According to a report by Reuters on January 26th, a joint report released by industry consulting firms J.D. Power and GlobalData indicates that U.S. new car sales for January are expected to decrease by 1.5% compared to the same period last year, attributed to seasonal sales slowdown and signs of cooling demand for electric vehicles.
Based on the joint report from J.D. Power and GlobalData, the total sales of new cars in the U.S. for January (including both retail and non-retail transactions) are estimated to be around 1,087,900 units.
Reuters notes that, to maximize year-end sales and incentives, most U.S. consumers prefer to purchase cars in December, thereby reducing car sales in January of the following year.
In January, U.S. consumers are expected to spend nearly $37 billion on new cars, a 2% decrease compared to the same period last year. Incentive spending per vehicle for the month is estimated to be around $2,346, representing a roughly 74% increase from the same period last year. The average transaction price (ATP) for new cars is projected to be $45,106, a decrease of $1,636 from the same period in 2023.
Additionally, due to the new regulations on tax credits for electric vehicles enacted by the U.S. government earlier this month, the retail sales share of electric vehicles in January is expected to decline from 9.2% at the end of 2023 to 8.1%. According to a previous report by Bloomberg, data from the U.S. fueleconomy.gov website shows that as of January 1st of this year, the stricter standards have reduced the number of electric vehicle models eligible for tax credits from approximately 24 to 13.
Thomas King, President of the Data and Analytics Division at J.D. Power, stated, "As of January 1, many electric vehicles no longer qualify for U.S. government incentives, so many consumers opted to purchase electric vehicles in December of last year."
