New-vehicle prices kept falling in May as incentives continued their own opposite momentum in a supply-and-demand dynamic ignited by boosted inventory.

Prices were down 1% month-over-month for an average transaction figure of $48,389, according to Cox Automotive’s Kelley Blue Book. Meanwhile, incentives rose to about 7% of that price and their highest point in three years.

As May got under way, new-vehicle inventory stood at an estimated 2.8 million units, up 51% year-over-year and the largest supply since late 2020, Cox said. Many automakers’ inventory exceeded 100 days.

Expensive full-size pickups skewed the ATP as they made an outsize impact on the market, Cox pointed out, with the best-selling U.S. vehicle, the Ford F-Series, at almost $68,000 on average.

“While there are a lot of vehicles transacting at very high prices, that doesn’t mean all new vehicles are unaffordable,” said Cox Executive Analyst Erin Keating. “There are still plenty of excellent, well-priced vehicles out there, particularly in the compact segments.”

The share of vehicles selling for less than $40,000, though, was on the rise, Cox said, comprising 41% of new-vehicle sales for the month, up from 37% a year earlier. But just one model with notable sales volume came in under $20,000: the Mitsubishi Mirage.

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