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US New Cars market report

Everything you need to make the right decisions

Providing the most comprehensive and up-to-date information and analysis of the New Cars market, and the behaviours, preferences and habits of the consumer.

Mintel has the answers you’re looking for

What are the key challenges facing the industry and how fast are its rates of growth? Who is the consumer and what do they want? Where are the opportunities, where are the risks and what lies ahead?

Definition

For the purposes of this Report, a “new car” means any newlyassembled vehicle that has never been titled or registered before purchase and comes with a new vehicle warranty that initiates when the vehicle is sold.

“Car,” as defined for the purposes of this Report, will stand for any of the following vehicles that are bought through retail avenues and are intended for non-commercial use only: sub-compact, compact, mid-sized or full-sized sedans, hatchbacks, or convertibles; compact, mid-sized, or full-sized SUVs (sport utility vehicles); compact, mid-sized, or full-sized crossovers; minivans or MPVs (multipurpose vehicles); compact, mid-sized, or full-sized pickup trucks or vans; any type of hybrid electric, electric, or alternativelyfueled vehicle; any type of luxury vehicle; any type of classic car; or any variation above, so long as it’s for non-commercial usage.

Large trucks and recreational vehicles are not covered, regardless of usage type. The Report also excludes private, or sale by owner vehicle purchases, regardless of vehicle or usage type.

Expert analysis from a specialist in the field

Written by Buddy Lo, a leading analyst in the Automotive sector, his extensive knowledge delivers in-depth commentary and analysis to highlight current trends and add expert context to the numbers.

New vehicle sales through 2017 have confirmed that the auto industry hit “peak auto” in 2016, meaning growth in new vehicle sales will end this year. Despite the slowdown, Mintel estimates a healthy 17 million units will be sold in 2017. The stagnant market means that auto manufacturers will need to gain market share for growth in a shrinking market. This means building high-quality products for their segments and putting forward a marketing message that will increase consideration and lead to shoppers on the dealership lot. Buddy Lo
Automotive Analyst

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • Overview
          • The issues
            • Sales face headwinds, stagnating growth
              • Figure 1: Total US unit sales and fan chart forecast of new passenger cars and new light trucks, 2013-23
            • Abandon car! Shoppers flee to crossover/SUV category
              • Figure 2: Passenger car and light truck sales as a percentage of the market, 2014-18*
            • Dealerships need to differentiate themselves among younger shoppers
              • Figure 3: Attitudes toward new vehicles, by age, April 2018
            • The opportunities
              • New vehicle purchase consideration remains high
                • Figure 4: Purchase type, April 2018
              • Repairs, technology, and perks can convert used car shoppers
                • Figure 5: New vehicle factors, by purchase type, April 2018
              • Millennials remain dominant car-buying demographic
                • Figure 6: Purchase intent, by generation, April 2018
              • What it means
              • The Market – What You Need to Know

                • New vehicle sales stable but flat for near future
                  • Crossovers sap sales from passenger car segment
                    • Rising interest rates will increase costs for shoppers
                      • Trade disputes could turn on hazard lights for the auto industry
                        • Mobility services provide consumers options besides a personal vehicle
                        • Market Size and Forecast

                          • New vehicle sales stagnant for near future
                            • Figure 7: Total US unit sales and fan chart forecast of new passenger cars and new light trucks, 2013-23
                            • Figure 8: Total US unit sales and fan chart forecast of new passenger cars and new light trucks, 2013-23
                        • Market Breakdown

                          • Crossovers and SUVs drawing shoppers away from sedans and coupes
                            • Figure 9: Passenger car and light truck sales as a percentage of the market, 2014-18*
                          • Leasing penetration drops slightly year over year
                            • Figure 10: Leasing as a percentage of new vehicle sales, Q1 2017-Q1 2018
                        • Market Perspective

                          • Emerging mobility options may inhibit new vehicle purchases
                            • Subscription services provide a flexible alternative to vehicle ownership
                            • Market Factors

