The ice is thinner in some respects under Cox Automotive’s relatively optimistic 2026 U.S. light-vehicle sales forecast, but for now it’s sticking to its prediction of 15.8 million units for the year, down 2.9% versus 16.3 million in 2025.
The key is that wealthy households continue to buy new vehicles, despite high prices for cars, gasoline and other goods, said Charlie Chesbrough, senior economist for Atlanta-based Cox Automotive.
However, consumer confidence is slipping, even in wealthy households, he said. And in past recessions, consumers who could afford it were willing to spend – until they weren’t, Chesbrough said in a June 18 webinar hosted by the Washington-based American International Automobile Dealers Association.
“This is really dangerous,” Chesbrough said in the call.
High gas prices are a particular worry, even if prices are down from recent peaks, he said. “Consumers see these high prices, and they start to conserve on their spending. … But they’ve still got to drive to work. It takes away from money they spend on other things. That’s what causes a recession, and that’s what we’re concerned about now,” Chesbrough said.
In a separate webinar hosted by Cox Automotive on June 24, Chief Economist Jeremy Robb said it's "welcome relief to consumers" that gas prices have begun to come down.
"With oil tankers now moving through the Middle East, we've likely seen the peak of inflation for the year related to the Middle East conflict. Inflation may start coming down -- however, it's likely to remain somewhat elevated for the next several months as those added energy costs are absorbed by producers and consumers alike," Robb said.
As of June 23, the national average price for regular gasoline was $3.93 per gallon, according to AAA data. That’s up 22% from $3.22 a year ago, but down 13.3% from $4.53 a month earlier.
Chesbrough said Cox Automotive isn’t predicting a recession. But with so much uncertainty about war, politics, prices and the economy, the concern remains. “We need confident people who are going to take out a $50,000 car loan,” he said in the June 18 webinar.
In May, the average new-vehicle transaction price was $49,220, according to Kelley Blue Book, a Cox Automotive company. That’s an increase of 1.2% versus a year earlier. Meanwhile, the average transaction price hit a record $50,326 in December 2025, KBB said.
True, there has been a gain in the share of auto loans to customers with subprime credit, compared with lows during the critical shortage of new-car inventory from 2020 to 2023. Automakers and dealers could afford to be choosy then, with long waiting lists for new cars.
Year to date in 2026, Chesbrough said the share of new-vehicle loans to consumers with subprime credit doubled versus two years ago, to around 20%, roughly where it was before the pandemic.
But those gains could be “vulnerable” in an economic downturn, he said. “To get real growth, we’ve got to get lower-income people out there buying these new vehicles,” Chesbrough said. “We are still on precarious ground.”
