Auto Market Weekly Summary

Key Highlights

• New-vehicle sales are expected to rebound in February, with a seasonally adjusted annual rate (SAAR) of 16.3 million, up from last year’s 15.7 million.
• Residential construction trends were mixed in January, with steady permits but a decline in starts due to winter weather disruptions.
• Consumer sentiment deteriorated further in February, with significant declines in views of current conditions and future expectations.

New-Vehicle Sales Forecast

Cox Automotive forecasts a modest rebound in February’s new-vehicle sales, with a SAAR of 16.3 million, an improvement from last year’s 15.7 million and January’s 15.6 million pace. [Check back to the Newsroom for the forecast release later today.]

• New-vehicle sales volume is expected to decline slightly from last year, but the sales pace is stronger when adjusted for one fewer selling day in February.
• January sales fell significantly from December due to cold weather, California fires, and the inauguration, but buyers are likely to return in February, lifting the sales pace.
• Cox Automotive predicts light new-vehicle sales to continue improving modestly in 2025, reaching 16.3 million by year-end, up from just over 16.0 million units in 2024.

Residential Construction Trends

Residential construction trends were mixed in January as permits were steady and starts declined because of winter weather disruptions. The underlying data suggest some growth is likely in multifamily, but with mortgage rates back up, limited demand for single-family could keep starts and permits from growing.

• The seasonally adjusted annualized rate of starts declined by 9.8%, while permits increased by 0.1%.
• Multifamily starts declined 13.5%, and single-family starts fell 8.4%.
• Permits lead starts, indicating that starts should increase in future months, with more rental units needed to contain shelter inflation.

Existing Home Sales

Existing home sales declined in January for the first monthly decline in four months. Inventory increased, but overall supply remains tight, and prices were up 4.8% year over year.

• The existing home sales SAAR of 4.08 million was up 2% from a year ago but at the lowest level since September.
• Sales were down in every region except the Midwest, with the West experiencing the largest decline at 7.4%.
• Inventory increased by 3.5% to 1.18 million units, with months’ supply of homes for sale rising to 3.5 months.

Jobless Claims

Jobless claims are down from peaks caused by hurricanes in the fall and wildfires in January.

• Seasonally adjusted initial jobless claims increased by 5,000 to 219,000 for the week ending February 15.
• Continuing claims increased by 24,000 to 1.87 million, while the broadest measure of continuing claims declined by 63,300 to 2.22 million.

Consumer Sentiment

Measures of consumer sentiment showed further deterioration in February.

• The University of Michigan’s Consumer Sentiment Index declined 9% to 64.7, the lowest level since November 2023.
• Expectations for inflation in one year increased to 4.3% and in five years to 3.5%.
• Views of buying conditions for vehicles declined to the lowest level since August, with deteriorating views of prices but steady views of interest rates.

Jonathan Smoke

Chief Economist

Jonathan Smoke leads Cox Automotive’s economic and industry insights team, which tracks key metrics and trends impacting both the wholesale and retail markets for vehicles informed by the proprietary data from the company’s businesses and platforms. For 28 years, Smoke has focused on translating data and trends into relevant actionable insights for the industries that represent the biggest purchases that consumers make in their lifetimes: real estate and automotive. Smoke joined Cox Automotive in 2017.