Annual sales defy disruptions
Sales of new vehicles in the United States increased about 2% in 2025, defying a year marked by repeated disruptions in an industry where unexpected shocks have become increasingly common. Automakers sold roughly 16.2 million vehicles during the year, representing a 2.4% increase compared with 2024.
Strong year-end results for major automakers
Several manufacturers reported robust December sales to close out the year. Toyota posted an 8% increase in U.S. vehicle sales for 2025, supported by strong demand for its affordable models. Hyundai also recorded an 8% annual gain, driven largely by rising interest in hybrid vehicles.
General Motors reported a 5.5% increase in annual sales, helped by demand for large pickup trucks, sport utility vehicles, and electric models. By contrast, Stellantis saw U.S. sales decline 3% year over year, although the company gained momentum in the second half of the year under new chief executive Antonio Filosa.
Tariffs and policy shifts shape buying behavior
The industry faced supply chain disruptions, unpredictable tariffs, and the removal of a $7,500 tax credit for electric vehicles. These factors pushed some consumers to accelerate purchases before potential price increases tied to regulatory changes.
While some automakers raised prices on vehicles produced outside the United States, tariffs did not significantly lift overall vehicle prices. The average new vehicle transaction price in December was estimated at $47,104, up 1.5% from a year earlier.
Affordability remains a central concern
Despite the sales gains, affordability continues to limit demand. Executives from major U.S. automakers are scheduled to testify on the issue before a Senate Commerce Committee hearing in mid-January.
Industry leaders warned that 2026 could be more challenging as economic uncertainty and tariff-related costs weigh on consumers. Toyota executives said prices are expected to rise further this year as those costs feed through to the market.
Electric vehicle sales face headwinds
Electric vehicles were among the most volatile segments of the market in 2025. Policy changes reduced consumer incentives and eased fuel economy and emissions standards, dampening demand and prompting several automakers to scale back EV production plans.
Electric vehicles are expected to account for about 6.6% of U.S. retail sales in December, down sharply from 11.2% a year earlier. Even so, Toyota and Hyundai said they plan to continue investing in EVs, maintaining strategies that previously emphasized hybrids over fully electric models.
