New light-vehicle sales in May reached a SAAR of 16.1 million units, an increase of 3.1% compared to May 2025. There were five weekends this May, including the Memorial Day weekend — typically a strong time for new-vehicle sales. Raw volume in May totaled 1.47 million units, an increase of 4.2% year over year and up 7.0% compared to April. Through May, the year-to-date SAAR is 15.7 million units, down 4.5% year over year. As in March and April, year-over-year sales comparisons in May are distorted by the significant pull-ahead volume last year as consumers moved up purchases to secure a vehicle before auto tariffs took effect. 

Conventional hybrids continue to be hot sellers, and the recent spike in fuel prices has only boosted their popularity. Year to date through May, hybrid vehicles were 15.2% of all new vehicles sold, an increase of 2.6 percentage points of market share compared to the same period last year. Hybrid sales volume is up 14.8% year over year. Meanwhile, battery electric vehicle (BEV) sales have fallen significantly, down 30.8% year over year through May. Overall, BEVs lost 2 percentage points of market share, falling to just 5.3% of new-vehicle sales so far this year.

According to JD Power, the average monthly payment on a new-vehicle finance contract in May likely will total $810, up 2.8% compared to May 2025. While average interest rates have declined by 47 basis points year over year to 6.59%, many consumers are turning to longer loan terms to keep payment inflation down. As JD Power notes, 13.4% of loans in May will be for 84 months or longer an increase of  0.8 percentage points year over year.

Fuel prices are well over $4 per gallon in many parts of the country, with no deal yet to reopen the Strait of Hormuz and resume prewar shipping flows. The longer the Strait is closed, the longer it will take for global oil and gas production to normalize and for prices to return to near pre-war levels. So far, global oil inventories have kept prices from rising higher. But those inventories are being rapidly depleted, so oil prices may spike again soon. Despite these challenges, we still forecast robust new light-vehicle sales of 16.0 million units for 2026.

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