America might have reached "peak truck"
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Sales of pickup trucks and SUVs might have peaked in the United States — not because Americans don't want them, but because many people can no longer afford them.
Why it matters: Affordability is a growing concern, not just for car buyers, but also for stressed-out automakers facing heightened economic uncertainty and potential supply chain disruptions since President Trump took office.
The big picture: Big, fancy trucks and SUVs are the profit engines for automakers, generating cash to funnel into new technologies like electric, automated and connected vehicles.
- A market shift back to more affordable sedans would squeeze profits and hit General Motors, Ford and Jeep parent Stellantis the hardest because the American car is essentially obsolete.
- U.S. automakers gave up on the segment years ago, ceding it to the likes of Toyota and Honda, while they refocused on higher-margin models and advanced technologies.
Driving the news: A recent market outlook report from Dave Cantin Group and Kaiser Associates, specialists in dealership mergers, caused a stir by declaring "Peak Truck" as a trend to watch in 2025.
- Their latest survey of consumer sentiment showed the number of people who believe their next vehicle will be a truck or SUV fell 3% compared to a year ago, while the number intending to buy a car rose 3%.
- A surge in inflation last month, and continued high interest rates, added to the mounting evidence that car buyers are feeling pinched.
- Pickup truck sales are also closely tied to housing. When housing is slow, tradespeople don't replace their vehicles as quickly.
- "This isn't just an automotive story, it's an American consumer story," said Dave Cantin.
Reality check: America hasn't given up its love affair with trucks and SUVs.
- But sales data shows some buyers are trading down to smaller, less-expensive models, says Erin Keating, executive analyst at Cox Automotive.
- One example: Full-size pickup sales have softened, but cheaper mid-size trucks like the Ford Ranger and Maverick are in high demand.
- Also popular: Compact and subcompact SUVs like the Toyota RAV4 and Chevrolet Trax.
By the numbers: Even trading down, truck prices still far exceed other options.
- The average price of a new truck in January was $59,684, while SUVs sold for an average of $47,667, according to Cox Automotive.
- Cars, meanwhile, sold for an average of $39,233.
Between the lines: More than the sticker price, however, buyers care about their monthly outlay for a car.
- Larger down payments and leasing are ways to lower monthly payments — currently an average of $755, per Cox.
- But other car-related expenses add up, too. Maintenance costs rose 44% between December 2018 and December 2024, while insurance was up 52% and gasoline was 30% higher in that time frame, according to federal data.
What to watch: The auto industry is forecasting a solid year, but executives concede they haven't factored in higher tariffs or policy flip-flops on electric vehicles under the Trump administration.
- For now, manufacturers are adopting a wait-and-see attitude, but the uncertainty makes strategic planning difficult, Brian Gordon, chief business and strategy officer at DCG, tells Axios.
- "It's a story in progress."
Disclosure: Cox Automotive and Axios are both owned by Cox Enterprises.
