Edmunds: Low inventory means high car prices on Black Friday

This has been a tough year to buy a new or used car in America. With COVID-19 factory shutdowns, semiconductor chip shortages, rising prices and supply chain issues, it’s been nothing but bad news for car shoppers. And for those who’ve waited, hoping Black Friday sales would bring some reprieve from high prices, we’re afraid that there aren’t many bargains to speak of.

In ordinary times, Black Friday would be a busy yet fruitful time to shop for a new car because dealerships are motivated to discount outgoing models to make room for the newest model year. However, Edmunds data shows that overall new car inventory levels are down 77% compared to 2019, when the market was more typical.

“The microchip shortage has forced inventory far below demand and vehicles are selling quicker than ever before,” said Jessica Caldwell, Edmunds’ executive director of insights. “In fact, many dealers are selling vehicles that haven’t even arrived on their lots yet.”

Vehicles that are left tend to be in a more expensive trim or are saddled with dealer-added accessories that further boost the vehicle’s cost. Couple that with the buying public’s continuing shift from sedans to higher-priced SUVs and trucks, and it should come as no surprise that the average new car transaction price hit a record high of $45,598 in October, according to Edmunds data.

Not only will buyers have to contend with fewer cars, but they are also not as likely to get much of a discount. In fact, 39% of shoppers in October paid over the manufacturer’s suggested retail price, while 35% of shoppers were given a discount of less than $500, according to Edmunds.

We do have some good news, though. Edmunds has combed through the latest transaction data to find five new vehicles with relatively high discounts and...