New light-vehicle sales in February reached a SAAR of 15.8 million units, down 1.4% year-over-year. While the sales pace improved compared to January 2026, significant winter storms continued into February and affected sales somewhat in the mid-Atlantic and Northeast regions. The sales pace is expected to accelerate in March as competition between OEMs heats up in the last month of the quarter.

• Battery electric vehicle (BEV) market share totaled 6.3% year-to-date through February, down 1.5 percentage points compared to the same period last year. BEV market share has yet to return to levels seen in 2025, before the expiration of federal BEV tax credits. And this is despite OEMs allocating significantly more incentive spending to their BEV products. According to JD Power, the average discount on BEVs should total $10,356 in February, while discounts on non-EVs should total $3,085. Meanwhile, sales of conventional hybrids have performed well, with market share totaling 13.6% year-to-date in February, an increase of 1.5 percentage points year-over-year.
• Discussions about vehicle affordability have permeated the auto industry as consumers cope with rising payments. According to JD Power, the average monthly payment in February should total $811, up $32 year-over-year. One strategy some consumers have been using to manage higher payments is extending their loan terms. JD Power notes that more consumers are choosing 84-month loans, which should represent 12.7% of financed sales in February, up from 7.7% in February 2025.
• While the Iran conflict is unlikely to have significant impacts on the auto industry in the short term, there certainly are risks depending on the duration of fighting in the region. The conflict could result in higher energy prices, which can lead to increased prices for production inputs and potential supply disruptions. 
• So far this year average tax refunds are up roughly 10%, according to the Tax Foundation. Because of higher refunds, we expect a bigger-than-usual boost this spring to used-vehicle demand, as well as potentially a small boost to new-vehicle sales. Looking ahead to the end of the year, we expect new light-vehicle sales will total 16.0 million units in 2026.

New light-vehicle sales started off 2026 by reaching a January SAAR of 14.9 million units, a 4.1% decline year-over-year and the lowest monthly SAAR since January 2024. Sales in the final two weeks of the month were impacted by severe winter storms, which left many pockets of the country stuck under major snow and ice that dampened store traffic. 

• J.D. Power estimates that new-vehicle discounts fell in January. Average incentive spending per unit totaled $3,335, a 5.6% increase compared to January 2025, but down 5.5% compared to December 2025. As a share of MSRP, average incentive spending per unit reached 6.6%. Prior to the pandemic, average OEM discounts were closer to 10% of MSRP, so OEMs likely have room to raise discounts to juice demand if they choose.
• Battery electric vehicle (BEV) market share in January reached 6.6%, a decline of 1.9 percentage points compared to January 2025. With no federal EV tax credits in 2026, we will be paying close attention to any shifts in BEV sales and market share. Conventional hybrids continued to sell well in January, with market share at 12.6%, an increase of 0.5 percentage points year-over-year. 
• At the end of January, new light-vehicle inventory on the ground and in transit totaled 2.53 million units, down 9.2% year-over-year and down 2.0% compared to December 2025. We expect new light-vehicle inventory to hover between 2.5 million and 2.6 million units in the first half of the year before rising the rest of the year. Our outlook for new-vehicle sales in 2026 is 16.0 million units.

New light-vehicle sales totaled 16.2 million units in 2025, an increase of 2.4% compared to 2024. The US auto industry experienced several shocks last year, including tariffs on imported vehicles and parts as well as the end of the EV tax credits. But tariff announcements induced some consumers to pull ahead purchases in Q2 and buy a vehicle before the tariffs took effect. And the expiration of EV tax credits on September 30 spurred buying activity in Q3, leading to a record-high monthly market share for battery electric vehicles (BEV) of 11.8%. 

• While BEV market share reached an all-time high in September, sales cooled significantly once tax credits were no longer available. By December, BEV market share fell to 5.9%, a decline of 5.9 percentage points compared to the record set in September. For all of 2025, BEV sales total 1.26 million units, an increase of 1.2% compared to 2024. Despite the increase in BEV sales, BEV market share declined year over year by 0.1 percentage points to 7.7% in 2025.
• Meanwhile, sales of conventional hybrid vehicles increased significantly in 2025. Conventional hybrid sales reached 2.05 million units, up 27.6% year over year. Given the changes in the regulatory landscape, we expect BEV sales growth to continue to cool and hybrid sales to increase as OEMs build vehicles with powertrains more in line with current consumer demand. 
• Despite concerns of significant price increases due to tariffs, average transaction prices increased modestly as most OEMs absorbed much of the additional costs. According to J.D. Power, the average transaction price for a new light vehicle in December 2025 should total $47,104, up 1.5% compared to December 2024. The average monthly payment on a new-vehicle finance contract in December 2025 will likely reach $776, an increase of $22 compared to December 2024. Payment increases were somewhat muted as average interest rates declined slightly during the year. J.D. Power estimates the average interest rate on a new-vehicle finance contract will be 5.84% in December 2025, a decrease of 32 basis points year over year. 
• Looking ahead to 2026 we are optimistic about new-vehicle sales, though there will certainly be challenges as the industry adjusts to evolving regulatory and trade environments. With the passage of the One Big Beautiful Bill last year, we expect tax season will provide a solid boost to consumer spending and be a tailwind for new-vehicle sales. However, a lackluster labor market may cause some consumers to wait before buying a new vehicle. Still, we expect a solid year for new light-vehicle sales, with a forecast of 16.0 million units in 2026.

