The past few years have been a bumpy ride for auto sales as we’ve gone through a global pandemic and experienced a chip shortage. If that wasn’t enough, consumers have had to deal with sky rocketing inflation and high interest rates.
That’s a lot, but automakers persevered and some have even experienced record sales. However, there’s always the question of what the future will hold.
Edmunds broke out their crystal ball and are expecting new vehicle sales to remain relatively steady in 2024. While only time will tell what happens, the company is forecasting sales of 15.7 million units, which would be an increase of approximately 1% from the 15.5 million vehicles that are expected to be sold this year.
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Unsurprisingly, electric vehicles are expected to grow in popularity. If projections pan out, 8% of new vehicles sold next year could be EVs. For comparison, that number is expected to be 6.9% this year.
That being said, hybrids could be the real winner as they’re “the more comfortable choice for the majority of Americans seeking electrified options right now.” Edmunds noted hybrid market share increased to 9.7% in November 2023, which is nearly a 100% increase from a year ago. EVs, on the other hand, only climbed 25%.
Putting electrification aside, consumers could get some much-needed relief as the company believes “pricing has peaked, as improved inventory has driven incentives back into the market.” However, consumers looking for affordable new cars could face a “tougher time as those vehicles are selling quicker than their more expensive counterparts.”
It’s also worth mentioning that interest rates could finally fall as the Federal Reserve has indicated there could be as many as three cuts in 2024. That would be a welcome development as rates for new cars have been hovering around 7% for buyers with good credit scores.
