Ten years in the past, a file 17.6 million automobiles, vans and SUVs have been offered within the U.S. Some forecasts say the nation may not come near that quantity once more.
Analysts at consulting agency Bain & Firm mentioned a number of indicators point out the market is about to shrink much more. Falling beginning charges, behavioral modifications, excessive automobile costs and a rising array of alternate options might drive gross sales down by greater than 2 million items by 2040, based on their evaluation.
These indications level to a future the place automakers fiercely compete for a shrinking variety of prospects, mentioned Mark Gottfredson, a associate at Bain & Firm.
The auto trade has traditionally relied on an annual 1% development fee that tracks the rise of the general inhabitants, Gottfredson mentioned. However everywhere in the world, authorities statistics present inhabitants development has slowed, and a few international locations are already seeing declines.
“It’s the excellent storm, is not it,” Gottfredson mentioned. “It begins with the inhabitants declines. You are not a development trade. You are a declining trade. You are a declining trade at a time when the know-how is disrupting the whole lot.”
The U.S. fertility fee in 2025 was about 1.6 births per lady. Whereas not as little as some international locations in Europe or Asia, it is thought of under the substitute fee of two.1, based on the Facilities for Illness Management.
Bain mentioned that has been offset by comparatively excessive immigration — about 1,000,000 individuals coming to the U.S., based on the historic common it cited. However the agency mentioned it expects restrictive immigration insurance policies will final for the subsequent 15 years, chopping historic web migration charges of the previous 20 years in half, which suggests it might once more attain low ranges seen in 2019.
That remaining inhabitants’s habits has modified — partially resulting from excessive costs and reasonably priced alternate options, based on Bain. Half of 16-year-olds in the present day haven’t got a driver’s license, in contrast with almost 70% of 16-year-olds between the years of 1966 and 1984, Gottfredson mentioned. The stat would possibly replicate a mere delay fairly than a complete refusal — Bain’s analysis suggests most individuals nonetheless get licenses by age 25.
Nonetheless, the share of latest automobile registrations amongst individuals aged 18 to 34 fell from 12% within the first quarter of 2021 to underneath 10% by mid-2025, based on S&P World Mobility. Patrons 55 and older account for almost half of all new registrations and have held the biggest share for eight straight quarters, the agency mentioned.
“The engine behind it’s affordability,” mentioned Craig Daitch, founder and president of Telemetry, a agency that does market analysis for the auto trade. New automobile month-to-month funds are up 30% over 4 years, and almost one in 5 new automobiles now carries a fee over $1,000 a month, he added.
AutoForecast Options, a forecasting agency, expects U.S. new automobile gross sales to remain comparatively flat at round 16 million by way of 2033, the furthest 12 months sooner or later for which the corporate points estimates.
“If you look into the longer term, youthful persons are extra doubtless to make use of Uber or Lyft once they’re going someplace,” Sam Fiorani, vice chairman of worldwide automobile forecasting for the corporate. “We’re nonetheless seeing teams of younger individuals who get pleasure from driving and desire a new automobile, however fewer can afford it.”
If robotaxis change into broadly accessible and reasonably priced within the subsequent 15 years, the share of the licensed inhabitants might drop round 2 to three proportion factors, to 85%, based on Bain analysis. The variety of automobiles per driver might drop from 1.2 to 1.1, which might be equal to 10% to twenty% of U.S. households shedding one automobile.
The projections Gottfredson shared with CNBC are revisions. He had earlier focused 2030 because the 12 months when volumes would dip under 14 million, however mentioned he modified these assumptions as a result of autonomous automobiles are taking longer than anticipated to reach.
The inhabitants numbers although, are baked in.
“We already understand how many individuals have been born and the way many individuals can be of auto driving age at age 16 in 16 years from now. And so we are able to say with fairly a little bit of certainty that once we get to 2040, we’ll see we’ll see some decline within the U.S. That decline is even worse in locations like Europe and in locations like a lot of the international locations in Asia.”
Gottfredson mentioned probably the most direct indicator of a possible of a future decline is the speed at which automobiles are “deregistered,” which is once they’re taken off the street and both scrapped or exported to a different market, as occurs with used automobiles.
In 2000, the speed of deregistration was about 6%, based on the Bain report. As of 2025, the speed was about 5%. Gottfredson mentioned that fee might fall to 4.4% by 2040. That is primarily as a result of automobiles are lasting longer — hitting a file 12.8 years on the street in 2025, based on S&P World Mobility.
This might reverse. The longevity of electrical automobile batteries continues to be unsure. It is usually unclear how lengthy automakers can be prepared or in a position to replace the software program that’s more and more very important to new automobiles.
Nevertheless, auto forecasters say that with automobile costs as excessive as they’re, the trade should discover a strategy to hold automobiles in service.
“Right now’s automobiles cannot have a limitation of 5 to 10 years,” Fiorani mentioned. “It isn’t sensible for an individual who’s spending $50,000 or $100,000 that it’ll be junk in lower than a decade.”
Ought to these traits maintain, the auto trade within the U.S. is liable to change into ever extra aggressive. Shoppers have their selection of about 450 nameplates within the nation already.
“The competitors within the U.S. goes to be ferocious,” Gottfredson mentioned. “There’s too many automakers and too many manufacturers competing for the shoppers. The market goes to need to consolidate.”
