October new-vehicle sales, when announced next week, are expected to take a step back from the strong pace seen in the third quarter, according to Cox Automotive estimates released Oct. 27.

The October sales pace, or seasonally adjusted annual rate (SAAR), is forecast to reach 15.7 million, down from last year’s 16.1 million level and down from September’s pace of 16.4 million. The October slowdown is expected to be driven in part by a decline in electric vehicle (EV) and plug-in hybrid vehicle (PHEV) sales.

Sales volume is projected to reach 1.3 million, a decrease of more than 3% from the previous year but an increase of 2.7% from last month. October has 27 selling days, the same as last year but three more than last month.

“The new-vehicle sales pace was surprisingly strong this summer despite ongoing tariff uncertainty,” said Charlie Chesbrough, senior economist at Cox Automotive, in a news release. “However, as more tariffed products replace non-tariffed inventory, prices are tracking higher, which should lead to slower sales through the remainder of the year. With the expiration of EV tax credits and a decline in alternative powertrain sales, the sales pace is anticipated to decrease as we move into a new season.”

Fourth Quarter and a New Era of Electric Vehicle Sales

Sales of EVs accelerated after passage of the Big Beautiful Bill in early July as buyers rushed to buy before the $7,500 tax credits expired at the end of September. As expected, EV sales volume in the U.S. hit an all-time high in Q3 2025, reaching 438,487 units sold, according to Kelley Blue Book estimates. 

EV sales volume in Q3 was up 40.7% from the previous quarter and higher by 29.6% year over year. Moving forward, the EV segment will be charting a new path without government-backed sales incentives.

“The EV sales story will really change going forward from here,” noted Chesbrough. “Sales of EVs and PHEVs are expected to collapse in October as tax credits expire. In addition, market conditions for other vehicles are expected to become more challenging in future months as prices increase.”

Cox Automotive Full-Year Forecast and Outlook

Cox Automotive’s full-year sales forecast range is 15.8-16.4 million, with a baseline of 16.1 million, the likely outcome for the year. Based on robust Q3 sales, forecasts for both fleet and new retail sales were raised during the last quarterly call. 

With an expected decline in EV leasing in Q4, the lease penetration forecast was lowered from 25% to 24%. Used retail sales and sales of certified pre-owned (CPO) vehicles were adjusted higher.