TrueCar, Inc. projects 16 million new light vehicle sales for 2021, an increase of 10% from the previous year.
Retail sales are expected to reach 13.9 million, an increase of 9.6% from 2020.
"The year 2020 was a challenging one for the automotive industry and the economy at large, but the recovery came faster than most expected, providing strong momentum and pent-up demand going into 2021," said Nick Woolard, lead industry analyst at TrueCar. "Retail demand is healthy and will remain the driving force for total vehicle sales in 2021. Fleet sales will also increase, but at a much slower pace, due to the uncertainty surrounding travel."
Q4 2020 saw record-breaking average transaction prices for new vehicles, as incentives eased and consumers opted for more expensive SUVs and trucks.
The trend towards more expensive vehicles continues in 2021. Average transaction prices are projected to increase 3.1% year over year to $37,925. In previous years, the average transaction increased roughly 4% year over year.
"As the K-shaped recovery takes shape in 2021, we expect higher-income households, who have not been financially impacted by the pandemic, to continue making new vehicle purchases," added Woolard. "Continued trends towards large trucks, SUVs and a growing array of electric vehicles as well as additional safety and technology content will lead to even higher average transaction prices in 2021."
Average interest rates for new vehicles in 2020 were 4.74%, and interest rates for used vehicles were...