New car sales in the US - Data and Analysis (1980-2032)

New car sales in the US are edging down 0.9% to 16.10 million vehicles in 2026, as high prices and the loss of federal electric vehicle (EV) tax credits weigh on demand even as inventories improve. The expiration of those credits pulled many EV purchases into 2025, leaving a softer base this year, while higher fuel prices and elevated interest rates, including a Federal Reserve rate hike in September, have added to affordability pressures. Still, demand has proved resilient, supported by improving credit availability and steady purchases from higher-income buyers. Buyers are also shifting toward hybrids and passenger cars, favoring Asian brands. The average transaction price for a new vehicle climbed above $50,000 for the first time ever in late 2025, according to Kelley Blue Book, reflecting a mix shift toward high-priced trucks and SUVs and sustained pricing power from manufacturers, which has delayed some purchases and reinforced a record-high vehicle fleet age.New car sales have grown at a compound annual rate of 1.5% over the five years through 2026, as the market navigated a series of sharp swings driven by supply-chain bottlenecks and evolving policy incentives. After a modest rebound in 2021, sales dropped by 8.0% in 2022 as semiconductor shortages constricted output and dealer lots emptied, pushing prices sharply higher and forcing many buyers into the used market or to delay replacement. As chip supplies normalized in 2023 and 2024, automakers rebuilt inventory and worked through backlog demand, allowing sales to climb back toward 16.0 million while also supporting record pricing and profit. In 2025, annual new light-vehicle sales reached 16.2 million units, aided by consumers pulling forward purchases ahead of new tariffs and the sunset of key EV tax credits, which temporarily boosted battery electric vehicle (BEV) volumes before incentives expired. Still, the average age of vehicles on the road increased to 12.8 years in 2025, a record high according to S&P Global Mobility, as higher vehicle prices and elevated interest rates on car loans curtailed new purchases.Electrification reshaped product strategies across the period. Combined sales of hybrids, plug-in hybrids and BEVs steadily expanded their share of the new light-duty market, moving from roughly the low teens in 2022 to more than one-fifth of sales by 2025 as automakers broadened their offerings and regulators tightened emissions rules. Policy design and infrastructure constraints, however, tilted momentum toward conventional hybrids. Once federal EV tax credits lapsed in late 2025, BEV market share slipped back while hybrid volumes accelerated, underscoring consumer preference for electrified powertrains that fit existing fueling habits and alleviate range concerns. Through it all, inflation, elevated interest rates and stricter credit standards kept a lid on overall demand, pushing buyers to hold onto vehicles longer.