According to a recent study by S&P Global Mobility, American consumers are keeping their internal combustion-engine (ICE) vehicles longer, resulting in a record average age of 12.5 years for U.S. cars and light trucks this year.
The trend is attributed to supply constraints on dealer inventories of new vehicles in 2022 and reduced consumer demand due to higher inflation and interest rates.
However, the study predicts that the average vehicle age will decrease in the coming year due to rising availability and renewed demand, with new vehicle sales expected to surpass 14.5 million in 2023.
Interestingly, electric vehicles are not following this trend. S&P reports that the average age of battery electric vehicles (BEV) in the U.S. is down from 3.7 years in 2022 and has now fallen to 3.6 years.
This is because rapidly increasing BEV sales, which are up 58% in 2022. Despite the fact of electric vehicles leaving the vehicle population when compared to ICE vehicles, the BEV sales are keeping the average age of that sector relatively young.
S&P notes that from 2013 to 2022, only 5.2% of ICE vehicles left the fleet, while 6.6% of BEVs were pulled out of commission.
Source: Reuters
