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Brisk New-Vehicle Sales Open Year

Forecast predicts consumer spending will hit a record for January.

January 23, 2025
Brisk New-Vehicle Sales Open Year

The forecast estimates January retailer profit per unit will be down about 14% year-over-year.

Credit:

Pexels/Obi Onyeador

1 min to read


January new-vehicle sales are forecast to be up 5% over a year ago, though dealer profits are down.

The J.D. Power forecast estimates retail sales will hit just over 904,000 units this month, which has the same number of selling days than last January. 

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It’s observing robust business for a seasonally adjusted annual rate of 15.6 million for retail and nonretail combined, up 600,000 units from a year ago.

Sales are strong enough, in fact, that J.D. Power forecasters say consumers are spending more on new cars than in any January in recorded history: about $38.5 billion for retail and nonretail combined.

It attributes the result to brisk sales combined with still-elevated vehicle prices, regardless of generous incentives by both automakers and dealers. The forecast puts January’s average transaction price at $44,636, about flat year-over-year.

Dealers, though, aren’t reaping as many benefits. J.D. Power estimates retailer profit per unit, including finance-and-insurance sales, will total $2,272, down about 14% year-over-year. It blames replenishing inventory and a resulting eight percentage point decline in units selling above manufacturer suggested retail price.

Industrywide, total retailer profits from new-vehicle sales in January are down 8% year-over-year to $2 billion, according to the forecast.

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