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Average transaction prices climb to a record $36,270 in January

The automotive sector made a hash of the numbers last month, a mess of pluses and minuses clogging the transaction-price charts according to Kelley Blue Book. The overall industry rose one percent, even though buyers bought fewer cars and light vehicles in January 2018 vs 2017 using the selling-day adjusted rate. Due to January transaction prices rising to $36,270, a record for January, the value of new vehicles sold climbed more than $1 billion compared to January 2017. KBB's transaction prices don't include customer incentives, which changes the complexion slightly; average incentive spending rose to just over ten percent. The average transaction price in December 2017 was $36,756, so January dropped a bit - nothing unexpected, with the month annually blamed for "January doldrums." More revealing is the fact that the average transaction price in January 2017 was $34,910. This year's plumped-up figure came courtesy of the continued shift to crossovers, SUVs, and light trucks, which shouldn't surprise anyone who's read an automotive blog in the past 20 years. That category comprised nearly 70 percent of new vehicle sales for the month. Some manufacturers profited more than others, though. Fiat Chrysler managed 12.8 percent fewer sales in January compared year-on-year, but the company's vehicles sold for $1,300 more. The Ford brand suffered a 6.3-percent dip in sales, but brand transaction prices increased $2,000, while a Lincoln sold for $8,700 more on average. General Motors sold more cars and sold them for more money; overall GM transaction prices rose four percent, or $1,270, while a GMC traded hands for seven-percent more than in January 2017 and a Cadillac got $2,300 more on average. Of KBB's listed automakers, the Volkswagen Group got the most of out its customers, transaction prices rising at the German automaker by 5.6 percent to $42,243 in January 2018 compared to a year earlier. American Honda followed with a 4.3-percent increase to $28,991, GM in third at 4.1 percent to $40,313. Find your next car at Autoblog using our new and used car listings or the Car Finder tool. Broken out by segment, minivans rocked the table, transaction prices leaping by 7.9 percent to $35,380 compared to January a year earlier. Luxury cars boasted the next-highest rise, at 3.6 percent to $58,533.

Is today's Honda Accord cheaper than it was back in 1989?

Whether you're shopping at the grocery story or on a car lot, everything seems to be getting more expensive these days. However, when all the factors are considered, that might be more an issue of perception than of fact. The American Public Media radio show Marketplace recently tackled the question whether modern vehicles were actually more expensive once you factored in important variables like inflation and cost of ownership. The result was pretty surprising.
For its example, Marketplace chose the Honda Accord, because in August, it was one of the bestselling vehicles in the US, with 51,075 of them sold. Winding back the clock 25 years to 1989, Honda's cheapest Accord cost $11,770, and that money bought you a stripped-out car with 98 horsepower, a manual gearbox, no air conditioning and hand-crank windows.
Fast-forward to present day, and a basic Accord starts at around $22,000 and gives buyers significantly more features, including a 185-hp engine, dual-zone climate control, Bluetooth, cruise control, more space, refinement and much better safety. By Marketplace's math, when just figuring for inflation, that modern Honda would cost about $11,500 a quarter century ago, despite all of that extra equipment. But that's just one factor. Scroll down to listen to the full report for an explanation of how cost of ownership figures into the mix, and whether it throws all of the calculations off.

Honda returning to F1 as McLaren partner

Honda must really love Formula One racing, as evidenced by today's announcement that the Japanese automaker is returning to the world's most popular motorsport for the fifth time in its history. Honda has entered into a team partnership with McLaren to develop and manufacture power systems - the engine and energy recovery system - for the 2015 F1 season. McLaren will be in charge of chassis development and running the day-to-day operations of this newly formed team, which will be called McLaren Honda.
Honda says its decision to reenter F1 racing had to do with new regulations for the 2014 season that require cars to be powered by a 1.6-liter direct-injection turbocharged V6 engine paired with an energy recovery system. Apparently the chance to develop this particular powertrain for F1 racing was too enticing for Honda to pass up, which suggests it has bigger plans for the knowledge learned while developing these systems beyond just winning races.
As mentioned, this is Honda's fifth foray into F1 racing, the first being back in 1964 when it participated as its own team through 1968. Its longest stint came from 1983-1992 as an engine supplier, during which time it partnered with many teams, including McLaren, and won six Constructor Championships. Honda then returned from 2000-2005 as an engine supplier for British American Racing (BAR) before buying that team outright and running it as Honda Racing from 2006-2008. Then the global economic crisis hit. Honda's return to the sport will surely be welcomed by fans as its partnership with McLaren should produce a formidable team. It's a strong signal that the company has returned to health after a few tumultuous years, and hopefully its rediscovered motorsports mojo will help yield more passionately engineered street cars.