Edmunds.com Reports True Cost of Incentives: Domestic Automakers Reduced Incentives Spending While Imports Increased Incentives

SANTA MONICA, Calif., April 19 -- Edmunds.com (http://www.edmunds.com/), the premier online resource for automotive information, reported today that the average manufacturer incentive per vehicle sold in the United States was $2,379 in March 2004, up $144, or 6.4%, from March 2003, and down $80, or 3.3%, from February 2004.

Edmunds.com's monthly True Cost of Incentives(SM) (TCI(SM)) report takes into account all of the manufacturers' various United States incentives programs, including subvented interest rates and lease programs as well as cash rebates to consumers and dealers. To ensure the greatest possible accuracy, Edmunds.com bases its calculations on sales volume, including the mix of vehicle makes and models for each month, as well as on the proportion of vehicles for which each type of incentive was used.

For the first time since Edmunds.com began reporting TCI (January 2002), domestic automakers' incentives spending declined while average incentives on import brands increased. Overall, combined incentives spending for domestic Chrysler, Ford and General Motors nameplates decreased by 4.7% to $3,250 per vehicle in March compared to $3,409 in February. After climbing for three consecutive months, Chrysler's incentives spending went down in March by $253 to $3,603 per vehicle. In March, Chrysler lost 0.38% market share. General Motors' incentives spending decreased by $56 to $3,394 per vehicle while its market share dropped by 0.20% to 26.9%. Ford's incentives spending declined by $225 to $2,807 per vehicle -- the company's lowest since April 2003 -- while its market share was largely unchanged at 19%.

In March 2004, Korean automakers spent $1,889, European automakers spent $1,749 and Japanese automakers spent $899 per vehicle sold. The previous month, Korean automakers spent $1,686, European automakers spent $1,596 and Japanese automakers spent $881 per vehicle sold.

Of all brands, Mini spent the least -- virtually nothing -- on incentives while Scion spent only $64 and Lexus spent $193 per vehicle on average. At the other end of the spectrum, Cadillac spent the most incentives dollars per vehicle at $4,339, followed by Oldsmobile at $4,332 and Lincoln at $4,094.

Among vehicle segments, large cars had the highest average incentives last month at $3,663, followed by large SUVs at $3,291 and minivans at $2,775. Luxury SUVs had the lowest average incentives at $1,263, followed by compact cars at $1,832 and luxury sport cars at $1,885. Large trucks have gained the most market share since March 2003, increasing from 13.2% to 14.4%, while compact cars have lost the most market share during that period, down from 16.3% to 14.7%.

Industry average days-to-turn, which measures how many days on average it took to sell vehicles after they arrived at dealerships, was unchanged for the month at 69 days in March, compared to 65 days in March 2003. Isuzu had the longest days-to-turn at 137, followed by Mitsubishi at 99 days. The quickest inventory turnaround was for Scion at 20 days, followed by Lexus at 23 days.

From February 2004 to March 2004 the Edmunds.com New Vehicle Price Index increased 0.2% to 99.9 (base = 100 set in January 2002). From March 2003 to March 2004, the Edmunds.com New Vehicle Price Index increased 2.9% from 97.1 to 99.9. By segment, luxury cars saw the largest increase at 1.5% followed by compact SUVs at 1.3%. Sport cars had the most significant decline at 0.8%, while luxury SUVs dropped 0.6% month over month.

In March 2004, the sales-weighted average new vehicle sticker price was $29,383, $230 higher than in February 2004 and $1,391 higher than in March 2003. The sales-weighted average net price was $25,024, -- 14.8% below MSRP -- up $278 for the month and up $1,237 compared to March 2003.

The average net price was 14.8% below MSRP in March 2004, compared with 15.0% in March 2003. For domestic automakers, average net price was 18.9% below MSRP, unchanged from March 2003. Korean manufacturers' average net price was 15.9% below MSRP in March 2004, up from 12.6% in March 2003. Japanese manufacturers' average net price was 8.6% below MSRP in March 2004, down from 9.7%, while European manufacturers' average net price was 7% below MSRP in March 2004, up slightly from 6.7%.

This data was released today with the Edmunds Price Index for new vehicles (EPI-N), which reflects price shifts for the industry as a whole, and can be analyzed by different market segmentation. Similar to the Consumer Price Index, the EPI-N measures the average changes in retail prices for a fixed basket of new vehicles with fixed options over time for the purpose of trend analysis. Edmunds.com also analyzes transaction prices and net prices by country of origin, manufacturer, make and model, reflecting manufacturer-to- consumer rebates, including low APR and special lease programs.

About Edmunds.com True Cost of Incentives(SM) (TCI(SM))

Edmunds.com's TCI(SM) is a comprehensive monthly report that measures automobile manufacturers' cost of incentives on vehicles sold in the United States. These costs are reported on a per vehicle basis for the industry as a whole, for each manufacturer, for each make sold by each manufacturer and for each model of each make. TCI covers all aspects of manufacturers' various incentives programs (except volume and similar bonus programs), including dealer cash, manufacturer rebates and consumer savings from subvented APR and lease programs (including subvented lease residual values used in manufacturer leasing programs). Data for the industry, the manufacturers and the makes are derived using weighted averages and are based on actual monthly sales and financing activity.