New-vehicle prices fell in September as inventory continued to swell and consumers get squeezed by high interest rates.

The average U.S. transaction price dropped 0.7% year-over-year to $47,899, down 3.4% from the peak of almost $50,000 reached in January, Cox Automotive agency Kelley Blue Book said. That was down 0.5% month-over-month.

“Dealers and automakers are feeling price pressure, and with auto loan rates at record highs and growing inventory levels, new-vehicle prices continue to ease,” said Cox Research Manager Rebecca Rydzewski. “Assuming the (United Auto Workers) strike is short-lived, current inventory levels are healthy enough to prevent any significant impact on consumer prices.”

Luxury prices were also down, led by price cuts this year by U.S. electric-vehicle market leader Tesla, Cox said. The average price fell 6.2% year-over-year to $62,342, which is nearly 7% below where it started the year. It said Tesla’s average transaction price was down about 25% year-over-year, balancing out price increases by many other luxury carmakers.

The average nonluxury price was about flat month-over-month at $44,626, up just 1% year-over-year, Cox said.

Bucking a trend of increased incentives this year with revived inventories, General Motors cut incentives on its four big brands in September, as its inventory is well off those of Detroit rivals Ford and Stellantis, which both raised incentives last month, Cox said. All are facing strikes by the United Auto Workers that could affect production over the long haul. The average industry incentive reached $2,368, a 24-month peak.

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