Average age of vehicle fleet

The average age of the vehicle fleet is expected to climb in 2025, reaching 12.8 years, according to IBISWorld estimates. Several key factors underpin this trend. The surge in electric vehicle (EV) and autonomous vehicle adoption observed in the preceding year is losing momentum as these models become more widespread and less novel, contributing less to lowering the fleet's age. Simultaneously, consumer purchasing behavior remains impacted by a recent period of high inflation and elevated costs for big-ticket items, such as new vehicles. This environment has sustained the preference for maintaining older vehicles, prolonging the overall average age of the fleet as fewer new cars offset the aging pool of existing vehicles.

The average vehicle age has increased steadily from 2020 through 2025, shaped heavily by macroeconomic pressures and shifting consumer priorities. Coming into the period, the lingering effects of the COVID-19 pandemic were instrumental. In 2021, the average fleet age jumped 2.2% as high unemployment and uncertainty delayed new vehicle purchases. The economic rebound and consumer confidence in 2021 did not translate to immediate new vehicle sales because households redirected disposable income to essentials amid persistent economic volatility. Remote work became more prevalent, further reducing the demand for additional or replacement vehicles. The used car market remained robust, as many consumers sought affordable options or opted to retain older vehicles, a pattern reinforced by the continuation of pandemic-induced caution.

Rising inflation became the primary macroeconomic challenge in 2022 and 2023, keeping upward pressure on the average vehicle age. Elevated prices led consumers to prioritize savings, curbing new car purchases. Although IBISWorld reported a modest increase in new automobile sales in 2023, it was insufficient to counterbalance the large inventory of older vehicles retained by risk-averse consumers. The presence of a strong used car market compounded this effect, as affordability concerns and uncertainty about car prices drove increased demand for secondhand vehicles. The development and introduction of advanced vehicles, such as EVs and cars with autonomous features, offered some potential to rejuvenate the fleet, but cost considerations limited widespread turnover beyond an initial wave of adoption.

Macro trends such as vehicle longevity improvements and broader vehicle ownership prevalence also underpin this long-term rise in average age. The durability of modern vehicles has expanded, lessening the frequency of replacement. Additionally, while more households—particularly larger or multi-car families—now own multiple vehicles, this has not translated into higher new vehicle production, as a preference for used cars persists.

Over the five years to 2025, the average vehicle age increased 1.5%. The convergence of economic headwinds, elevated inflation, persistent consumer caution, the expansion of the used car market, and incremental vehicle longevity combined to push the average age steadily upward during this period.