                              • Increasing interest rates increase borrowing costs for car shoppers
                                • Improving credit scores show higher quality shoppers are in the market
                                  • Figure 11: Average Q1 new credit scores, 2014-18
                                  • Figure 12: Credit score change in past year, May 2018
                                • Gas prices close to $3 per gallon
                                  • Figure 13: US gasoline and diesel retail prices, January 2007-July 2018
                                • Trade disputes cause uncertainty in the market
                                • Key Players – What You Need to Know

                                  • Toyota jumps Chevy for second spot
                                    • Ford remains the top brand in the US
                                      • JoyDrive brings the new car buying process online
                                      • New Vehicle Sales by Brand

                                        • Ford tops US sales as a brand, GM tops US sales as manufacturer
                                          • Figure 14: New vehicle sales, by brand, 2016-17
                                          • Figure 15: New vehicle sales, by manufacturer, 2016-17
                                      • What’s Working?

                                        • Crossovers dominate sales landscape
                                          • Ford top US brand on strength of F-Series
                                            • Toyota grows to take second sales position
                                            • What’s Struggling?

                                              • Passenger car sales suffer amid crossover craze
                                              • What’s Next?

                                                • JoyDrive brings the new car buying experience online
                                                  • Ford bringing back the Bronco and Ranger
                                                    • Brands planning wave of electrified models
                                                    • The Consumer – What You Need to Know

                                                      • New purchase consideration remains high
                                                        • Millennials driving force behind new vehicle purchases
                                                          • Reliability is the most appealing factor behind buying new
                                                            • Younger shoppers less likely to differentiate dealerships
                                                            • Vehicles in the Household & Purchase Intent

                                                              • Vehicle ownership remains ubiquitous in US
                                                                • Figure 16: Number of vehicles in the household, April 2018
                                                              • Sedans found in more than half of US households
                                                                • Figure 17: Types of vehicles in the household, April 2018
                                                              • Rural residents nearly twice as likely to have a pickup truck
                                                                • Figure 18: Types of vehicles in the household, by area, April 2018
                                                              • Consumer lifestyles determine the types of cars in the household
                                                                • Figure 19: Types of vehicles in the household, by recreational item ownership, April 2018
                                                                • Figure 20: Toyota Tundra online mobile ad, March 2018
                                                            • Purchase Intent

                                                                • More than half of consumers plan on buying within three years
                                                                  • Figure 21: Purchase intent, April 2018
                                                                • Consumer purchase intent remains steady
                                                                  • Figure 22: Purchase intent, July 2016-April 2018
                                                                • Major life events accelerate purchase intent
                                                                  • Figure 23: Purchase intent, by major life events, April 2018
                                                                • Millennials are the dominant car buying generation
                                                                  • Figure 24: Purchase intent, by generation, April 2018
                                                                • English-speaking Hispanic Millennials show highest immediate intent
                                                                  • Figure 25: Purchase intent, by Hispanic origin and generation, April 2018
                                                                • Fathers plan further ahead for the next household vehicle
                                                                  • Figure 26: Purchase intent, by gender and parental status, April 2018
                                                              • Next Vehicle Purchase

                                                                • New vs used
                                                                  • Car shoppers aspire to purchase their next car new
                                                                    • Figure 27: Purchase type, April 2018
                                                                  • Household income is the main factor behind new vs used decision
                                                                    • Figure 28: Purchase type, by household income, April 2018
                                                                  • Vehicle types considered
                                                                    • Consideration between sedans and SUVs nearly level
                                                                      • Figure 29: Vehicle types considered, April 2018
                                                                    • Shoppers are more likely to return to the same vehicle category
                                                                      • Figure 30: Vehicle types considered, by types of vehicles in the household, April 2018
                                                                      • Figure 31: Ford Lauderdale Nissan buy back direct email, August 2018
                                                                    • Vehicle Replacement Plans
                                                                      • Nearly 80% of car shoppers plan to replace a current vehicle in the household
                                                                        • Figure 32: Vehicle replacement plan, April 2018
                                                                      • Majority of shoppers replacing a vehicle plan to trade in a current one
                                                                        • Figure 33: Replacement reasons, April 2018
                                                                      • More than a quarter of households with teenagers look to add a car
                                                                        • Figure 34: Chevrolet eNewsletter email, August 2018
                                                                        • Figure 35: Vehicle replacement plan, by presence of children by age in the household, April 2018
                                                                      • Younger shoppers more likely to get a car for themselves
                                                                        • Figure 36: Vehicle replacement plans, by age, April 2018
                                                                        • Figure 37: Purchase type, by replacement vehicle plans, April 2018
                                                                      • Payment plans
                                                                        • One in 10 shoppers plan on leasing their next vehicle
                                                                            • Figure 38: Payment plan, April 2018
                                                                            • Figure 39: Payment plan, by household income, April 2018
                                                                          • Half of shoppers planning to lease have a lease about to end
                                                                            • Figure 40: Replacement reasons, by payment plan, April 2018
                                                                        • New Vehicle Factors

