Specifically, the shortage of microchips in the summer of last year significantly affected the number of new vehicles arriving on the grounds. Manufacturers often decided to use their limited microchips to make high-end vehicles with higher profit margins to compensate. Due to the focus on luxury vehicles, fewer affordable options are available at dealerships and sale prices are skyrocketing.
In December 2021, the average buyer paid nearly $65,000 for a new luxury vehicle, while the average non-luxury vehicle cost around $43,000 per KBB. Average prices have particularly soared for certain manufactured products. For example, the average transaction price for all-brand new vehicles from Tesla Motors and General Motors was 20% higher in December 2021 than a year earlier.
Despite limited supply and fewer cars being sold, auto industry revenues are on the rise.
“Higher vehicle prices are offsetting lost sales volume,” Chesbrough said.
In 2021, industry revenues reached $649 billion, nearly $100 billion more than 2020 and more than 2019 revenues of nearly $2 billion.
And that’s with nearly 2 million fewer vehicles sold in 2021 compared to 2019, according to data from Cox Automotive.