The shock of high gas prices has not dampened U.S. vehicle sales — yet.
While vehicle buying so far this year has been slower compared to an unexpectedly good start to 2025, industry analysts say it will take months of high fuel prices before U.S. consumers ditch popular pickups and SUVs and begin buying smaller, more fuel-efficient or electrified models.
“Seeing the gas price uptick, that definitely changes their opinion or consideration if they’re in the market,” said Stephanie Valdez Streaty, director of insights at Cox Automotive. “But I don’t think it immediately will change their buying behavior.”
Fuel prices began shooting up in mid-March after the start of the U.S. war with Iran. After hovering around $3 and $3.50 per gallon for most of the past three years, average gas prices went above $4 per gallon at the end of March, according to AAA.
Deutsche Bank researchers in a March sales preview said while a hit to overall vehicle sales is not expected, expensive fuel “could present some headwinds to the (internal combustion engine) mix narrative.”
“A lot’s going to depend on what happens with fuel prices over the next several months,” said auto analyst Sam Abuelsamid, Telemetry vice president of market research and insights. “If fuel prices stay up (and) conflict in the Middle East continues, you will start seeing more consumers start buying EVs again.”
But heightened interest in battery-electric vehicles and fuel-efficient hybrids could fade quickly if the Strait of Hormuz reopens or President Donald Trump pulls the United States out of the fight altogether, Cox Automotive executive analyst Erin Keating said in a presentation last week.
“If tensions deescalate tomorrow and gas stabilizes at, say, $2.80, the urgency to switch powertrains fades quickly,” Keating said. “This isn’t a permanent shift in consumer preference yet. It’s a conditional response to conditions that may or may not persist.”
Valdez Streaty said the most immediate impact of high gas prices will be on how much people drive, meaning fewer road trips and errand runs. Still, concern among shoppers is beginning to show.
Views of new EV listings on CarGurus jumped $25% in March, according to the online marketplace. The share of new hybrid views also went up 11%.
“Gas prices are climbing, and shoppers are responding by shifting more attention toward electrified options,” CarGurus’ market intelligence Director Kevin Roberts said in a statement. “With the national average at $4 per gallon and several Western states already above that, interest in EVs and hybrids is gaining momentum.”
Jeff Laethem, president of Ray Laethem Buick GMC in Detroit, said he’s recently seen an uptick in EV purchases from customers as well as other dealers in states including California and Illinois.
“It’s not an ‘oh my gosh’ kind of thing,” he said, though Laethem said he’s not too worried that higher gas prices will affect consumers’ taste for pickups and large SUVs. “I don’t know if I’m concerned about gas prices. I would just be in general with how it affects the economy. It wasn’t that long ago when things were a lot cheaper, and lunch wasn’t $18 for one person.”
The overall sales picture — for EVs and otherwise — is varied across the country.
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Jim Walen, who owns and operates Stellantis NV and Hyundai Motor Corp. dealerships in Seattle, Washington, said he had good sales for both product lines in March after slow post-holiday sales in January and December.
Walen said it was hard to pin down one dominant trend among shoppers at his stores since the Iran war began. “The buying public is fragmented,” he said, noting splits along political lines.
“There’s a core people, maybe 25% of the buyers, that believe everything Trump says — that this thing’s going to be over very quick, gas prices are going to be down, inflation is going to be tamed,” he said. Walen said those more politically conservative consumers have been undeterred by the war.
“Everybody else, they’re more focused on electric vehicles. They’re looking at hybrids. It is absolutely top of mind,” Walen added, though he mentioned that the tech and artificial intelligence-driven economy of his area might make it an “outlier” compared to the rest of the country.
Gas-powered SUVs and pickups remain top sellers in the United States.
The light-duty Chevrolet Silverado pickup remains GM’s bestseller, with more than 84,000 sold between January and March, a roughly 8% increase compared to the same time last year. GM’s other big performers in the first three months of the year, according to sales numbers released Wednesday, were the light-duty GMC Sierra truck, as well as the Chevy Trax and gas-powered crossover SUV Equinox, which are among GM’s least expensive offerings with starting prices at less than $30,000.
Laethem said Buick Envistas and GMC Terrains are turning quickly at his Detroit dealership, and he’s buying all of the four-cylinder turbomax Sierra trucks he can get because incentives are making it the least expensive vehicle to lease.
“It’s got good fuel mileage for a big pickup,” Laethem noted.
Ram pickup sales increased 25% compared to the same time last year, and the 1500 had its best first quarter since 2023. Stellantis heavy-duty trucks grew by 21% for their best first quarter since 2022. The Jeep Grand Cherokee SUV’s sales grew by 10%, and Wrangler’s were up 17% for its best first quarter since 2022. Grand Wagoneer’s overall sales exploded 110%.
Ford Motor Co. is set to report its first-quarter sales results Thursday.
Jim Seavitt, owner of Village Ford in Dearborn, described his March as “slower than usual” but roughly even with sales from March last year. He said that surging gas prices, so far, have not boosted his sales of electrified Ford models.
“I’ve sold one Mach E in the last two months. It’s like it dried up,” he said, pointing to the end of a federal EV tax credit last September. “Trump, with his kind of trashing the EPA and all those rules, it’s back to gasoline again. So no hybrid — EVs especially, right now, are not selling at all, at least in my store.”
He added: “My wife said to me, ‘I don’t get it, Jim, you’re not selling more electric vehicles? I mean, gas is $5-something a gallon. What’s wrong with people?’ I said to her, ‘Nancy, just understand that infrastructure is still not there.”
“Even if you go to upscale communities like Birmingham,” he added, “there’s not one charger I can find. None of the parking lots and none of the businesses have a charger.”
