I hope nobody is paying full sticker for the average ride:
The Power Information Network, a subsidiary of J.D. Power and Associates, on Monday reported the finding in its industry newsletter, PIN Insights.
The industrywide decline means that automakers are bringing in less revenue and are likely to be less profitable when they report third- quarter earnings.
"They have to reduce costs as quickly as they can to minimize this," Tom Libby, senior director of industry analysis at PIN, told the Free Press.
"It's a serious situation," he said. "It does have enormous implications."
PIN attributes the decline largely to the soft environment: tight credit, low consumer confidence and relatively high gas prices. U.S. vehicle sales are down 12.8%, or 1.6 million vehicles, through September, compared with the same period in 2007. However, the market shift from large SUVs and other trucks to less-expensive, fuel- efficient small cars is also a factor.
Worse yet, the decline in average transaction prices has been accelerating throughout the year. In the first three months of 2008, average transaction prices declined by less than 1.5%.
From May through September, year-over-year price declines exceeded 4%.
But from Oct. 1-19, the price drop reached a near-term record of 7.7%.
Libby called the news a double whammy for the already-suffering automakers.