EV Shift Gathers Speed: 1 In 4 Cars Sold In The U.S. By 2025 Will Be Electric

In a clear sign that the automotive industry’s electric vehicle (EV) transformation is gaining momentum, Cox Automotive forecasts that one in four vehicles sold in the United States (U.S.) during 2025 will be electrified.

According to Cox Automotive’s 2025 Outlook, pure EVs are expected to represent 10% of total new vehicle sales, up from 7.5% in 2024. Hybrid and plug-in hybrid vehicles will account for an additional 15% of sales, while traditional internal combustion engine (ICE) vehicles will see their market share decrease to 75% – the lowest level ever recorded.

This surge in electrified vehicle adoption comes as the broader automotive market shows a strong recovery from pandemic-era disruptions. New vehicle sales reached 16 million units in 2024, a 2% increase from the previous year, with Cox Automotive projecting further growth to 16.3 million units in 2025. Jonathan Smoke, Chief Economist at Cox Automotive, describes the current market as having “positive momentum,” supported by improving economic fundamentals and rising consumer confidence.

Several factors are driving the accelerated adoption of EVs. Around 15 new EV models are scheduled to enter the market in 2025, expanding consumer choice across various price points and vehicle categories. The ongoing expansion of charging infrastructure is also playing a crucial role in boosting consumer confidence in EVs.

Financial factors are similarly contributing to increased EV accessibility. Auto loan rates have recently declined, and approval rates are climbing, making EVs more attainable for many buyers. Some manufacturers have begun offering attractive lease deals, with recent promotions featuring monthly payments as low as $159 for select models.

Moreover, the used car market is also showing strength, with sales expected to reach 20.1 million units in 2025 – the highest level since 2021. This robust market provides additional pathways to EV ownership for price-conscious consumers.

Notably, the industry’s messaging around EVs has evolved from focusing primarily on environmental benefits to emphasizing practical advantages and driving experience. Features such as instant torque delivery and reduced maintenance requirements are increasingly resonating with mainstream consumers.

The market transformation arrives against a backdrop of broader industry success, with most major automakers posting higher year-over-year sales in 2024. General Motors (GM) maintained its position as the top-selling automaker, while Honda and Mazda revealed particularly strong growth.

Cox Automotive’s optimistic outlook is further supported by improving consumer sentiment, as interest rates have retreated from recent peaks and the job market has stabilized. The rapid expansion of charging infrastructure and various state-level incentives are expected to sustain growth even as federal EV tax credit policies face potential changes.

Furthermore, this projected 25% market share for electrified vehicles represents a significant shift in American car-buying preferences and suggests that EVs are moving beyond early adopters to become mainstream choices for everyday consumers.

Read More: EVs Are Charging Ahead: Global EV Sales Forecast For A 30% Jump In 2025

The forecasted 25% market share for electrified vehicles by 2025 underscores a significant transformation in American car-buying habits. EVs and hybrids are no longer niche options but are becoming mainstream choices for everyday consumers. With expanding model options, improving infrastructure, and growing financial incentives, the U.S. is well on its way to embracing an electrified future.

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