Auto sales have been on an upward trajectory for many months, and the latest data shows that cash on the hood isn't one of the reasons. According to Automotive News, incentive spending was at a five-year low in April, down 14 percent to an average of $2,320 per vehicle.

Toyota
had the lowest incentives among the top six automakers in the United States, with an average of $1,885 per unit. Nissan discounts dropped the most on a percentage basis, down 33 percent to $1,998. Honda actually increased spending to $2,187, bucking the industry trend. Buyers of Japanese autos can likely expect the dropping incentives to continue in the short term, as supply issues mean that fewer vehicles will be available on dealer lots.

As you may have expected, Ford's strong product lineup has helped the automaker cut spending by 20 percent to $2,399 – the lowest among the Detroit Three. Chrysler was next with an average rebate of $2,806. General Motors came in last at $3,068 per unit, which is still down 8.1 percent from April 2010.

So what does this mean for car buyers? We're guessing that incentives will continue to remain where they're at, or perhaps even drop further in the months ahead. After all, April's adjusted sales rate came in at 13.2 million for 2011, with no hint of slowing down, and analysts have expected 12.7 to 13 million sales for the year. About the only thing that could change that right now is the continuing rise of gas prices, which is a real possibility.


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  • 15 Comments
      • 3 Years Ago
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        Danaon
        • 3 Years Ago
        GM has a really high average transaction price, something north of $30k. They have to offer higher dollar incentives just to match the same percentage of incentive to transaction price. Plus, this is only in dollar incentive spending. It doesn't count financing deals, leases, free maintenance, and all those cost money.
      lne937s
      • 3 Years Ago
      People wondering why Japanese cars underperformed last month on sales have their answer.
        • 3 Years Ago
        @lne937s
        [blocked]
          lne937s
          • 3 Years Ago
          Are you really that dense to not realize the two are directly related? As supply tightens, you reduce incentives to maximize profits from the cars you have on the lot. The earthquake tightened supply which leads to reduced incentives as you don't need to move volume. If they maintained incentives, they would just clear out the lots in April at a lower margin and have virtually no supply of many popular models in May and June. This is how reduced supply affects incentives and sales numbers.
      Igotmine
      • 3 Years Ago
      As fewer cars become available on the market due to the earthquake in Japan and the tsunami with the resulting part shortages, I think that incentives will all but disappear. Why discount when the available selection is limited? My wife's youngest brother is the sales manager at a dealership that sells several foreign brands and he is retailing the 2011 Sonata, the 2011 Elantra and the Corolla at full MSRP, the Camry at -$1500 and the Tundra at -$2500. And the shortages haven't even hit yet. Expect to pay more in the coming months until this parts shortage thing is ironed out in 2012.
      • 3 Years Ago
      [blocked]
        GeorgeAtha
        • 3 Years Ago
        what an utter moron you are ... but it will be nice to know what are U driving my friend, share the joy! Tell us, since you seems to be such an expert, especially regarding one specific Japanese car manufacturer ... share the joy ... what are you driving? Mods?
        Jac Zobel de Ayala
        • 3 Years Ago
        lay off the loud mouth, you uneducated meathead. You're not helping your cause
        lne937s
        • 3 Years Ago
        Is this the recall of unsafe POS cars you are talking about: http://wheels.blogs.nytimes.com/2011/05/04/in-sweeping-action-g-m-recalls-154000-chevrolet-cruze-models/?smid=tw-nytimeswheels&seid=auto
      SheldonRoss
      • 3 Years Ago
      (insert rant about incentives vs fleet sales vs average transaction price) Therefore my (favourite car brand) is better than yours.
      SheldonRoss
      • 3 Years Ago
      Therefore my is better than yours.
      • 3 Years Ago
      [blocked]
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