Car prices in 2024 are showing signs of stabilization and even slight declines in some segments, especially for used vehicles and certain SUV models. While new car prices remain elevated compared to pre-pandemic levels, increased inventory, higher interest rates, and growing competition are helping ease the pressure on buyers.
If you’ve been eyeing a new SUV but hesitated due to sky-high prices over the past few years, you’re not alone. The automotive market has been a rollercoaster since 2020, with shortages, supply chain disruptions, and surging demand driving prices to record highs. But as we move through 2024, there’s growing evidence that the tide is turning. So, are car prices going down in 2024? The short answer is: yes, in many cases—especially for used vehicles and certain types of SUVs.
While new car prices haven’t dropped dramatically, they’re no longer climbing at the same breakneck pace. In fact, average transaction prices have begun to plateau or even dip slightly in some segments. This shift is thanks to a combination of improved manufacturing output, higher dealer inventories, and a more balanced supply-demand dynamic. At the same time, the used car market—which saw prices soar during the pandemic—is now cooling off, offering real savings for savvy buyers.
Key Takeaways
- New car prices are stabilizing: After years of steep increases, average transaction prices for new SUVs and cars are leveling off due to improved supply chains and higher dealer inventory.
- Used car prices are dropping: The used vehicle market has seen a noticeable decline in prices, making it a great time to buy pre-owned SUVs.
- Electric and hybrid SUVs are becoming more affordable: Government incentives, increased competition, and falling battery costs are driving down prices for eco-friendly models.
- Interest rates impact affordability: While car prices may be easing, higher auto loan rates can offset savings, so shop around for financing.
- Dealer incentives are returning: Manufacturers are offering more rebates, cashback deals, and low APR financing to attract buyers in a competitive market.
- Timing matters: End-of-year and end-of-quarter sales often bring the best deals on SUVs and other vehicles.
- Research is key: Use online tools to compare prices, check market trends, and negotiate confidently.
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Why Car Prices Are Easing in 2024
Several key factors are contributing to the current shift in car pricing. Understanding these can help you make smarter decisions when shopping for your next SUV.
Improved Supply Chains and Inventory Levels
One of the biggest reasons car prices surged in 2021 and 2022 was a global shortage of semiconductor chips, which stalled production for months. Automakers struggled to keep up with demand, and dealers had little to no inventory. This scarcity allowed them to charge premium prices and eliminate discounts.
Fast forward to 2024, and the situation has improved significantly. Chip production has ramped up, and manufacturers are catching up on backlogged orders. As a result, dealerships are seeing healthier stock levels—especially for popular SUV models like the Toyota RAV4, Honda CR-V, and Ford Explorer. With more vehicles on the lot, dealers are more willing to negotiate and offer incentives to move inventory.
Higher Interest Rates Are Cooling Demand
While higher interest rates are often seen as a negative for car buyers, they’re also playing a role in stabilizing prices. The Federal Reserve’s rate hikes have made auto loans more expensive, which has dampened demand—particularly for new vehicles. When fewer people can afford to finance a $50,000 SUV, automakers and dealers have less pricing power.
This shift has forced some manufacturers to reintroduce incentives, such as 0% APR financing, cash rebates, and lease deals. For example, Hyundai and Kia have recently launched aggressive financing offers on their SUV lineups to attract budget-conscious buyers. These moves signal that the days of “take it or leave it” pricing are fading.
The Used Car Market Is Cooling Off
If you’re open to buying a pre-owned SUV, 2024 might be one of the best times in recent memory to do so. Used car prices, which peaked in 2022, have been steadily declining over the past year.
Why Used Car Prices Are Dropping
During the pandemic, used car prices skyrocketed due to a perfect storm of factors: low new car inventory, increased demand for personal vehicles, and a shortage of rental cars. People who couldn’t buy new turned to used, driving up prices across the board.
Now, that trend is reversing. As new car production rebounds, more people are buying new, which reduces demand for used vehicles. At the same time, a wave of off-lease and rental cars is entering the market, increasing supply. According to industry reports, used car prices have dropped by 8–12% year-over-year in early 2024, with SUVs seeing some of the steepest declines.
Great Deals on Certified Pre-Owned SUVs
One of the smartest ways to save in 2024 is to consider a certified pre-owned (CPO) SUV. These vehicles come with extended warranties, thorough inspections, and often lower mileage than standard used cars. Brands like Lexus, Subaru, and Mazda are offering CPO SUVs at prices significantly below their original MSRP—sometimes 20–30% less.
For example, a 2021 Toyota Highlander CPO might now cost around $32,000, compared to over $40,000 when it was new. That’s a substantial savings, especially when you factor in the vehicle’s reliability and included warranty.
Electric and Hybrid SUVs Are Getting More Affordable
The shift toward electric vehicles (EVs) and hybrids is also influencing car prices in 2024. While EVs were once considered a luxury purchase, they’re becoming more accessible—especially in the SUV category.
