Fueling the Shift: Hybrids Continue to Gain Momentum

Alternative fuel vehicles continued to gain momentum in the fourth quarter of 2025, driven by expiring electric vehicle (EV) tax credits and a growing preference for options that bridge the gap between full electric and traditional gasoline vehicles. According to Experian’s Automotive Consumer Trends Report: Q4 2025, alternative fuel vehicles accounted for 38.6% of new retail car registrations in the last 12 months, with 11% battery electric (BEV) and 27.6% hybrids and plug-in hybrids (PHEVs). This signals that the narrative about growth in consumer interest for alternative fuel is increasingly towards hybrids, not just full EVs. Taking a deeper dive, the Toyota Camry Hybrid led all alternative fuel car models, coming in 31.7% in Q4 2025. Rounding out the top five were Tesla Model 3 (19%), Honda Civic Hybrid (10.1%), Honda Accord Hybrid (9%), and Toyota Prius (5.3%). Interestingly, the Toyota Camry also stood out as the top model in both new and used car markets in Q4 2025, holding 12.2% of new car market share and 6.3% of used car market share. The Honda Civic ranked second in new car market share, coming in at 10.5% this quarter, while the Honda Accord secured the second spot in the used car market at 5.8%. The prominence of these vehicles leading both new and used car markets reflects a combination of strong new-vehicle sales and sustained demand in the secondary market. Data in the report also revealed strong loyalty within Toyota and Honda, with significant inflow between the two brands. For instance, 38.4% of Toyota Camry buyers replaced their vehicle with another Camry in Q4 2025, and 39.7% of Honda Civic buyers replaced it with another Civic. These trends reinforce the value of dealers monitoring evolving consumer preferences and aligning inventory with vehicles that offer fuel efficiency and flexible powertrain options as the market continues to shift. To learn more about car insights, view the full Automotive Consumer Trends Report: Q4 2025 presentation.

From the vehicles we drive to the way we purchase them, everything in the automotive industry is evolving as new technologies, shifting incentives, and changing consumer expectations continue to develop. As electrified vehicles continue to grow their presence on the road, Experian’s Automotive Market Trends Report: Q3 2025 took a deep dive into this segment and found that 5.5 million electric vehicles (EVs) and 11.7 million hybrids were in operation this quarter. Furthermore, data through the third quarter of this year found that 73.8% of EV owners returning to market replaced their EV with another EV and only 16.5% switched to a gas-powered vehicle. The significant EV loyalty among consumers signals that the ownership experience is delivering on core expectations. While some owners continued to opt for an EV because they’ve grown accustomed to certain conveniences such as charging stations at home or workplace to avoid traditional fueling and the perks of lower maintenance needs, others took advantage of the EV tax credits before they expired at the end of September. However, as these motivations shift, it will be important to monitor how the EV market unfolds over the next six months. Notably, 11.7% of gas-powered vehicle owners replaced their vehicle with a gas-hybrid vehicle this quarter, suggesting that hybrids are acting as an effective bridge toward deeper electrification. In fact, drivers may see hybrids as the ‘happy medium’ vehicle that offers improved fuel efficiency without requiring full reliance on charging infrastructure. Why this matters for the aftermarket As the majority of consumers replace their EVs with another one and some switch their gas-powered vehicle for an electrified one, these trends signal potential long-term commitment to alternative fuel segments. This is important to monitor for aftermarket professionals as the EV service volume continues to grow, requiring different parts and technician training. With consumers increasingly turning to the aftermarket for cost-effective support, professionals who adapt to diverse powertrains will be best positioned to navigate this evolving wave of post-warranty demand. To learn more about EVs and other vehicle market trends, view the full Automotive Market Trends Report: Q3 2025 presentation on demand.

The pickup truck market is shifting gears, and hybrids are emerging as a driving force behind the change. As more drivers prioritize fuel efficiency while still expecting towing power, hybrid models are stepping in to redefine the segment. According to Experian’s Automotive Consumer Trends Report: Q3 2025, gas-hybrid and plug-in hybrid pickup trucks accounted for nearly one-in-five new light-duty trucks sold, coming in at 17.8% this quarter. This signals a major shift in a historically ICE-dominated category. Hybrids are likely gaining traction because they offer the best of both worlds. While their systems provide fuel efficiency by combining gas or diesel engines with electric motors to avoid range anxiety, they’re also meeting most towing and hauling requirements that accompany the traditional gas-powered trucks. Overall pickup truck market trends fueling hybrid growth When looking at the market from a broader perspective, there were 55.3 million light-duty trucks on U.S. roads in the third quarter of 2025, representing 20.10% of all vehicles in operation. Furthermore, as of Q3 2025, 34% of U.S. households with one-or-more vehicles also own a light-duty pickup truck, giving this segment a strong foothold in transportation options. The widespread presence underscores the pickup truck’s influence in the automotive industry as they set the pace for consumer expectations and steer market trends. The increased momentum for hybrid trucks can also help OEMs and dealers capitalize on growing their presence in an increasingly competitive space. It’s important for automotive professionals to consider aligning sales strategies with evolving buyer preference to elevate consumer engagement as this trend offers benefits today and even greater potential ahead. To learn more about pickup truck insights, view the full Automotive Consumer Trends Report: Q3 2025 presentation.