Longevity on the Roads: A Glimpse into the Aging Vehicle Fleet in the United States

With over 284 million vehicles currently operating on U.S. roads, the average age of cars and light trucks in the country has reached a new record of 12.5 years, according to an analysis by S&P Global Mobility. This marks an increase of more than three months compared to 2022.

Impact of Constrained New-Vehicle Sales

S&P Global Mobility's predictions from last year have been realized, as constrained new-vehicle sales continue to impact the average age of the vehicle fleet. The growth in average age is in line with their projections, reflecting the ongoing impact of limited new-vehicle availability.

Shift in Vehicle Composition

The rise in light trucks and utility vehicles has contributed to a decline in the number of passenger cars on the road, falling below 100 million for the first time since 1978. This shift in vehicle composition has implications for the overall dynamics of the U.S. vehicle fleet.

Longest Streak of Increase in Vehicle Age

This year's increase in the average age of vehicles marks the sixth consecutive year of growth. It is also the largest yearly increase since the 2008-2009 recession when new-vehicle sales significantly declined, causing a faster acceleration in the average age.

Factors Influencing Average Age Growth

Supply constraints leading to low new vehicle inventory and reduced consumer demand due to interest rates and inflation played significant roles in driving up the average vehicle age in 2022. Retail and fleet sales of new light vehicles dropped by 8% compared to the previous year.

Outlook for New Vehicle Sales and Average Age

S&P Global Mobility forecasts project that new vehicle sales will surpass 14.5 million units in 2023, which is expected to moderate the rate of average age growth. The pressure on the average age is anticipated to ease in 2023, with a return to historical norms for new vehicle sales projected in 2024.

Implications for Vehicle Service Industry

The increasing average age of light vehicles presents growth opportunities for the vehicle service industry. Older vehicles require more repair work and service, benefiting the aftermarket sector. S&P Global Channel Forecast estimates significant revenue growth for the U.S. light-duty aftermarket in 2022, with further potential increases projected for 2023.