Pickup truck prices reach record highs

February 3, 2020

Passenger vehicles have never been more expensive, and the most expensive of the bunch are pickup trucks. The erstwhile symbol of the blue collar working class now averages a sticker price above $50,000.

Edmunds called its $49,543 estimate of the average transaction price for pickup trucks in 2019 the highest seen on record.

JD Power pegged the average sticker price of light-duty trucks at $51,700, but that doesn’t factor in the bottom line of what consumers pay.

“There’s usually very large incentives and rebates on trucks,” said Tyson Jominy, VP of data and analytics at JD Power. “After negotiations with dealers and great deals, we knock it down to $42,036.”

Is that still a record?

“Easily,” Jominy said, adding that the average transaction price for all vehicles has gone up about 3% annually since the Great Recession ended in 2009. 

2019 Ford F-150 Limited

2019 Ford F-150 Limited

Pickup trucks on average cost about $11,000 more than other passenger vehicles, and the segment includes the top three best-selling vehicles in America in the Ford F-Series, Ram light-duty pickup, and Chevy Silverado. The full-size, light-duty truck segment accounts for about 15% of new vehicle sales. 

Those stats are less surprising than they are expected by automakers. More and more shoppers are pivoting to larger vehicles such as pickup trucks and SUVs.

“About 70% of the new car market is pickup trucks and SUVs,” Jominy said. “A few years ago it was about 50/50 (light trucks vs. cars)."

It’s no secret that the larger the vehicle, the larger the margins for automakers, which is one reason why pickups often have the most incentives. But the growing popularity of pickup trucks might come down to cultural forces. 

“The two-car household is not as common anymore, so a new truck lets you do it all with one car, a family vehicle, work vehicle, luxury vehicle, all at once,” Jominy said. “The automakers have met a need for one vehicle to do it all. You could be comfy going on a date in the nicest part of town or heading to Home Depot on the weekend.”

The vehicle that may best represent new truck versatility is the redesigned Ram 1500. Not only did it win North American Truck of the Year in 2019, but also Ram trucks also for the first time leapfrogged the Chevy Silverado to become the second best-selling vehicle behind the Ford F-Series in the cutthroat truck wars. 

“The Ram 1500 is just a home run,” Jominy said. “Ram was the fastest growing brand last year (by volume).”

2019 Ram 1500 Limited

2019 Ram 1500 Limited

It may also offer an interesting case study in how and why pickup trucks have gotten so expensive. The 2020 Ram 1500 starts out at a modest enough $33,840 (including $1,695 destination) in rear-wheel drive for the basic Tradesman quad cab with a 6-foot-4 box. A Limited crew cab starts at $55,360 and comes with a 12.0-inch touchscreen, power running boards, air suspension, and heated leather front bucket seats, among other niceties. Tack on $4,000 for four-wheel drive and the larger bed, then add more for some sharper 20-inch wheels, a safety and convenience package, and a V-8 engine over the standard V-6, and it costs just under $70,000. That’s more than double the cost of the base truck.

Technology is one reason for the escalating prices.

“Infotainment and safety technology are really helping push the transaction prices higher,” Jominy said, citing how lane-departure warnings, automatic emergency braking, and forward collision warnings went from single-digit penetration in 2015 to 60% in 2019. “It’s almost impossible to get a new vehicle without (those features). Is it needed? Most people would agree it’s a good thing to have.”

Then are the comforts and conveniences, such as leather-trimmed bucket seats on the Limited, and an available dual pane panoramic sunroof and ventilated rear seats on the Longhorn. 

As for the necessity of more and more features, such as Apple CarPlay and keyless entry, it might be more than a necessity. 

“It’s really damn addictive,” Jominy said. “Once you have it, it’s hard to ever go back.”

2019 Chevrolet Silverado 1500

2019 Chevrolet Silverado 1500

Fortunately for truck buyers, loan companies are more than happy to keep you coming back for the latest and greatest. Truck buyers can stretch out payments from the once common 36-month term to 84-month terms, which Jominy says is most common among truck buyers. 

“If you can extend those payments, then you can afford more,” Jominy said. “It’s like when chocolate and peanut butter met to create Reese’s.”

The modern pickup truck is one pricey peanut butter cup.

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