With automotive prices skyrocketing these last two years, you may have found yourself waiting out the market until wealthy business magnates, unaccountable banking institutions, and multinational monopolies have had their way with it – hoping beyond hope that they’ll be a modestly priced car for you to live in when the economic dust finally settles.
But what if you can’t wait that long and need something today? While may not be able to steer you toward the deal of a lifetime, we do know which vehicles you might want to cross off your list thanks to a study targeting mainstream models seeing the highest dealer markups. Though, be warned, you’re still probably better off driving whatever you have today because the national average still has vehicles listed 10 percent above MSRP.
That’s a sizable hunk of cheddar and one that is going to be nearly impossible for most people to avoid. But it’s nowhere near the gouging seen from select, in-demand models dealerships know they can screw you with.
The study, conducted by iSeeCars, analyzed 1.9 million new car listings found between July 1st and September 7th, 2022, and determined that the average vehicle is being priced 10 percent higher than the manufacturer recommends. While that doesn’t mean it’s impossible to find something that won’t cost several thousand dollars more than it otherwise would have, it does mean you’re going to have to spend a lot more time shopping around before you uncover a bargain.
However, there are also some vehicles that seem to be grotesquely overpriced no matter how you slice it and the matter typically comes down to how in-demand they happen to be. While iSeeCars attempted to mitigate this by excluding “low-volume models and heavy-duty vehicles” from its analysis, some of the entries are newer models people are scrambling to buy.
“Dealers have responded to market conditions by pricing cars above MSRP making a higher profit on specific models to help offset lower sales volumes from restricted new car production,” said iSeeCars Executive Analyst Karl Brauer. “In today’s market, consumers are willing to pay well-above sticker price for new cars because inventory is so scarce and because they know that new car pricing is not expected to improve until 2023 at the earliest.”
Number one on the list was the Jeep Wrangler, trading at 24.4 percent above MSRP (which works out to an average premium of $8,433). It was joined by the Jeep Gladiator which was typically listed at 18.5 percent above MSRP. While that sounds like Jeep’s pickup is the better bargain, its higher price tag effectively meant you’d be spending $8,478 in dealer markups. The same was true of the Jeep Wrangler Unlimited, which averaged $8,877 above MSRP at 20 percent.
“As demand continues to exceed supply for these popular vehicles, dealers are adding market adjustments generally ranging from $2,000 to $10,000 on top of their MSRP, with markups being especially high for the V8 Wrangler Rubicon 392,” explained Brauer. “The Jeep Wrangler and the Jeep Wrangler Unlimited are among the cars that hold their value best due to their ruggedness and enthusiastic fan base, which likely contributes to car buyers paying a premium for them amid their scarcity on new car lots.”
Keep that in mind because vehicles that held their value tended to be a common sight on the list. Number two was the Porsche Macan (23.1 percent or $14,221 above MSRP), number three was the Genesis GV70 (22.4 percent or $10,278), and number four was the Lexus RX 450h (21.9 percent or $10,847).
Despite becoming notorious for quality control complaints and production slowdowns Ford’s been eager to address, the Bronco came in at number five. Released in June of 2021, the SUV has become a popular choice (every upper-middle class person near me seems to have bought one) meaning dealers can ask for 21.6 percent above MSRP – resulting in an extra $8,697.
“The Ford Bronco has been in high demand since its debut last year, and this demand has exceeded supply as inventory shortages have led to long wait lists and frequent dealer markups for the vehicle,” said Brauer. “Ford closed the order books for the 2022 Bronco in May and began taking orders for the 2023 version in late August.”
Ford’s Maverick also made the list, trading 18.4 percent above MSRP and following a similar (albeit less troublesome) trajectory as the much larger Bronco.
“The Maverick compact pickup has been in high demand since its debut, which forced dealers to stop taking orders for both versions at the end of January, resuming only in mid-September,” said Brauer. “Heightened gas prices have boosted demand for this already-hot seller, with both the hybrid and gasoline versions returning excellent gas mileage, and even these marked-up prices remain attainable for buyers given the starting prices of under $25,000.”
Here’s the list in full:
- Jeep Wrangler (24.4 percent or $8,433 above MSRP)
- Porsche Macan (23.1 percent or $14,221 above MSRP)
- Genesis GV70 (22.4 percent or $10,278 above MSRP)
- Lexus RX 450h (21.9 percent or $10,847 above MSRP)
- Ford Bronco (21.6 percent or $8,697 above MSRP)
- Jeep Wrangler Unlimited (20.0 percent or $8,877 above MSRP)
- Cadillac CT5 (19.9 percent or $8,335 above MSRP)
- Porsche Cayenne (19.6 percent or $16,750 above MSRP)
- Chevrolet Corvette (19.5 percent or $14,697 above MSRP)
- Mercedes-Benz GLB (19.0 percent or $7,650 above MSRP)
- MINI Hardtop 2 Door (18.8 percent or $5,426 above MSRP)
- Lexus RX 350L (18.8 percent or $9,423 above MSRP)
- Jeep Gladiator (18.5 percent or $8,478 above MSRP)
- Ford Maverick (18.4 percent or $4,614 above MSRP)
- Genesis GV80 (18.0 percent or $10,124 above MSRP)
“New car buyers will probably have trouble finding available inventory and can expect to pay higher-than-average prices for vehicles that are in high demand,” added Brauer. “Consumers looking to purchase a new car should do their research and compare prices between multiple dealers, and in some cases can avoid markups by ordering directly from the manufacturer.”
My advice? Check out the used market if you’re comfortable with private sellers and have enough knowledge to ensure you’re not being sold a lemon. Dealers will keep doing this for as long as they think they can get away with it.
[Images: Gretchen Gunda Enger/Shutterstock]
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