the average price paid in the US for a new vehicle fell below the manufacturer’s suggested retail price (MSRP) for the first time in 20 months. For comparison, a year ago in March 2022, the average ATP was nearly $1,000 over MSRP. Sales volumes were up month over month by 20% and up 8% year over year in March 2023, thanks partly to improved supply, a better mix of lower-priced models and strong fleet sales.

The ATP of a new vehicle in the United States declined in March 2023 to $48,008, a month-over-month decrease of 1.1% ($550) from a downwardly revised February reading of $48,558.

March 2023 transaction prices remained up 3.8% ($1,784) compared to year-ago levels. Meanwhile, auto manufacturer’s incentive spend rose to the highest level in 12 months at 3.2% of the ATP in March 2023, averaging $1,516.

The average price paid for a new non-luxury vehicle in March 2023 was $44,182, a decline of $505 compared to February 2023. Most non-luxury brands—including Chevrolet, Chrysler, Dodge, Ford, Hyundai, Kia, Nissan and Volkswagen—saw ATP declines between 0.2% to 3.8% month over month in March. This correlates with higher incentives helping to push prices down. Honda and Kia showed the most price strength in the non-luxury market, transacting between 3% and 6% over sticker price in March.

Strong luxury vehicle sales have been a primary reason for overall elevated new-vehicle prices. This trend continued in March 2023 when luxury vehicle share hit 18.2% of total sales, down slightly from a high of 19.3% in January 2023. The high share of luxury sales continues to push overall industry ATP higher, even though the luxury ATP has declined month over month.

For comparison, in March 2018, the luxury share was 14.0% of the market. Two luxury brands now have average transaction prices over $100,000: Land Rover and Porsche. (Kelley Blue Book data presented here does not include brands such as Ferrari and Rolls Royce.)

Buyers continue to pay over MSRP for new luxury vehicles. In March 2023, the average luxury buyer paid $65,202 for a new vehicle, down just $9 from February 2023. Luxury vehicle ATPs were a mixed bag in March, with entry-level luxury cars, high-end luxury cars, luxury compact SUVs, luxury mid-size SUVs and luxury subcompact SUVs all showing price declines between 0.5% and 1.4%. Luxury cars and luxury full-size SUVs saw price increases between 0.8% and 1.6%.