The automotive industry is undergoing a period of rapid transformation, driven by technological advancements, shifting consumer preferences, and ongoing supply chain disruptions. As we move into 2025, dealerships across the United States are navigating new challenges and opportunities that will shape the future of vehicle sales and customer experience. From the rise of electric vehicles to the growing demand for used cars, staying informed about the latest trends is essential for dealerships looking to stay ahead of the curve. In this blog, we’ll explore five key automotive trends that are reshaping the industry and offer insights on how dealerships can adapt to thrive in this evolving landscape.
The integration of big data, artificial intelligence, and real-time analytics is revolutionizing how dealerships approach problem-solving and strategic planning. Importance of efficient decision-making in car dealership environments, where the speed and accuracy of decisions can significantly impact a company's competitive edge, businesses must be agile and responsive, leveraging data-driven insights to make informed choices quickly.
Although used-car sales were down slightly in 2023 (35.9 million) from 2022 (36.2 million), the year ended with used-car sales surpassing the initial forecast. Looking into 2024, predictions are set for around 36.2 million overall used-car sales, which is an increase in sales from 2023, despite lingering supply challenges.
When it comes to vehicles, many people tend to have a strong loyalty towards the segment or type of vehicle they are driving and buying, rather than the brand itself. This loyalty stems from various factors, including personal preference, lifestyle, and even cultural influences. For example, some individuals may be die-hard fans of SUVs, appreciating their spaciousness, versatility, and ruggedness, regardless of the brand. Others may have a deep admiration for sports cars, appreciating the thrill and adrenaline rush that comes with owning and driving such vehicles. And then there are those who simply prefer the practicality and fuel efficiency of sedans or the convenience of owning a compact car.
As we approach mid-year 2023, the growth of electric vehicles (EVs) continues to be a hot topic in the automotive industry. Prices of EVs are beginning to decrease, becoming more in line with the cost of traditional gas-powered vehicles. As technology continues to improve and production costs decrease, we can expect to see more affordable EVs in the future. This is already taking shape as we see many OEMs increasing their EV market share since January.
In general, the used car industry has been experiencing a period of growth and change over the past several years. Some of the key trends that have taken place recently in the industry include shortage of inventory, rising prices, and growth of electric vehicles. Even with these obstacles, used vehicle sales have continued to thrive.
Electric vehicles continue to emerge as the way of the future. Learn how California incentivizes residents to purchase electric cars through the California Clean Vehicle Rebate Project.
The auto sales industry is not new to disruptions and rapid shifts. The past five years alone saw major economic fluctuations, the birth of ride share apps, and the growth of online automotive sales. Still, the dealership model remained strong.
Then the COVID-19 pandemic hit. Overnight, traffic dropped over 70% in major cities and worldwide manufacturing ground to a halt.
In Part 1 of this blog series, we spoke about the used vehicle market and the evolution of Carvana in the overall market. In this series, we'll share an inside look at the used vehicle sales data from big states with a heavy Carvana presence and how the dealerships within those states are stacking up.