US New-Vehicle Sales Pace Drops to 15.7 Million Amid EV Slump and Tariff Pressures
Cox Automotive forecasts November 2025 new-vehicle sales at 1.27 million units, reflecting a 7.8 percent decline from the prior year as higher transaction prices and reduced electric vehicle incentives curb buyer momentum. The seasonally adjusted annual rate stands at 15.7 million, up marginally from October’s 15.3 million but down from last year’s 16.5 million pace. With 25 selling days in the month, two fewer than October and one less than November 2024, the volume dip underscores a broader Q4 slowdown following a spring surge driven by pre-tariff purchases.
Electric vehicle and plug-in hybrid sales, which peaked at 438,487 units in Q3 after buyers rushed to claim the expiring $7,500 federal tax credit, now face a sharp reversal with Q4 volumes collapsing. This segment accounts for much of the market’s tempered growth, as average new-vehicle transaction prices climb to $46,029, up $722 year-over-year. Loan rates ease slightly to 6.05 percent for new vehicles, down 0.27 percentage points from 2024, yet monthly payments average $760, a $19 increase that strains affordability for mid-tier buyers.
Tariffs implemented earlier in the year, including 25 percent on medium- and heavy-duty trucks and parts effective November 1, elevate costs as tariffed inventory replaces non-tariffed stock. Global automakers anticipate a collective $30 billion hit to 2025 operating profits from these measures, per Moody’s Ratings analysis. Cox Automotive Senior Economist Charlie Chesbrough noted, “The headwinds from higher prices and fewer government subsidies for electric vehicles are finally slowing the market after a surprisingly strong previous six months.”
Year-to-date sales through October average a 16.2 million SAAR, positioning full-year totals at 16.1 million units, a slight uptick from 2024’s 16.0 million but below initial projections. Toyota and Kia buck the trend with strong October performances, the latter setting a monthly record, while General Motors and Stellantis report softer demand in electrified segments. Used-vehicle wholesale prices, tracked by the Manheim Used Vehicle Value Index at 205.0, rise 1.1 percent month-over-month but fall 0.2 percent year-over-year, signaling stabilized resale values amid new-car pricing pressures.
The National Association of Manufacturers urges enhancements to the USMCA to counter supply chain vulnerabilities exposed by tariff shifts and chip shortages. Global sales forecasts adjust downward to 91.4 million units for 2025, a 3 percent gain year-over-year per GlobalData, with U.S. exports facing headwinds from retaliatory measures. J.D. Power data highlights tariff-driven accelerations in earlier buying, contributing to the current inventory normalization.
As December approaches, manufacturers contemplate deeper discounting to clear lots, potentially influencing Q1 2026 momentum. Electric vehicle adoption, now at 8.1 percent of sales through October, requires sustained infrastructure investments to offset subsidy losses. Fleet sales, comprising 22 percent of volume, provide a buffer but cannot fully mitigate retail hesitancy tied to economic uncertainty. Overall, the market’s resilience hinges on interest rate trajectories and trade policy resolutions into 2026.
