New-vehicle prices moved higher in August as more model-year 2026 vehicles reached dealer lots and automakers worked to offset higher costs. According to Kelley Blue Book estimates, both average transaction prices (ATP) and manufacturer’s suggested retail prices (MSRPs) increased month over month and year over year. Despite higher new-vehicle prices, retail sales climbed by 2.5% compared to last August.
EV Sales Hit Record Levels
Cox Automotive estimates show sales of electric vehicles reached a record 146,332 in August. EV share climbed to 9.9% of total sales, up from 9.1% in July. With government-backed EV tax credits set to expire at the end of September, analysts expect Q3 2025 to set a new all-time record for EV sales, surpassing Q4 2024’s 365,824 units.
The EV ATP rose to $57,245 in August, up 3% from July’s $55,562. Year over year, EV prices held steady, down just 0.1%. Higher EV sales volume helped push the overall ATP for the industry higher.
EV incentives averaged 16% of ATP in August, more than twice the overall market average. That equaled more than $9,000 per new EV, compared to 13.6% a year earlier.
Tesla’s ATP rose 2.9% in August to $54,468 but remained 5.5% lower year over year. The company’s sales fell 6.7% compared to last August, dropping its share of the U.S. EV market to 38% — the lowest level in the modern EV era.
“The one constant in the automotive business is that fresh product sells well,” said Stephanie Valdez Streaty, Senior Analyst at Cox Automotive. “While Tesla’s Model Y update has slowed the company’s sales decline, it’s not getting easier for the EV pioneer because the market is now flooded with all-new, fresh EVs from mainstream competitors — consumers have more choice than ever. The current surge in EV sales is being driven by product innovation, motivated dealers, and an urgency ahead of the IRA tax credit phase-out.”
New-Vehicle Prices and Incentives
The new-vehicle ATP hit $49,077 in August, up 0.5% from July ($48,841) and 2.6% higher year over year. That annual increase was the largest in more than two years, though still below long-term averages.
The average new-vehicle MSRP reached $51,099, higher than July and 3.3% above last August. That growth rate closely matches long-term averages and marks the largest gain of 2025.
Incentives softened, falling to 7.2% of ATP in August from 7.3% in July. Compared to last year, incentive spending remained mostly unchanged. Over the past year, incentives averaged 7.2% of ATP, peaking in late 2024 and hitting a low in April 2025.
Most automakers posted year-over-year price gains in August. Of 31 major brands tracked by Kelley Blue Book, only five recorded lower ATPs: Acura (down 6.5%), Tesla (down 5.5%), and Stellantis’ Dodge, Ram, and Chrysler, each down less than 1%.
Seventeen brands recorded gains of more than 3%. Full-size pickups, often equipped with EV and hybrid powertrains, continued to push new-vehicle prices higher. Four of the 10 best-selling U.S. vehicles are full-size pickups: Ford F-Series ($66,934), Chevrolet Silverado ($61,023), GMC Sierra ($70,150), and Ram pickup ($65,849).
“While new-vehicle prices continue their upward trajectory, the pace of change remains relatively measured, more a gradual correction than a seismic shift,” said Erin Keating, Executive Analyst at Cox Automotive. “Costs are clearly increasing, for automakers, dealers and buyers alike. This month’s increase aligns with our expectations. It reflects a market that’s adjusting to new production realities and consumer preferences without tipping into volatility.”
The Lucid Gravity X builds on the Gravity Grand Touring platform, combining advanced on-road refinement with new off-road capabilities, Lucid said.
Lucid Group unveiled the Gravity X concept, an SUV built for trail-ready adventures. The reveal took place at a private event at Pebble Beach Golf Links, ahead of its public debut. The Lucid Gravity X builds on the Gravity Grand Touring platform, combining advanced on-road refinement with new off-road capabilities, Lucid said.
Chicago welcomes its first electric refuse fleet with Republic Services, Mack LR Electric trucks, and ComEd driving cleaner, quieter waste collection.
The “Best of the Best” award represents the highest distinction within the Red Dot program, reserved for designs that redefine industry benchmarks.
The Polestar 3 used for the test was a production-standard SUV equipped with standard 20-in. wheels and Michelin Sport 4 EV tires.
Chevrolet emerged as the second-highest-selling EV brand in the U.S., while Cadillac led the luxury EV segment.
The VF 8 Eco starts at $39,900, while the Plus version begins at $44,900.
The companies will co-develop a compact SUV, car, pickup, mid-size pickup, and an electric commercial van for North America.
The Cadillac Elevated Velocity concept represents the next step in Cadillac’s V-Series performance evolution, it said.
The company ended the quarter with approximately $4.86 billion in total liquidity.
Cutting through the static to deliver you the latest electric vehicle news & innovations
