#USA #Atlanta #Cox Automotive #new vehicles #sales forecast

A Positive Shift in New-Vehicle Sales Anticipated for February

As we enter February, the forecast for new-vehicle sales is pointing toward a rebound from the previous month's slowdown. According to Cox Automotive, the seasonally adjusted annual rate (SAAR) of sales for February is expected to reach 16.3 million units, marking an uptick from January's 15.6 million and a slight rise from February of last year, which recorded 15.7 million. This represents the sixth consecutive month of year-over-year improvement for the sales pace in the automotive market.

In terms of sales volume, February is projected to see 1.250 million new vehicles sold, reflecting an 11.3% increase from January's figures, although it is a marginal decline of 0.3% compared to the same month last year. This fluctuation is attributed, in part, to an important detail: February of 2025 has one less selling day than the prior year, which influences the sales pace metrics.

Charlie Chesbrough, Cox Automotive’s senior economist, highlights that the new-vehicle market has been robust since the conclusion of the last election cycle, achieving its highest sales pace since spring 2021 at the end of 2024. However, January's sales lagged behind expectations, primarily due to cold weather affecting many regions and significant events such as California wildfires and the presidential inauguration that potentially diverted customers’ attention away from vehicle purchases.

Despite January's downturn, motivations for buyers to return in February are evident. Buyers who postponed their purchases due to weather conditions are expected to contribute positively to sales as they resume their vehicle shopping. The overall economic environment continues to bolster consumer confidence, suggesting a modest growth outlook for the automotive industry through 2025, with a forecast of reaching 16.3 million in new vehicle sales by the end of the year.

However, Chesbrough warns that any policy shifts regarding tariffs and electrical vehicle incentives under the new Trump administration could have adverse effects on this optimistic forecast. Economic indicators show that consumer confidence remains high, supported by stronger job growth and an overall improved economic forecast, which should facilitate a positive buying environment for consumers.

Breakdown by Vehicle Segment

In its February forecast, Cox Automotive also provided a breakdown of anticipated sales across various vehicle segments.

• - Compact SUV/Crossover: Expected sales are projected at 230,000 units—an 11% increase from January but a decrease of 5.1% from February 2024.
• - Mid-Size SUV/Crossover: Estimated at 185,000 units, this segment anticipates a sharp decline of 11.2% compared to last year, but a 12.9% increase from January.
• - Full-Size Pickup Truck: Forecasting 165,000 units sold, this segment shows a slight growth of 3.4% year-over-year and a 9.9% month-over-month increase.
• - Compact Cars: Sales estimates are around 95,000, marking a steady increase from January.
• - Mid-Size Cars: This segment is expected to see a decline of 27.1% over last year, indicating a shift in consumer interest towards other vehicle types.
• - Other Segments: An aggregate of 520,000 units represents a notable rise of 9.4% from February 2024.

Overall, this February release indicates a hopeful turn in the market, with forecasts indicating that automotive sales are on an upward trajectory, potentially benefitting from returning buyers and favorable economic conditions. The anticipated increase in sales volume emphasizes the resilient nature of the automotive market, even in the face of challenging circumstances in January. As Cox Automotive continues to monitor these trends, further adjustments may be made to account for any economic or policy changes going forward.