Ten years ago, 17.6 million cars, trucks and SUVs were sold in the US. Some forecasts say the country may never come close to that number again.
Analysts at the communications firm Bain & Company said that many signs indicate that the market is about to decline significantly. Declining birth rates, changes in behavior, higher car prices and a host of other factors could reduce sales by more than two million units by 2040, according to their analysis.
These indicators point to a future where automakers are competing more for a shrinking number of customers, said Mark Gottfredson, a partner at Bain & Company.
The auto industry has historically relied on a 1% annual growth rate that tracks overall population growth, Gottfredson said. But around the world, government statistics show population growth has slowed, and some countries are already seeing declines.
“It’s quite a storm, isn’t it,” Gottfredson said. “It starts with population decline. You’re no longer a growth industry. You’re a shrinking industry. You’re a declining industry at a time when technology is disrupting everything.”
America’s fertility rate in 2025 was about 1.6 births per woman. Although it is not as low as some countries in Europe or Asia, it is considered below the replacement rate of 2.1, according to the Centers for Disease Control.
Bain said that was offset by mass immigration — about a million people coming to the US, according to the historical average he cited. But the company said it expects restrictive immigration policies to last for the next 15 years, halving the net migration rate of the past 20 years, meaning it could return to the low levels seen in 2019.
That behavior of the rest of the population has changed – in part because of higher prices and more affordable alternatives, according to Bain. Half of 16-year-olds today do not have a driver’s license, compared to about 70% of 16-year-olds between 1966 and 1984, Gottfredson said. The figure may reflect a delay rather than an outright rejection – Bain’s research suggests that many people are still getting licenses at 25 years.
Still, the share of new car registrations among 18- to 34-year-olds has fallen from 12% in the first half of 2021 to less than 10% by mid-2025, according to S&P Global Mobility. Consumers age 55 and older account for nearly half of all new enrollees and have had the largest share for eight straight quarters, the company said.
“The engine behind it is affordability,” said Craig Daitch, founder and president of Telemetry, an automotive market research firm. Monthly payments for new cars have risen 30% in four years, and about one in five cars now has a payment of more than $1,000 a month, he added.
AutoForecast Solutions, a forecasting firm, expects new US vehicle sales to remain flat at about 16 million through 2033, the farthest year in the future when the company releases its estimates.
“If you look at the future, young people are more likely to use Uber or Lyft to go somewhere,” said Sam Fiorani, vice president of global car forecasting for the company. “We still see groups of young people who love to drive and want a new car, but few can afford it.”
If robots become widely available and affordable in the next 15 years, the share of licensed people could drop by about 2 to 3 percent, to 85%, according to Bain research. The number of cars per driver could drop from 1.2 to 1.1, which would equate to 10% to 20% of US households owning one car.
The guesses Gottfredson shared with CNBC are updates. He had previously targeted 2030 as the year when prices would drop below 14 million, but said he has changed those views because autonomous vehicles are taking longer than expected to arrive.
The numbers of people, however, are baked.
“We already know how many people are born and how many people will be 16 years old driving cars 16 years from now. And so we can say with certainty that when we get to 2040, we’re going to see some decline in the U.S. That decline is even worse in places like Europe and places like many Asian countries.”
Gottfredson said the most direct indicator of future declines is the rate at which vehicles are “deregistered,” that is, they are taken off the road and scrapped or sent to another market, as happens with used cars.
In 2000, the deregistration rate was about 6%, according to a Bain report. As of 2025, the rate was about 5%. Gottfredson said the rate could drop to 4.4% by 2040. That’s because cars are living longer — hitting a record 12.8 years on the road by 2025, according to S&P Global Mobility.
This can backfire. The lifespan of electric vehicle batteries is uncertain. It’s also unclear how long automakers will be willing or able to update critical software for new cars.
However, car experts say that since the prices of cars are high, the industry will have to find a way to keep the cars in condition.
“Today’s cars can’t have a limit of five to ten years,” Fiorani said. “It doesn’t work for someone who spends $50,000 or $100,000 that he’s going to be a waste in less than ten years.”
If these trends continue, the US auto industry is bound to become even more competitive. Buyers have their choice of about 450 nameplates already in the country.
“The competition in the US is going to be fierce,” Gottfredson said. “There are too many car manufacturers and too many brands competing for consumers. The market will have to consolidate.”
