US auto sales for 2025 are expected to be the best since 2019

DETROIT – New car sales in the United States are expected to rise next year to their highest level since 2019, driven by lower interest rates and improving affordability, according to industry analysts.

Cox Automotive expects new light-duty vehicle sales to reach 16.3 million in 2025, slightly higher than S&P Global Mobility and Edmunds' forecast of 16.2 million sales next year. These sales will rise from expectations of 15.9 million to 16 million this year and represent the highest results since Nearly 17 million in 2019.

This would equate to an expected sales increase in new cars and trucks of 2.5% or less. This increase is expected to be driven by continued “normalization” of vehicle inventories, incentives/rebates from automakers, and easing financing and loan rates.

“Consumers are still feeling the pinch, but the market is a slightly friendlier place for car shoppers than it was at the beginning of the year,” Jessica Caldwell, Edmunds' head of insights, said in a statement released Tuesday.

Entry-level, less expensive vehicles are expected to be one of the largest growth markets. The industry has been engaged Years of high prices Inventories have declined since the coronavirus pandemic.

Edmunds Reports The average transaction price for new vehicles was $47,465 in 2024, down 0.8% compared to $47,851 in 2023, and up 27.2% compared to $37,310 in 2019.

This is despite an expected year-over-year decline at the leading US electric vehicle company TeslaThe company's sales for the first time since 2014.

“The big three are Tesla and Hyundai Motor Group GMWith GM having the largest year-over-year market share increase of 2.7% at the brand level. “Even though Tesla's market share has dropped to less than 50%, the Model Y and Model 3 still hold the top two spots,” Stephanie Valdez Streety, Cox's director of industry insights, said Tuesday. Tesla.”

Cox expects nearly 25% of new vehicle sales to be electric in 2025, including more than 10% of fully electric models.

Valdez-Streetti and others have warned that electric vehicle sales could be weaker if federal consumer credits for purchases of vehicles worth up to $7,500, as the Trump administration has approved, are ended. He vowed to kill.

Analysts warned that regulatory uncertainty ahead of the president-elect Donald TrumpIts opening may affect new car sales in the United States. Most notably, Trump's tariff threats It could affect automobile production in Canada and Mexico.

Tariffs on those countries, which Trump said could reach 25%, would be a “radical disruption” of the new car market in the United States, said Jonathan Smoak, chief economist at Cox Automotive.

“We know that there are shifts that can come with shifts in policies, but some of the key assumptions we are making are that most of these shifts are likely to take time, and before they are implemented, they are likely to actually increase demand,” Smoak said on Tuesday. “It will be pulled forward,” he said during a virtual press conference. “With regard to tariffs, specifically, we are not making any assumptions that major new tariffs will be implemented.”

An expected increase in new vehicle sales in the United States may actually be a windfall for some automakers' profits next year due to higher incentive rates and an expected decline in prices, according to Wall Street analysts.

“We continue to see signs that pricing is not sustainable,” Wells Fargo analyst Colin Langan said in a note to investors Monday, citing higher inventories, increased incentives, lower dealer profits per vehicle, and other generally lower pricing powers for automakers. “.

Prices remain at near-record high levels but growth has slowed, which is good for car buyers but bad for businesses.