New light-vehicle sales in November 2025 were down year-over-year for the second month in a row. The November 2025 SAAR of 15.6 million units represents a decline of 5.5% compared to November 2024 but was a slight improvement over the October 2025 SAAR of 15.3 million units. The industry is still dealing with the aftermath of significant pull-ahead sales volume that occurred as consumers bought vehicles earlier this year before the expiration of the EV tax credits and before tariff-related price increases took effect. 

• November was the second month without the EV tax credit, and BEV market share continued to fall—reaching 5.1% of all new vehicles sold, which was less than half the all-time high of 11.3% in September. Discounts remain high on EVs, with J.D. Power estimating that the average EV incentive per unit will total $11,869 in November. Overall average incentive spending per unit is expected to show an increase of $375 from October, reaching a total of $3,211 for November.
• J.D. Power estimates that the average new-vehicle retail-transaction price will total $46,029 in November, up $722 year over year. The average new-vehicle monthly payment in November is set to reach $760, a record for the month of November in any previous year. Those with trade-ins will be helped as used-vehicle values have been increasing recently. The industry leased significantly fewer cars three years ago due to the semiconductor microchip shortage, leading to tight supplies of late-model used inventory available today. Rising used-vehicle values should help those consumers with a trade-in vehicle.
• Despite the slowdown in sales so far in Q4, we expect new light-vehicle sales to finish the year at 16 million-plus units, given the strong sales performance earlier this year.

New light-vehicle sales in October 2025 recorded the lowest SAAR in 15 months. The October 2025 SAAR of 15.3 million units represents a decline of 4.8% year over year and 5.9% compared to September 2025. The SAAR decrease was primarily driven by the decline in battery electric vehicle (BEV) sales, which fell significantly in October 2025 following the end of the EV tax credits on September 30. 

• BEV sales represented just 5.9% of new-vehicle sales in October 2025, down from the all-time high of 11.3% in September 2025. BEV sales in October 2025 totaled just under 75,000 units, a decline of 46.7% compared to September 2025 and down 23.8% year over year. The expiration of the EV tax credits in September pulled ahead many EV sales that likely would have occurred later. The decline in BEV sales could have been more severe without several OEMs increasing their own incentives in October to help make up for the loss of the federal credit. According to J.D. Power, average incentive spending per unit on BEVs totaled $13,161, up $2,047 compared to September 2025. It remains to be seen what the natural demand for BEVs will be in the absence of the credit, but we do expect it will take quite some time for BEV sales to reach the rate they were in the final months of the EV tax credits.
• Our outlook for the rest of the year is for a slower sales pace relative to Q3 2025. Given the pull-ahead sales that occurred earlier this year, a slower Q4 won’t necessarily impact full-year sales totals too much. We expect sales will be flat or up slightly compared to full-year 2024.

New light-vehicle sales in September 2025 reached a SAAR of 16.4 million units, up 3.5% year over year. September was a solid sales month as many consumers headed to dealer lots before EV tax credits expired on September 30. Battery electric vehicle (BEV) sales hit an all-time high in market share and accounted for 11.8% of all new vehicles sold. This market share was up nearly two percentage points from August 2025, which was also a strong month for BEV sales. Year-to-date, BEV sales accounted for 8.4% of all new vehicles sold, an increase of 0.7 percentage points compared to the same period last year. And for third-quarter 2025, BEV sales increased 24.1% year over year. Plug-in hybrid (PHEV) vehicles, which were also eligible for the tax credits, didn't perform nearly as well as BEVs. PHEV sales in September 2025 accounted for just 1.7% of all new vehicles sold, which is right in line with their year-to-date market share of 1.8%.

• The average discount on a new vehicle increased slightly from August to September. According to J.D. Power, average incentive spending per unit should totaled $3,116, up just $24 compared to August 2025. J.D. Power notes that more incentive spending was targeted at EVs. Expressed as a share of the average MSRP, overall incentive spending is expected to be 6.1%, while incentive spending for non-EVs should reach just 4.8%. New light-vehicle inventory on the ground and in-transit totaled 2.65 million units at the end of September 2025, up by 6.2% compared to August 2025 but down 5.9% year-over-year. Looking ahead, we expect inventory levels to end the year slightly below their levels at the end of Q3.
• New light-vehicle sales have been solid so far through the third quarter, with a year-to-date SAAR of 16.4 million units—an increase of 4.7% year over year. We believe there has been some significant pull-ahead volume, as consumers rushed to dealer lots earlier in the year before tariffs took effect and in recent months as consumers purchased EVs before the end of tax credits. The big question now: Will volume hold in the final quarter of the year and into next year as 2026 models arrive on dealer lots? We have already seen several OEMs release price increases in the mid-single-digit percentage range for 2026 models, and we are watching closely to see how much—and when—OEMs will pass along tariff-related price increases. Given the strong sales performance so far, we have increased our 2025 sales forecast to 15.9 million units.