The news: Auto sales ended 2024 on a high.
The underlying trends: Automakers were helped by a flurry of car-buying activity in Q4. Consumers were motivated by a sense of urgency to secure their vehicles before the implementation of tariffs and the likely rollback of electric vehicle (EV) tax credits.
What’s next for the auto industry: Overall demand for new cars is expected to remain relatively healthy in 2025, thanks to improving affordability, lower interest rates, and rising consumer confidence—although tariffs on Mexican and Canadian imports could throw a wrench into those projections, given that new car prices would likely spike as a result.
But the same can’t be said for the EV market. The rate of adoption is expected to decelerate in the absence of government incentives, since affordability—along with lack of charging infrastructure—remains the biggest barrier to sales.
Go further: For more on what the Trump administration will mean for the EV industry and beyond, read our election report. Or check out our Data Drop: 5 Charts on the State of the Auto Industry.
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