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Average new-vehicle transaction price hits a whopping new peak in December

Elevated prices for products and higher borrowing rates led to record high transaction prices for new vehicles in December, with the average cost in the U.S. rising to a record $49,507, according to data from Kelley Blue Book released today. The report notes that ATPs — average transaction prices — have climbed above suggested retail prices — MSRPs — for more than a year. Sales volumes were up in December on a year-over-year basis by more than 5%, a situation Kelley attributed to improved supply. Overall sales for 2022, however, were off 8% year over year. “The transaction data from December clearly indicates overall prices showed no signs of coming down as we headed into year-end,” said Rebecca Rydzewski, research manager of economic and industry insights for Cox Automotive. “Luxury prices fell slightly in December, but non-luxury transaction prices were up. Truck sales were particularly strong last month, and with many trucks selling for more than $60,000, a new record was all but inevitable.” Industry analysts claim the most obvious headwinds in the new car market are generated by higher interest rates, forced by the Federal Reserve's rate hikes intended to tame inflation, and by generally limited inventory. A recent report from J.D. Power showed that the average monthly payment for a new vehicle loan in December was $718, up $47 from a year ago. But 16% of consumers in December took out loans with monthly payments of over $1,000. Consumers think vehicles, and electric vehicles especially, are way too expensive. Fortunately, manufacturersÂ’ incentives, all but extinct in the past two years, are returning, especially in the electric-vehicle and luxury market, the Kelley data suggest. Plus, "With the new tax credits on the way, electric vehicle ATPs will drop lower for qualifying vehicles,” Rydzewski said. Non-luxury brands, such as Honda and Kia, showed particularly strong performance in December, with the average price paid at $45,578 — a record high and an increase of $994 month over month. Meanwhile, the average luxury buyer paid $66,660 for a new vehicle last month. Mercedes-Benz and Land Rover showed the most price strength in the luxury market, transacting between 2.6% to 6.5% over sticker price. But luxury brands Audi, BMW, Infiniti, Lexus, Lincoln, and Volvo showed the least price strength with some discounting in effect, selling 1% or more below MSRP in December, according to the survey.

Honda and Michael Bolton wish you happy holidays, social-style

There's nothing like landing a big celebrity for a high-profile advertising campaign to say to the world "Our brand has still got it!" Dodge, for instance, has been getting huge publicity by landing Will Ferrell as Ron Burgundy, to pitch its entire lineup on TV and on YouTube. Honda meanwhile, has reeled in the biggest fish in the 1990s Soft Pop category, the ineffable Michael Bolton. (We're assuming that Kenny G was booked.) We don't see how this can backfire, Honda.
In an effort to promote its annual holiday-season sales event, Honda has tapped the multitalented Bolton - he sings, acts and stares longingly at you from across the room - to dangle himself as a prize for ardent social media users. That's right, for the next few days (November 18 to 22), people that use the hashtag #XOXOBolton on Twitter, Facebook, Instagram or Vine, will be entered to win one-of-a-kind "musical greeting cards" from the now very blond crooner.
Not enough Bolton for you? Don't worry, Honda's got Michael booked for six TV commercials to air throughout the holiday season, too. Scroll down to get lost in Bolton's luxuriant eyes watch the promotional video from Honda.

McLaren collaborating with Honda future road cars?

McLaren and Honda may expand their alliance beyond the world of Formula 1, according a report from the UK's Autocar, which quotes McLaren CEO Martin Whitmarsh.
Citing the multi-year deal, Whitmarsh remarked at last weekend's Hungarian Grand Prix, "It's a pure Formula 1 contract, but we've already been looking at automotive technology and we're sharing that very openly. Our road car strategy at the moment has no other automotive partner and Honda would be a good place to collaborate."
Still, we wouldn't count on seeing a McLaren-Honda road car in the near future. According to Autocar, McLaren's road-car division is already tied up working on a rival for the Porsche 911, called the P13.