                                                                          • Car shoppers like the reliability a new vehicle brings
                                                                              • Figure 41: New vehicle factors, April 2018
                                                                            • Dealership perks could convince used car shoppers to go new
                                                                              • Figure 42: New vehicle factors, by purchase type, April 2018
                                                                            • Reliability and new vehicle warranty appealing to eight in 10 new car shoppers
                                                                              • Figure 43: TURF analysis – New car attributes, April 2018
                                                                          • Brands Considered

                                                                            • Toyota top brand considered among new car shoppers
                                                                              • Figure 44: Brands considered for new, April 2018
                                                                            • Jeep over indexes among younger car shoppers
                                                                              • Figure 45: Brands considered for new, April 2018
                                                                          • Attitudes toward New Cars

                                                                            • Research is an important part of the consumer purchasing process
                                                                              • Figure 46: Attitudes toward new vehicles, part 1, April 2018
                                                                            • Half agree “made in America” is “American” regardless of the brand
                                                                              • Figure 47: Attitudes toward new vehicles, part 2, April 2018
                                                                            • Younger shoppers less likely to differentiate dealerships of the same brand
                                                                              • Figure 48: Attitudes toward new vehicles, by age, April 2018
                                                                            • Parents more willing to pay new car prices
                                                                              • Figure 49: Attitudes toward new cars, by parental status, April 2018
                                                                          • Cluster Analysis

                                                                              • Figure 50: Cluster groups, April 2018
                                                                            • City Shoppers
                                                                              • Characteristics
                                                                                • Figure 51: Profile of City Shoppers, April 2018
                                                                              • Opportunities
                                                                                • Figure 52: Purchase intent, by cluster groups, April 2018
                                                                                • Figure 53: Purchase type, by cluster groups, April 2018
                                                                              • Budget GenXers
                                                                                • Characteristics
                                                                                  • Figure 54: Profile of Budget GenXers, April 2018
                                                                                • Opportunities
                                                                                  • Figure 55: Brands considered, by cluster groups, April 2018
                                                                                • Empty Suburbanesters
                                                                                  • Characteristics
                                                                                    • Figure 56: Attitudes toward new cars, by cluster groups, April 2018
                                                                                    • Figure 57: Profile of Empty Suburbanesters, April 2018
                                                                                  • Opportunities
                                                                                    • Figure 58: Vehicle types considered, by cluster groups, April 2018
                                                                                    • Figure 59: Brands considered, by cluster groups, April 2018
                                                                                  • Rural Retirees
                                                                                    • Characteristics
                                                                                      • Figure 60: Profile of Rural Retirees, April 2018
                                                                                    • Opportunities
                                                                                    • Appendix – Data Sources and Abbreviations

                                                                                      • Data sources
                                                                                        • Sales data
                                                                                          • Fan chart forecast
                                                                                            • Consumer survey data
                                                                                              • Consumer qualitative research
                                                                                                • Direct marketing creative
                                                                                                  • Abbreviations and terms
                                                                                                    • Abbreviations
                                                                                                    • TURF Analysis

                                                                                                      • Methodology