One airline recently offered a $20 one-way flight, televisions are cheaper than before the pandemic and appliances are on sale. After inflation surged to a four-decade high, consumers are finally finding deals.
Supply-chain constraints have eased and manufacturers’ staffing has improved, executives and economists say, helping get production lines humming again and helping push down prices.
At Famous Tate, which sells appliances and other goods across 11 stores in the Tampa, Fla., area, marketing director Jason Horst said that shoppers these days find midrange washing-machine models about $50 to $100 cheaper than they were a year ago. Some manufacturers overproduced during the pandemic-driven demand surge, he said, and the glut led to price drops this fall.
Kendric Tonn, 41 years old, a professional artist from Columbus, Ohio, benefited last month when the washer in a rental house he owns neared its end. He bought a replacement from Lowe’s for $600, a reduced price that included delivery and the hauling away of his old one.
“With the state of everything, I was mentally prepared for it to be more,” he said.
Overall, prices for durable goods—long-lasting items such as consumer electronics—have fallen on a year-over-year basis for five straight months, according to the Commerce Department. For some product categories such as televisions, prices are lower now than before the pandemic, according to Circana, a firm that tracks consumer goods. Grocery and clothing prices have continued to move higher, the Commerce Department data show.
Prices on consumer technology started falling last year as supply-chain delays eased for the typically imported items. Imports from Asia started to flow more reliably into the U.S., and demand dropped since many people had already updated their tech products earlier in the pandemic, said Paul Gagnon, consumer-technology industry adviser for Circana.
Consumers’ appetite for new technology factors into electronics’ pricing and overall sales, and some retailers have said they hope prices will stabilize or rise slightly in the coming year.
At Best Buy, the average selling price of products was flat in the most recent quarter compared with the same period last year, said Matt Bilunas, chief financial officer at the Minnesota-based electronics retailer. “I think we’re starting to lap some of that deflation in that average selling price,” said Bilunas on a call with analysts last month.
Fares have cooled down as some of those constraints eased this year. Airlines added more U.S. flights, using bigger jets and flooding the market with airline seats. But many travelers gave priority to trips abroad this year, and some carriers resorted to discounts to fill domestic flights.
The consumer-price index for airfares has declined in five of the past seven months, and in October the index was 13% lower than it was a year earlier, according to the Bureau of Labor Statistics. As of early December, fare deals for trips over the Christmas holiday averaged around $350 round trip—up 3% from this time last year but down 2% from 2019, according to data from Hopper, a flight-booking app.
Budget airlines, which generally focus on domestic flights, are facing financial struggles as they strain to cover higher costs, including labor. Some have resorted to deep discounts. In a post-Thanksgiving sale, Spirit Airlines offered one-way fares as low as $20 for travel on Tuesdays and Wednesdays—days when airlines often find themselves with unsold seats—on routes including Newark to Miami and Atlanta to O’Hare in the coming months.
Not every ticket is a bargain. Southwest fares rose in the third quarter, up 2.6% from a year ago on average and up 7% from the same period in 2019. But the airline is putting fares on sale somewhat more than in the past, Chief Commercial Officer Ryan Green said last month.
“We have more seats to fill out there,” said Green, adding that Southwest was targeting sales to flights that most need seats filled.
Carriers including Spirit, Southwest, JetBlue and Frontier have discussed plans to tweak capacity to better align with demand next year, which could prevent domestic fares from falling further.
Deals are gradually returning on auto-dealership lots, as vehicle inventory rebounds from the supply chain-driven shortages that led many new car buyers to pay thousands of dollars above the sticker price.
The average price paid for a new vehicle at retail was about $45,300 in November, according to research firm J.D. Power, down from $47,000 in December of 2022. The current average price remains more than $10,000 higher than what it was before the pandemic.
Ford Motor Chief Financial Officer John Lawler said in late November that there is now parity between supply and demand for new vehicles. “We don’t think that there’s any pent-up demand left,” he told investors. “We see, over the next year or so, prices coming down.”
One place where consumers say they are still waiting for relief: the supermarket.
Prices for most foods are still rising or staying high, though some have declined over the past year. Average unit prices of avocados have decreased by double digits, while oranges, lobster and tilapia have declined by single digits, according to data by research firm NIQ. U.S. supermarket prices overall were up 2.1% in October from a year before, the Labor Department said last month.
Walmart, the country’s largest retailer by revenue, sees some nonfood and fresh-food prices falling compared with earlier this year, but shelf-stable food and other consumable prices remain high, Chief Executive Doug McMillon said last month.
Walmart might need to navigate a period of deflation in the months ahead, he said, and while that may require the company to carefully control expenses or adjust its mix of products, shoppers could redirect their savings to other purchases. “We want our customers and members to have lower prices,” McMillon said.
Kroger executives said on a quarterly conference call in November that inflation has returned to low single digits from double digits last year. While some fresh groceries have returned to typical levels of inflation, they said, many packaged items haven’t.
Campbell Soup CEO Mark Clouse said the company has bumped up promotions on its broth and condensed soups, in response to competition and to maintain affordability, particularly for lower-income consumers.
“For the vast majority [of categories] I’m not yet seeing any type of deflation,” Clouse said in an interview. “The encouraging point here is that at least prices have not been going up.”
Sheldon Hechtman, a retiree in Delray Beach, Fla., said the supermarket prices he sees haven’t budged much over the past year. He said he recently bought a package of muffins for more than $5, compared with around $4 several months ago.
“I haven’t noticed anything real dropping,” Hechtman said.
—John Keilman, Sarah Nassauer, Jesse Newman and Christina Rogers contributed to this article.