Last year was not a great year for automakers. Production halted and sales plummeted. And although the pandemic continues to rage amid vaccines rolling out, a new forecast shows brighter days in 2021 for carmakers. TrueCar released its 2021 forecast on Thursday and the firm’s analysts believe we’ll see 16 million cars sold this year.
The figure includes both retail and fleet sales for the total number, and it marks a substantial uptick from 2020 numbers. Last year, new cars sales dropped significantly, with a total of 14.6 million cars sold. To put that into perspective, it was the worst year for carmakers since 2012, when Americans scooped up 14.4 million new cars in the shadows of the Great Recession. Throughout the rest of the 2010s, auto sales increased year-over-year before plateauing in 2016 and hovering around 17 million cars sold.
The 2021 forecast’s estimate showing a 10% increase of 2020 would be a welcome return to normal for automakers, though still down from 2019 — the last year before we can factor COVID-19’s effects into sales figures. That year, the industry sold 16.9 million cars.
Projecting confidence in a K-shaped recovery, which means various sectors and groups of people won’t uniformly recover from a recession, TrueCar said higher-income households will be the driving force when it comes to new car sales this year. This type of recovery will also likely continue to push average new car prices higher. We saw this last year which prices averaging over $40,000 in the fourth quarter of 2020 for the first time — a hauntingly high price for those looking for a new vehicle. However, for 2021, TrueCar projects an average price of $37,925, slightly down from last quarter’s data.
As people push for more SUVs and trucks, this will likely continue to fuel the trend of higher new vehicle prices for the foreseeable future. However, the firm also said to not discount electric cars, either. Their higher prices may also start to push average prices higher as more automaker introduce EVs.