New wheels for the well-off keep sales up

The auto industry is facing some big challenges.

- NEAL E. BOUDETTE

An Audi dealership in Miami. Wealthy consumers are keeping new car sales humming even as the auto industry battles tariffs, high interest rates and near-record prices.NYT

Tariffs have raised the prices of cars and auto parts. Economic strains have pushed up defaults on car loans to people with less than stellar credit.Yet sales of new cars in the United States are expected to have risen modestly in 2025, to about 16.3 million. Several large automakers, including General Motors and Toyota Motor, told investors Monday that they had closed out the year with strong sales.

How is that possible?

The auto industry has evaded a slump largely because affluent Americans with well-paying jobs and robust savings have continued to buy new cars at a decent clip. And they are more than making up for the cars that lower-income Americans are no longer buying.

Families with a household income of $150,000 (4.69 million baht) a year or more now buy 43% of the new cars sold in the country, up from one-third of all cars sold in 2019 before the Covid-19 pandemic, according to Cox Automotive, a research firm. By comparison, households with incomes less than $75,000 are buying about a quarter of vehicles sold, down from more than a third in 2019.