Americans Love Buying Cars Even With Uncertainty (Or Because Of It?)

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Issue #155

Q3 is over, and sales figures are out. There are some clear winners and losers, with one brand leading the way.

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Market News

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Safety and Recalls

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Car Culture

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Video Of The Week

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In The Know

What Uncertainty? Car Sales Are Still Going Strong

Subtitle: Surprising Q3 results showcase how the American buyer still loves having cars—especially one type in particular. But there's a catch.

As Q3 closes, the industry's fears of collapsing sales seem overblown. Just months ago, analysts warned that tariffs would crush demand, with higher car prices scaring off buyers.

We even echoed that prediction—mea culpa. It wasn't only us, this article also stated the same.

After all, new cars were already pricey, and tariffs made them even more expensive. The logical outcome was stagnation, as even Cox Automotive predicted in this article.

Instead, reality turned out stranger than fiction. Q3 sales didn't shrink—they grew. According to Cox Automotive, new vehicle sales are expected to hit 4.14 million, up from 3.9 million in Q3 2024. Tariffs may have raised costs, but buyers still showed up. You can read more about this here.

One reason? EVs. Sales hit record highs, driven by urgency. This article explains how, as federal tax credits expired at the end of September, buyers rushed to snag electric cars before prices jumped. Leasing, especially Teslas, is already becoming more expensive, as you can read here.

The biggest winner wasn't Tesla, though. Hyundai's Ioniq 5 saw a staggering 90% sales increase in Q3, cementing the Korean automaker as a serious EV player, for now. By looking at this photograph, sales are looking great, but buyers might lack the motivation to go for an EV after rebates are over.

However, Hyundai doesn't have to worry. It also thrived with gasoline-powered SUVs like the Santa Fe and Palisade, proving buyers aren't ready to give up on traditional powertrains either. We had discussed traditional powertrains last week, so there's some validation there.

Redesigns were also a part of the secret sauce for legacy automakers. GM rode fresh looks and updated tech to strong sales: the Suburban climbed 40%, while both the Equinox EV and its gasoline counterpart posted big gains.

Even Ford, notorious lately for quality stumbles, surprised with a 48% surge in Expedition Tremor sales.

This article explains when it's a good move to buy an outgoing car versus a redesign.

Then, there's Stellantis. Can you believe it also joined the winners' circle? Jeep Wranglers and Grand Cherokees helped drive momentum, and this talks about a bigger trend: Americans still want SUVs, especially ones with size and performance.

This Car And Driver article explains winners and losers with great detail.

So where do tariffs fit in? Automakers have, so far, successfully passed some costs to buyers without killing demand. It's a balancing act, and one that won't last forever.

If Q3 shows anything, it's that consumers are willing to absorb higher prices when incentives or redesigns sweeten the deal.

But there's little doubt that eventually, affordability will become a heavier drag.

Looking to Q4, sales may dip slightly as the EV credit rush ends, but not drastically thanks to gasoline-powered cars, if automakers don't translate a lot of the costs. We can also bet that EV sales will lose a lot of ground.

For now, the lesson is clear: despite economic uncertainty, tariffs, and sky-high prices, Americans still want cars. More specifically, they want SUVs, crossovers, and EVs with some punch.

The market may look unpredictable on paper, but buyers continue to prove that car culture in the U.S. is stronger than ever.

Does this mean that soon we'll see another competitor to the F-150 and the Toyota Rav4 as America's favorite car?