New-vehicle prices increased in July to $49,855, the highest level of 2026, according to new data from Kelley Blue Book, a Cox Automotive brand. The average transaction price (ATP) was higher year over year by 1.9% but remained below the all-time peak reached in December 2025 of $50,612. The ATP of $49,855 was higher by 0.2% from June. ATPs typically trend lower in July; the long-term monthly move is a decline of 0.1%.
July defies the seasonal trend
New-vehicle sales in July were lower year over year by 1.5% and mostly flat compared to June, as the market slowed and buyers continued to migrate to lower-priced vehicles.
Higher sales volume in the subcompact SUV and compact car segments, among the most affordable segments, helped hold industry prices lower.
The July rise is partly attributable to 2027 model-year vehicles beginning to arrive at dealer lots with the latest features and higher sticker prices. Cox Automotive Executive Analyst Erin Keating noted that “while incentive spending eased in July, that’s only part of the pricing story. We’re also seeing more 2027 model-year vehicles arrive on dealer lots, bringing fresh content, feature updates and higher sticker prices into the market. “Consumers continue to gravitate toward more affordable segments, which is helping keep overall transaction price growth in check, but the steady flow of newer vehicles is providing some upward pressure on both ATPs and MSRPs,” Erin Keating, executive analyst at Cox Automotive, said in a statement.
EV incentives fall sharply
Shoppers of electric vehicles spent more in July after several months of price declines. The average new price paid for an EV in July was $56,126, up 1.6% from a year ago and 1.2% from June.
EV incentives declined to $6,626 in July, down 9.1% from June and 24.3% year over year. Incentives as a percent of ATP were 11.8%, down from 15.8% a year ago, but remained well above the industry average of 6.4%.
The pullback in EV discounting signals that automakers are relying less heavily on rebates to move electric inventory, a reversal from the aggressive discount strategies seen through much of 2025. That shift is already visible in broader EV market dynamics, where softer demand has forced some brands to rethink their sales approaches.
Bestseller incentives move in the opposite direction
While EV discounts contracted, incentives on the country’s bestselling conventional cars and trucks rose sharply, according to a separate CDK Global analysis published this week. The average incentive for the bestselling cars reached $1,228, up 17% from last month and 14% from July 2025. Trucks received an additional $1,152 in incentives from last month, a 30% gain.
Much of the car incentive change came from the shift in the Ford Explorer as that brand’s Employee Pricing program ended, shifting incentive spend up 31%, far more than any other model.
Only two other passenger vehicles tracked saw incentives increase in July: the Hyundai Tucson at 22% and the Nissan Rogue at 4.2%.
Average transaction prices for bestselling trucks fell 1.8% from June, reducing the average buyer’s cost by $1,035. Although truck prices have been declining since April, July marked the largest monthly drop of 2026. Dealers are using cash and rate offers to move slow-selling inventory while simultaneously pulling back EV rebates as battery-electric supply conditions shift.
Hyundai’s strong incentive activity on the Tucson also tracks with the brand’s recent sales momentum. Hyundai set all-time records in the first half of 2026, driven in part by aggressive retail programs.
What buyers face heading into August
The data suggests the elevated prices of recent months may be difficult to sustain. While prices remain above 2025 levels, the market could be entering its seasonal decline earlier than usual.
For the second month in a row, incentive spending, such as dealer cash back or lower finance rates, has declined. For buyers seeking relief, lower-priced segments and increased conventional-vehicle incentives offer the clearest near-term opportunities.
Kelley Blue Book and CDK Global typically publish monthly transaction data within six weeks of the close of each month.
