The US auto market witnessed a growth in new car sales in 2024, surpassing the numbers from the COVID-19 pandemic era. This improvement can be attributed to improved dealer inventory, attractive incentives, and a surge in demand for hybrid vehicles among American consumers.
According to Wards Intelligence, Americans purchased a total of 15.9 million new vehicles last year, reflecting a 2.2% increase from the previous year. This is the highest number in the past five years, since 2019. Auto manufacturers predict that this strong growth trend will continue into 2025, despite some automotive policies proposed by the newly elected President Donald Trump.
“We are carrying significant momentum into 2025,” said Rory Harvey, Global Market President of General Motors (GM) in a press release. In 2024, GM retained its title as America’s largest automaker, with sales reaching 2.7 million vehicles, a 4.3% increase.
Most automakers reported positive sales figures last year as they adjusted to the slower demand for electric vehicles and relied on their core business of gasoline-powered trucks and SUVs. Additionally, some companies benefited from the growing consumer interest in hybrid vehicles.
Hybrid Vehicles in High Demand
Traditional hybrid vehicle sales in the US surged by 36.7% in 2024, according to Wards. Toyota announced a 3.7% sales growth in the US market compared to 2023, attributed to the steady performance of reliable compact vehicles like the Camry and RAV4, as well as their hybrid offerings. Reuters reported last year that the automaker might transition its entire product lineup to hybrids.
“Our hybrids are selling out. Customers want them, and we don’t have enough to sell,” said David Christ, Toyota’s North American sales and marketing manager. “Demand for electric vehicles isn’t that high, despite big incentives from the manufacturer and the federal government.”
Ford also benefited from the sales growth of hybrid vehicles. In 2024, their total sales increased by 4.2%. The company, based in Dearborn, Michigan, sold 187,426 hybrid vehicles to Americans, double the number of electric vehicles (97,865).
Automakers have cut back or adjusted their production plans for electric vehicles as demand fell short of predictions. However, they remain focused on attracting new electric vehicle buyers.
On January 3, 2025, Ford announced an extension of its program offering a free home charger and installation to customers who purchase their electric vehicles until the end of March. In 2024, Ford’s electric vehicle sales in the US surged by 34.8%.
Cox Automotive, a market research company, predicts that electric vehicle sales in the US are expected to reach 1.3 million units, accounting for about 8% of total new vehicle sales. Compared to 2023, there has been a slight increase in the number of consumers willing to switch to electric vehicles. According to Cox, American consumers purchased 1.2 million electric vehicles, representing 7.6% of the total market share.
If the Trump administration follows through with its plans to reverse Joe Biden’s electric vehicle policies, including a $7,500 tax credit for certain electric vehicles and increased import tariffs from Mexico and Canada, US auto sales this year could take a hit.
Stellantis and Tesla Fall Behind
Stellantis and electric vehicle giant Tesla were exceptions last year, reporting lower sales compared to 2023. Stellantis had a particularly challenging 2024 in the US market, selling 15% fewer vehicles. On January 3, the company reported that popular brands under its umbrella, including Ram, Jeep, and Dodge, all experienced sales declines. The French-Italian automaker has been dealing with the aftermath of its pricing strategy and the sudden departure of former CEO Carlos Tavares.
Meanwhile, Tesla faced a slowdown in sales due to an aging product lineup and intensifying competition in the Chinese market. The electric vehicle pioneer reported a rare decline in deliveries for 2024, selling 1.789 million vehicles, down from 1.81 million in 2023.
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