New car sales in San Diego — as well as California — are stuck in neutral this year, as high sticker prices and burdensome financing costs keep a sizable number of potential customers away.

Registrations in the state for new vehicles through the first nine months of 2024 were down 1.7% compared to the first three quarters of last year, according to data from the California New Car Dealers Association, while national sales figures were up 2.7%.

San Diego County figures were slightly better than statewide numbers, but only slightly — down 0.7% through the first three quarters.

“Looking at our economist’s analysis of a market, it feels like we’ve reached a new sales plateau,” said Brian Maas, president of the car dealers association.

According to Edmunds.com, the average price of a new vehicle in the U.S. as of September climbed to $47,431 and the average price of an all-electric vehicle came to $59,723. Even used cars are not very cheap, with the Edmunds average coming to $27,422.

“You literally cannot buy any vehicle today for the same price that you bought it five or six years ago,” said Ivan Drury, senior manager of auto insights at Edmunds. “And financing is a huge problem now.”

While the Federal Reserve lowered interest rates in September as inflation has cooled, Edmunds data show that as of last month, the average interest rate to finance a new car in the U.S. came to 7.3% and the average monthly payment was $742.

“It’s like consumers are getting hit left and right,” Drury said. According to Edmunds’ analysis, in the third quarter of this year, the average vehicle in the U.S. is on the lot 57 days before it gets purchased, compared to 37 days during the same time last year.

The California New Car Dealers Association anticipates the number of registrations in 2024 will come to about 1.75 million, which is slightly lower than the 1.77 million recorded last year. That’s a far cry from state sales figures that hovered around 2 million registrations per year prior to the pandemic.

The industry hopes that pent-up demand will eventually entice consumers back into a buying mode, especially if interest rates continue to decline.

The third quarter numbers reflected mixed messages for California’s hoped-for transition from gasoline-powered cars and trucks to electric vehicles.

On the positive side, all-electric battery and plug-in hybrid vehicles combined to make up 25.6 percent of the market in new vehicle sales and leases through the first nine months of this year — by far the highest numbers for any state.

But the rate of adoption of battery-electric vehicles, or EVs, has increased just seven-tenths of a percentage point through the third quarter of this year compared to 2023 and the market share of plug-in hybrids was flat — 3.4 percent in 2023 and 3.4 percent through Q3.

Four years ago, Gov. Gavin Newsom issued an executive order mandating the elimination of sales of all new gasoline-powered passenger vehicles in California by 2035. And in fewer than two years, the first of a series of state-imposed targets will start rolling out.

Under standards passed by the Air Resources Board, at least 35 percent of model year 2026 passenger cars and trucks sold in the state must be electric vehicles, plug-in hybrids or hydrogen fuel cell vehicles. The numbers ramp up each year, going to 68% in 2030 and 100% by 2035.

“As the mandates kick in, are there going to be enough customers to support the requirements that the mandate requires?” Maas said. “Sales continue to go up, but they’re not going up by leaps and bounds.”

Under definitions set by state policymakers, battery-electric, plug-in hybrids and hydrogen fuel cell vehicles qualify toward meeting California’s zero-emission target.

Hybrid vehicles that do not have plug-ins have been posting robust sales figures — not only in the Golden State but across the country — but they do not count under the state’s mandate because they use gasoline.

The third-quarter numbers showed the top-selling car across the state is still the all-electric Tesla Model Y. It racked up more than twice the number of registrations than California’s No. 2-selling car, the Toyota RAV4. The Tesla Model 3 finished sixth.

But statewide registrations for all Tesla models are down 12.6% compared to last year.

Analysts have offered a number of possible reasons why — including the potential sales effect of Tesla founder Elon Musk weighing in political issues after buying X (formerly Twitter) and actively campaigning for Donald Trump for president.

But Drury thinks a primary reason is simply because the number of EVs available is expanding, as other carmakers roll out their own models.

“There’s more competition,” he said. “The Model Y is kind of like the default purchase versus the Model 3 when you’re looking at the Tesla lineup, so it’s kind of a cannibalization of sales there.”

Behind the Model Y and Model 3, the Hyundai Ioniq 5 was No. 3 among top-selling zero-emissions vehicles in California through the third quarter with 11,711 registrations. The Ford Mustang Mach-E finished fourth, with 8,013.

Top-selling models in California

(for 2024, through September)

1. Tesla Model Y     105,693
2. Toyota RAV4        49,810
3. Honda Civic          40,741
4. Toyota Camry       40,025
5. Honda CR-V          37,759
6. Tesla Model 3        37,219
7. Toyota Corolla       29,341
8. Chevy Silverado    28,029
9. Ford F-Series         26,753
10. Honda Accord        25,240

Sources: California New Car Dealers Association and Experian Automotive