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| US Auto |
Strong Recovery in Light Vehicle Sales Reflects Consumer Confidence
US auto sales rebounded sharply in July 2025, reaching a seasonally adjusted annual rate of 16.4 million units, the highest since April. This increase follows a June rate of 15.3 million units and exceeds July 2024’s 15.8 million units. The rebound reflects consumer urgency before tariff hikes on foreign cars and parts took full effect earlier this year, highlighting the market's sensitivity to trade policy shifts.
Light Truck Sales Lead Growth, Cars Also Show Gains
Light truck sales rose 8% to an annualized rate of 13.8 million units in July, while car sales increased by 2.6% to 2.6 million units. The combined surge underpins the overall strength of the US automotive sector despite ongoing tariff pressures. However, production data show a decline, with June’s output dropping to 10.57 million units annually, signaling supply-side adjustments lagging behind demand.
Employment Concerns Cloud Future Consumer Demand
Despite July’s sales rebound, recent employment reports indicate slowing job growth, the lowest in three months since the 2020 Covid slump. Therefore, consumer spending may weaken going forward, potentially softening demand for new vehicles. Automakers must navigate this uncertain environment amid evolving trade policies and supply constraints.
ScrapInsight Commentary
The July sales rebound suggests resilience in US automotive demand despite tariff headwinds. However, slowing employment growth may cap future consumption. This dynamic pressures scrap metal demand from the auto recycling sector, underscoring the interplay between economic health and raw material markets.
