Each year in November in conjunction with the release of the October producer price index, the Bureau of Labor Statistics releases a report on the dollar value of quality changes for motor vehicle models in the upcoming model year.
The November 2023 release is for the 2024 model year. The numbers support a trend that began in the mid-1990’s when consumers’ appetites for vehicles in the light trucks category – which includes minivans, SUVs, and crossovers – left passenger cars with a much smaller share of sales. Manufacturers took note and light trucks received more upgrades in terms of comfort and safety consistent with increasing use as a family vehicle. By 2020, light trucks regularly accounted for 75 percent or more of all sales.
This year the report for 2024-model-year domestically produced passenger cars included in the PPI basket had an average of $76.07 increase in quality adjustments, or 6.4 percent of the average $1,180.15 increase in manufacturers’ invoice prices. The retail equivalent is an increase of $80.48, or about 6.5 percent of the $1,237.42 increase in the list price compared to a year ago. Retail quality changes include safety equipment, powertrains, and changes in levels of standard or optional equipment, the BLS said.
The value of quality changes for 2024 light trucks averaged $230.98 in the October PPI. This is 11.3 percent of the $2,044,80 average increase in manufacturers’ invoice price change from last year. The retail equivalent is $245.19, or 11.4 percent of the average $2,155.62 manufacturers’ suggested list price compared to a year ago. The quality change is in improvements to powertrain and infotainment systems, and changes in levels of standard or optional equipment.