Auto Industry Faces Demographic Cliff
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Jun 28 2026
0mins
Source: CNBC
- Market Contraction Warning: Bain & Company forecasts a decline of over 2 million vehicles sold in the U.S. by 2040, driven by falling birth rates and high car prices, indicating that automakers will face fierce competition in a shrinking market.
- Changing Driving Habits Among Youth: Data shows that only 50% of 16-year-olds in the U.S. will have a driver's license by 2025, a significant drop from nearly 70% between 1966 and 1984, reflecting a weakening demand for cars among younger generations, which could impact future vehicle registrations.
- High Prices Affecting Purchasing Power: New vehicle monthly payments have risen by 30% over four years, with nearly one in five new vehicles costing over $1,000 a month, leading younger consumers to prefer ride-sharing services like Uber and Lyft, further compressing the potential customer base for new cars.
- Intensifying Competition and Market Consolidation: As competition intensifies, the U.S. auto market is expected to face consolidation pressures, particularly among the 450 brands, as manufacturers must devise new strategies to cope with diverse consumer choices and market contraction.
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Analyst Views on F
Wall Street analysts forecast F stock price to fall
14 Analyst Rating
3 Buy
10 Hold
1 Sell
Hold
Current: 13.830
Low
11.00
Averages
13.65
High
16.00
Current: 13.830
Low
11.00
Averages
13.65
High
16.00
About F
Ford Motor Company develops and delivers Ford trucks, sport utility vehicles, commercial vans and cars, and Lincoln luxury vehicles, along with connected services, including BlueCruise (ADAS) and security. The Company's segments include Ford Blue, Ford Model e, Ford Pro, and Ford Credit. The Ford Blue segment primarily includes the sale of Ford and Lincoln internal combustion engine (ICE) and hybrid vehicles, service parts, accessories, and digital services for retail customers. The Ford Model e segment primarily includes the sale of its electric vehicles, service parts, accessories, and digital services for retail customers. The Ford Pro segment primarily includes the sale of Ford and Lincoln vehicles, service parts, accessories, and services for commercial, government, and rental customers. The Ford Credit segment consists of the Ford Credit business on a consolidated basis, which is primarily vehicle-related financing and leasing activities. Its vehicle brands are Ford and Lincoln.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Intensified Sales Competition: In the first half of 2026, Ford's F-150 fell short of Honda's CR-V, which achieved a 19% and 30% sales increase in May and June respectively, totaling 226,114 units, indicating the fierce competition in the market.
- Production Challenges: Two supplier fires last fall severely impacted Ford's aluminum supply, leading to reduced production capacity for the F-150, with expected EBIT losses of $1.5 billion to $2 billion in 2026, forcing management to adjust earnings guidance.
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