#USA #Atlanta #Cox Automotive #vehicle sales #Auto Industry

U.S. Auto Sales Forecast for January 2025

As the automotive market adjusts to seasonal shifts, the latest forecast from Cox Automotive highlights a projected rise in new vehicle sales for January 2025. Anticipating sales to reach approximately 1.125 million units, this figure marks a 5.2% increase compared to the same month last year, even as it represents a notable drop of 25.3% from December’s sales.

Monthly Sales Dynamics

The expected new-vehicle sales pace for January indicates a seasonally adjusted annual rate (SAAR) of about 15.8 million. This rate reflects an increase from January 2024's pace of 15.0 million, even while showing a decline from December’s impressive 16.8 million—a seasonal norm as January traditionally ranks among the slower months for auto sales. Senior Economist Charlie Chesbrough notes that while sales have been robust recently, driven by heightened consumer demand post-election, a dip in sales is typical for this time of year due to multiple factors, including adverse weather conditions and historical performance trends.

Impact of Weather and Economic Trends

The harsh winter weather noted nationwide is expected to impact buyer activity, although the full extent remains to be measured. January's forecast indicates a compression in sales, primarily due to the effects of snow and cold, which often discourage consumer outings. In the previous year, sales were boosted by restored inventory levels and competitive dealer incentives, making the decline less alarming in this context.

Despite this month-to-month dip, new-vehicle sales have shown resilience, with four consecutive months of year-over-year growth—a trend Cox anticipates will continue throughout 2025. Current estimates suggest that total annual sales could reach approximately 16.3 million units by the end of this year.

Inventory Levels and Market Conditions

According to vAuto Live Market View data, new vehicle inventory at the beginning of January has settled at around 2.88 million units, the first drop below 3 million since late October 2024. This signals tighter supply conditions in the market, indicating that while inventory levels are reduced, they are still favorable relative to the previous year, inviting a strategy of enhanced incentives to stimulate buyer interest.

The segment-wise breakdown shows varied trends; compact SUVs and full-size pickup trucks show healthy year-over-year growth rates, albeit with significant drops compared to December sales. As illustrated:

• - Compact SUV/Crossover Sales: Projected at 200,000 vehicles, up 6.3% from January 2024, but a significant decline of 25.1% from December.
• - Full-Size Pickup Trucks: Expected sales are 165,000, reflecting a 14.5% increase from the previous January but also a 26.1% dip month-over-month.
• - Compact Cars: A drop is anticipated, with expected sales of about 70,000 vehicles, down 11% year-on-year.

Looking Ahead

As 2025 progresses, Cox Automotive is cautiously optimistic about the overall direction of the auto sales market. Positive economic growth alongside improved consumer buying conditions is critical in sustaining sales increases. However, potential disruptions stemming from policy changes related to tariffs and electric vehicle incentives could bring uncertainty, especially in the latter half of the year.

Cox Automotive continues to leverage its extensive data resources and advanced analytics to support stakeholders across the automotive landscape. With over 29,000 employees and a portfolio of prominent brands such as Kelley Blue Book and Manheim, Cox positions itself at the forefront of automotive services and technology solutions.

The January 2025 outlook signifies important developments in the automotive sector as it navigates seasonal challenges while leveraging growth in demand and inventory stability. Observers will be keen to see how external factors influence these trends as the year unfolds.