US new vehicle sales set to rise 7.3% in December, report says

(Reuters) – U.S. new vehicle sales are expected to rise 7.3% in December, aided by deeper discounts from automakers and dealers, industry consultants J.D. Power and GlobalData said in a joint report on Thursday.

WHY IT’S IMPORTANT

he rise in December sales points to a resilient new-vehicle market, which faces pressure from high interest rates. However, the 7.3% increase is smaller than the 13% rise projected last December by the consultants..

KEY QUOTES

“While per-unit (vehicle) profits are declining, resilient consumer demand—assisted by increased inventory and leasing activity—has supported a solid year-end performance,” said Thomas King, president of the data and analytics division at J.D. Power.

BY THE NUMBERS

December total new-vehicle sales are projected to rise to 1,520,000 from last year, though the month has one lesser selling day compared to previous year.

The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is expected to be 17.2 million units, up 1.1 million units.

EV SALES

Consumer interest in electric vehicles is waning. Only 25% of new car buyers are considering an EV for their next purchase, a 2% decrease from last year.

This decline is also impacting Tesla (NASDAQ:TSLA), which has seen its share of EV sales shrink in 2024.

WHAT’S NEXT

US auto sales are set to hit 16.18 million units in 2025, up 1.2% from this year, according to a separate report from S&P Global Mobility.

“Unfortunately, the new vehicle affordability issues that coalesced to constrain auto demand levels for much of 2024 will not be resolved quickly in 2025,” said Chris Hopson, manager of North American light vehicle sales forecasting for S&P Global Mobility.