News Summary: New car prices drop $500 in June

AP News
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Posted: Jun 27, 2012 4:38 PM
News Summary: New car prices drop $500 in June

THE CHANGE: New car and truck prices have dropped about $500 in the past year, according to the Kelley Blue Book auto pricing service.

THE HISTORY: Prices were high in June 2011 because Japanese automakers, mainly Honda and Toyota, had run short of cars. The earthquake and tsunami that hit Japan in March of last year hobbled car and parts-making plants, causing the inventory shortage. With few models on dealer lots, there was no reason for discounts.

WHAT'S NEW: Honda and Toyota factories are back at work and dealers have been restocked. The companies have raised discounts in an effort to draw buyers. The average Honda model, for instance, is selling for nearly $1,200 less than it did last year. Toyota's popular Prius gas-electric hybrid is selling for $2,500 less than a year ago.