100,140 108,589 116,400 112,900 2023 Actual 2024 Actual 2025 Forecast 2026 Forecast Third Quarter 2025 Released October 2025 Market Summary Forecast for State New Retail Light Vehicle Registrations UP 7.6% vs. ‘22 UP 8.4% vs. ‘23 UP 7.2% vs. ‘24 DOWN 3.0% vs. ‘25 Arkansas Auto Outlook Coverage of the Arkansas new vehicle market TM YTD '24 YTD '25 % Chg. Mkt. Share thru Sept. thru Sept. '24 to '25 YTD '25 TOTAL 80,373 89,421 11.3% Car 11,614 10,541 -9.2% 11.8% Light Truck 68,759 78,880 14.7% 88.2% Domestic 38,864 46,127 18.7% 51.6% European 4,283 4,250 -0.8% 4.8% Japanese 27,347 27,223 -0.5% 30.4% Other Asian 9,879 11,821 19.7% 13.2% Domestics consist of vehicles sold by GM, Ford, Stellantis (excluding Alfa Romeo and FIAT), Tesla, Rivian, and Lucid. Other Asian includes Genesis, Hyundai, Kia, and VinFast. Data sourced from Experian Automotive. The graph above shows annual new retail light vehicle registrations in 2023 and 2024, and Auto Outlook’s projections for 2025 and 2026. Historical data sourced from Experian Automotive. FORECAST Arkansas Market Out-Performs U.S. During First Nine Months of ‘25 Year-to-date results in state market State new retail light vehicle registrations increased 11.3% during the first nine months of this year versus a year earlier, well above the 6.1% improvement in the nation. Third quarter registrations declined slightly compared to 3Q ‘24, but still surpassed expectations. (See below for more details). Factors steering the new vehicle market At the start of this year, the outlook was relatively straightforward. Vehicle affordability was an obstacle hindering sales, while pent-up demand was a positive offset. The consensus forecast was for slow growth in new vehicle sales. However, a wildcard emerged when tariffs were imposed and the rules governing global trade policy underwent a complete overhaul. This magnitude of change lacks historical precedence and introduced several key unknowns. How quickly would manufacturers increase vehicle prices due to tariffs? How much pull-ahead demand would occur by shoppers trying to buy in advance of these anticipated price increases? How long would it take for the inflationary impacts of tariffs to circulate through the economy? And what would actual tariff rates end up being? Higher tariffs will eventually pull sales lower, but pinpointing the timing has been elusive due to the uncertainty in being able to answer these questions. Up until now, manufacturers have largely avoided price increases and many shoppers have entered the market prematurely in the expectation of higher prices in the future, contributing to stronger than expected results. But higher tariffs will eventually be a headwind for new vehicle sales. Forecast for rest of this year and 2026 New retail light vehicle registrations in the fourth quarter of this year are predicted to decline 4.4% versus the year earlier. The market is expected to increase by 7.2% for the entire year. At this point, it looks like new vehicle sales are likely to decline in 2026. More details on next year’s outlook in the 1Q ‘26 release. Tracking alternative powertrain sales The September 30, 2025 expiration of federal government BEV incentives only gave a mild boost to electric vehicle sales in the third quarter of this year. Combined BEV/PHEV share increased to 2.8% in 3Q ‘25, up from 2.5% in 2Q. BEV share will almost certainly move lower at the end of this year. Hybrid vehicle sales continue to post gains, with registrations increasing 41% during the first nine months of this year versus the year earlier. Monitoring brand sales performance State new vehicle registrations for Lincoln, Buick, Cadillac, Ford, Jeep, Hyundai, Lexus, and GMC increased by more than 20% so far this year versus year earlier. Lincoln, Buick, and Tesla fared better in the state than in the Nation (see page 4). Registrations increased by more than 54% for ten brands over the past five years: Tesla, Genesis, Lexus, Volkswagen, Cadillac, Buick, Hyundai, Kia, Mazda, and Lincoln. SCAN THE QR CODE TO GET THE FULL REPORT. https://arkansas-auto-dealer.thenewslinkgroup.org/ arkansas-auto-outlook-2025-issue-3/
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