Against the backdrop of economic headwinds such as tariffs and inflation, American consumers persevered to create strong third-quarter automobile sales, with the giant automobile makers recording very high profits in various categories. Car sales of electric vehicles depicted high sales as consumers jumped to claim the federal tax credits before they expired in September 2021, whereas the large SUVs ruled conventional categories.
Electric car drives record-breaking quarterly figures
The coming end of the purchase of the federal EV tax credit of up to $7,500 caused an immediate buying spurt, which drastically increased the sales of electric vehicles to a third-quarter record. Ford had a sales increase of 30.2 percent to exceed 30,600 EV units, with General Motors and Hyundai outselling the Industry with more than a double increase in EV sales in that period.
Cox Automotive estimates the sale of EVs of up to 410,000 units in the third quarter, a 21 percent growth compared to the prior year and a market share of 10 percent, a record. This surge was the case with the Hyundai Ioniq 5, selling more in three months than in the first half of 2024, with sales increasing 90 percent year-over-year, and 21,999 units sold.
Car makers offer incentives to keep up the pace
Large car makers such as GM and Ford initiated initiatives to basically open up the $7,500 tax credit on EV leases, and their financing departments have been putting down payments on dealer stock to keep sales flowing once the federal subsidies run out. Overall, both General Motors and Ford showed successful outcomes in terms of sales growth (8 percent), proving that despite difficult economic circumstances, the consumer demand remains strong.
The big SUV market shows outstanding performance
The popularity of high-capacity SUVs among American consumers propelled tremendous success by various car makers, and the new models have been at the forefront. The updated Expedition at Ford had increased its total units sold by 48 percent to 21,844 vehicles, and the Explorer by 33 percent to 56,000 vehicles after the respective model year changes in 2025.
The newly redesigned SUV range by Chevrolet had also done exceptionally well, as the gas-powered Equinox increased by 99 percent to 73,694 cars and the Traverse by 37 percent to 38,853 cars. Sales increased 10 percent and 39 percent, respectively, in even full-size models such as the Tahoe and Suburban, which have been revised in the current model year.
The record sales achieved by Hyundai in Q3 were made on the basis of both electric vehicles and large SUVs, with the sales of the Santa Fe increasing by 37 percent and Palisade by 27 percent.
Market winners and losers are created due to import problems
As a domestic and even foreign automaker rejoiced, tariff effects were felt in some areas. The imported models of Buick met with great difficulties as the Encore GX, built in Korea, lost 38 percent, and Envision, built in China, lost 35 percent of its sales, presumably because of 25 percent tariffs on both Korean and Chinese imports.
On the other hand, locally made cars, such as the Buick Enclave made in Michigan, sold well since sales increased 60 percent, with the consumer possibly favoring cars that were not subject to tariffs. Chevrolet Corvette was also a significant variation to the favorable developments, as the sales dropped by 34 percent to 5,123 cars, as customers continue to wait for the re-modeled 2026 car.
Strong sales in the auto markets in the third quarter show the strength of American consumers to overcome the economic difficulties, and a rational choice regarding the incentives on EVs and the persistence of purchases of large SUVs contribute to the growth of the market. Although some of the imported models were headed in the wrong direction due to the existence of tariffs, the domestic production experienced the impact of the changing consumer preferences.