New vehicle prices are at a record high according to new September data shared by Kelley Blue Book. Its new estimates indicate that the new-vehicle average transaction price (ATP) surged past $50,000 last month for the first time ever. KBB researchers say this continues the trend of rising new-vehicle prices that have gone up steadily for more than a year with the pace accelerating in recent months. Still, KBB researchers say people are buying cars at a healthy pace despite rising prices.
As to why prices surged in September, KBB attributes it in part to the rush to buy EVs which are more expensive. Car Pro Show host Jerry Reynolds says he expects the ATP will drop back under that mark in October, with very few electrics being sold since the $7,500 federal rebate is gone.
Reynolds was on Fox 26 Houston this week to talk about this exact subject, you can see the TV segment here or below:
Here are some additional stats from Kelley Blue Book:
- The new-vehicle ATP was $50,080 in September, marking the first time it ever exceeded the $50,000 mark. The ATP last month was up 2.1% from August and was higher year over year by 3.6%. The annual gain of 3.6% in September was the largest gain since the spring of 2023, but aligned with the long-term average of ATP inflation.
- KBB also reports that incentive spending increased in September to 7.4% of ATP, or approximately $3,700. Incentive levels in September were at the highest point in 2025, up from 7.2% of ATP in August. A year ago, in September 2024, incentive levels were equal to 7.3% of ATP.
- As 2026 model year product arrives on dealer lots, the average new-vehicle manufacturer's suggested retail price (MSRP) – commonly called "the asking price" – also reached a new record-high in September of $52,183. The MSRP last month was higher by 4.2% year over year, an increase above the long-term average.
- KBB says a rich mix of luxury vehicles and expensive EV models likely helped push the ATP into record territory last month. Kelley Blue Book is initially estimating the EV electric vehicle share of the U.S. market in September at 11.6%, a record high. The EV ATP last month was $58,124, up 3.5% from the revised lower EV ATP in August.
- Last month, Kelley Blue Book reports there were more than 60 models with ATPs above $75,000 with total sales near 94,000 units – 7.4% of total industry sales, up from 6.0% in September 2024. In the rare air of six-figure vehicles, the Cadillac Escalade is still king. Two versions are available, with total sales in September reaching 4,320 units.
"It is important to remember that the new-vehicle market is inflationary. Prices go up over time, and today's market is certainly reminding us of that. The $20,000-vehicle is now mostly extinct, and many price-conscious buyers are sidelined or cruising in the used-vehicle market," said Erin Keating, Executive Analyst, Cox Automotive. "Today's auto market is being driven by wealthier households who have access to capital, good loan rates and are propping up the higher end of the market. Tariffs have introduced new cost pressure to the business, but the pricing story in September was mostly driven by the healthy mix of EVs and higher-end vehicles pushing the new-vehicle ATP into uncharted territory. We've been expecting to break through the $50,000 barrier. It was only a matter of time, especially when you consider the best-selling vehicle in America is a pickup truck from Ford that routinely costs north of $65,000. That's today's market, and it is ripe for disruption."
Electric Vehicle Sales Soar Despite Higher Prices
- Kelley Blue Book estimates show that a record 437,487 electric vehicles were sold in the third quarter of 2025, with EV share reaching 10.5% of the market. With government-supported EV sales incentives set to expire at the end of September, buyers rushed to finalize deals, pushing total volume higher year over year by nearly 30%. (Cox Automotive's Q3 2025 Kelley Blue Book EV Sales Report can be found here.)
- The initial estimate of the EV average transaction price in September was $58,124, up 3.5% from the revised-lower ATP in August. Year over year, EV prices remained mostly unchanged, lower by 0.4%.
- At 15.3% of ATP (nearly $8,900), EV incentives in September were lower compared to August. A year ago, EV incentives averaged 13.0% of ATP.
- The ATP for a new Tesla last month was $54,138, down slightly from August and lower year over year by 6.8%. With new, lower-priced versions of the best-selling Model 3 and Model Y announced recently, KBB predicts that Tesla and segment-wide ATPs will likely decline in the coming months.
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