Next year’s US auto sales are expected to be the best since 2019.

DETROIT — U.S. new vehicle sales are expected to rise next year to the highest level since 2019, led by low interest rates and improving affordability, according to industry analysts.

Cox Automotive expects sales of new light-duty vehicles to reach 16.3 million in 2025, slightly higher than S&P Global Mobility and Edmonds’ forecast of about 16.2 million sales next year. Such sales this year would exceed expectations of 15.9 million to 16 million and mark the highest results since then. About 17 million in 2019.

That would equate to sales forecasts of 2.5% or less in new cars and trucks. The increase is expected to come from continued “normalization” of vehicle inventories, incentives/discounts from automakers, and easing of financing and loan rates.

“Consumers are still feeling the pinch, but the market has become a slightly friendlier place for car buyers than it was at the start of the year,” Jessica Caldwell, head of insights at Edmunds, said in Tuesday’s release.

One of the biggest growth markets is expected to be entry-level and less expensive vehicles. Dealing with industry. Years of high prices And low inventory since the coronavirus pandemic.

Edmonds Reports The average new vehicle transaction price was $47,465 in 2024, down 0.8% from $47,851 in 2023 and up 27.2% from $37,310 in 2019.

According to analysts, another expected growth area is electrified vehicles, including hybrids, plug-in hybrids and all-electric models.

According to Cox, sales of all-electric vehicles in the U.S. are forecast to set another record in 2024, with total sales nearing 1.3 million. That would mark about an 8% market share, up from 7.6% last year but down from expectations of 10% earlier this year.

That’s despite forecasts of a year-over-year decline in the U.S. EV leader. TeslaThis is the first time since 2014.

“The top three manufacturers are Tesla, Hyundai Motor Group and General MotorsWith GM posting the highest year-over-year market share growth at the brand level at 2.7%. Although Tesla’s market share has dropped below 50%, the Model Y and Model 3 remain in the top two spots,” Stephanie Valdez Streeti, Cox director of industry insights, said Tuesday. Participating. Tesla.”

Cox expects about 25% of new vehicle sales to be electric in 2025, including more than 10% penetration for all-electric models.

Valdez-Strati and others warned that EV sales could be weakened if the federal consumer credit for vehicle purchases of up to $7,500, which the Trump administration has in place, is eliminated. Vow to kill.

Analysts warned there was regulatory uncertainty before the president was elected. Donald TrumpNew American vehicle sales could be affected by the opening of the in particular, Trump’s Tariff Threats Vehicle production in Canada and Mexico may be affected.

Jonathan Smoak, chief economist at Cox Automotive, said tariffs on those countries, which Trump has said could be as high as 25 percent, would be a “fundamental drag” on the U.S. new vehicle market.

“We know there may be some twists and turns with policy changes, but some of the key assumptions we’re making are that most of these changes are likely to take time, and before they take effect, In fact, there will be an increase in demand,” Smoak said during a virtual briefing on Tuesday. “As it relates to tariffs, in particular, we are not anticipating that major new tariffs will be implemented.”

Expected growth in U.S. new vehicle sales could be a drag on earnings for some automakers next year due to higher stimulus rates and expected price cuts, according to Wall Street analysts.

“We continue to see signs that pricing is not sustainable,” Wells Fargo analyst Colin Langan said in an investor note on Monday, “in rising inventories, rising incentives, dealer profits per vehicle.” citing shortages and other overall lower pricing power for automakers.

Pricing is near record highs but growth has slowed, which is good for car buyers but bad for companies.