Falling Battery Costs and Increased Competition
The cost of lithium-ion batteries—the most expensive component in an EV—has dropped by over 80% in the past decade. This trend is continuing in 2024, allowing automakers to produce more affordable electric SUVs. Models like the Hyundai Ioniq 5, Kia EV6, and Ford Mustang Mach-E are now priced closer to $40,000–$50,000, putting them within reach of more buyers.
At the same time, competition is heating up. Tesla’s dominance is being challenged by legacy automakers and new entrants like Rivian and Lucid. To stay competitive, brands are offering discounts, lease deals, and trade-in bonuses. For instance, Tesla recently reduced the price of its Model Y by $2,000, and Ford is offering $5,000 off select Mach-E trims.
Government Incentives Add Extra Savings
Federal and state incentives are another reason EV and hybrid SUVs are more affordable in 2024. The Inflation Reduction Act offers up to $7,500 in federal tax credits for qualifying electric vehicles, including many SUVs. Some states, like California and New York, add additional rebates of $1,000–$2,500.
Even if you don’t qualify for the full federal credit, many plug-in hybrids (like the Toyota RAV4 Prime or Ford Escape PHEV) are eligible for partial incentives. These savings, combined with lower fuel and maintenance costs, make electrified SUVs a smart long-term investment.
Dealer Incentives and Negotiation Opportunities
One of the most encouraging signs for car buyers in 2024 is the return of dealer incentives. After years of “no-haggle” pricing and limited discounts, manufacturers are bringing back deals to attract customers.
Cash Rebates and Low APR Financing
Many automakers are now offering cash rebates of $1,000–$3,000 on popular SUV models. For example, Chevrolet is offering $2,500 cash back on the 2024 Traverse, while Nissan has $2,000 in incentives on the Rogue. These rebates can be applied directly to the purchase price or used to reduce your down payment.
Low or 0% APR financing is also making a comeback. Brands like Honda, Subaru, and Hyundai are promoting 0% APR for 36 or 48 months on select SUVs. This can save you thousands in interest over the life of the loan, especially if you’re financing a $40,000+ vehicle.
How to Negotiate in Today’s Market
Even with more inventory and incentives, it’s still important to negotiate. Start by researching the invoice price (what the dealer paid) using tools like Kelley Blue Book or Edmunds. Aim to pay close to invoice, especially if the vehicle has been on the lot for 30+ days.
Don’t be afraid to walk away. With more choices available, you have leverage. If one dealer won’t budge, another might. Also, consider timing your purchase at the end of the month, quarter, or year—when sales teams are trying to meet quotas and may offer better deals.
Tips for Buying an SUV in 2024
Whether you’re buying new or used, here are some practical tips to get the best deal on an SUV this year:
- Shop online first: Use manufacturer websites and third-party platforms to compare prices, check incentives, and even start the buying process from home.
- Get pre-approved for financing: This gives you negotiating power and helps you avoid high dealer rates.
- Consider total cost of ownership: Factor in insurance, fuel, maintenance, and depreciation—not just the sticker price.
- Test drive multiple models: SUVs vary widely in ride quality, space, and features. Don’t rush the decision.
- Watch for end-of-year clearance events: Many dealers offer deep discounts in November and December to clear out current-year inventory.
Conclusion: Yes, Car Prices Are Going Down—But Stay Smart
So, are car prices going down in 2024? The answer is a cautious yes—especially if you’re flexible about new vs. used, timing, and financing. While we’re unlikely to return to pre-pandemic price levels anytime soon, the market is becoming more buyer-friendly. Improved inventory, cooling demand, and renewed incentives are all working in your favor.
For SUV shoppers, this means more choices, better deals, and greater negotiating power than we’ve seen in years. Whether you’re after a rugged off-roader, a fuel-efficient hybrid, or a family-friendly three-row SUV, 2024 offers real opportunities to save. Just remember to do your research, compare options, and take advantage of incentives while they last.
The road ahead looks smoother—and more affordable.
Frequently Asked Questions
Are new car prices dropping in 2024?
New car prices are stabilizing and, in some cases, slightly declining due to improved inventory and higher interest rates. While they haven’t returned to pre-pandemic levels, the rapid price increases of the past few years have slowed significantly.
Is now a good time to buy a used SUV?
Yes, 2024 is a great time to buy a used SUV. Prices have dropped 8–12% compared to last year, and certified pre-owned models offer excellent value with added warranties and peace of mind.
Will electric SUV prices continue to fall?
Yes, electric SUV prices are expected to keep declining as battery costs drop and competition increases. Government incentives also make EVs more affordable for many buyers.
What SUVs have the best deals in 2024?
Models like the Toyota RAV4, Honda CR-V, Hyundai Tucson, and Ford Escape are seeing strong incentives, including cash rebates and low APR financing. Electric options like the Tesla Model Y and Ford Mustang Mach-E also have competitive pricing.
How can I get the best price on a new SUV?
Research invoice prices, shop at the end of the month or year, get pre-approved for financing, and take advantage of manufacturer rebates and dealer incentives.
Do higher interest rates offset lower car prices?
Higher interest rates can increase monthly payments, so even if the car price is lower, your total cost may rise. Shop around for the best loan rates and consider shorter loan terms to minimize interest.