Fleet Vehicles: What to Expect in the Auto & Fleet Industry for MY2025

Depending on who you ask, the U.S. economy is strong and expanding as evidenced by certain financial bellwethers, including low unemployment and decreasing (albeit slowly) inflation. This seeming stability is a far cry from the chaotic economic landscape four years ago at the beginning of the pandemic, which created upheaval worldwide, hitting industries with high unemployment, supply chain issues, and product shortages. The automotive industry was not exempt from any of it. But now, there are some positive signs that it’s slowly inching back to pre-2020 levels, perhaps indicating that the industry is starting to even out in preparation for growth not seen in years.

Let’s look ahead with Mike Albert fleet expert Jason Kraus at how these developments could impact fleet purchases for model year (MY) 2025 cars, pick-ups, compact cargo vans, SUVs, and hybrids:

Positive Signs Point Towards Pre-2020 Levels

• Order-to-delivery (OTD) is still extended from 2019. However, that extension is shrinking. In MY2024, OTD has averaged over 4.4 months, down from 6.0 months in MY2023, but still higher than the 3 months in MY2019.

• Production levels continue to improve, forecasted to reach 15.9 million units in 2024. This is up from 14.4 million in 2020 but is still well below the 17.1 million produced in 2019.

• Some specific vehicle types, like cars and sport utility vehicles (SUVs), are back to average production and dealer inventory. Other types, like pick-up trucks and vans, are improving but are still in low stock. In particular, demand for 2024 vans still far exceeds current production, and fleet managers are struggling to find fleet-configured vehicles.

• For owners purchasing 2025 model-year vehicles, incentives should closely mirror those from 2024 model-year vehicles.

Insights of Vehicle Segments Based on MY2025 Details Published to Date

• Cars, SUVs and full-size (1/2, ¾ and 1 ton) pick-ups appear to be on an open-order basis.
• The good news: allocation does not have to be awarded for most Original Equipment Manufacturers (OEMs).
• The bad news: order banks are unlikely to quickly close this year, but don’t wait four-plus months to get started on executing your MY2025 plan to obtain the desired trim/specs.
• Specific to full-size SUVs, General Motors is on an allocation basis for MY2025 for models such as Chevrolet Traverse, Tahoe, Suburban, GMC Yukon, and more.

MY 2025 Cargo Van Market Forecast

• The MY2025 RAM ProMaster order bank is on an open-order basis with a big increase in production capacity and improved logistics.
• The MY2025 Mercedes Benz Sprinter order bank is also on an open-order basis featuring a 24-week order-to-delivery timeframe from the Charleston, SC facility.
• The MY2025 Chevrolet Express and GMC Savana are available on an allocation-only basis; order banks open in August 2024.
• The MY2025 Ford Transit has not yet been published (expected in August 2024). Directionally, the MY2024 allocation for non-national account clients was 45 units for the entire year. This was increased at the end of May by an additional 40 units, topping out at 85 units for 2025. As a result, MY2025 is likely to be on an allocation basis due to the higher unit count.

Navigating the MY 2025 Hybrid Vehicle Market

• Some hybrid options are available on an open-order basis, such as MY2025 Toyota Camry (now only offered as a hybrid, with the option of AWD), MY2025 Hyundai Elantra/Sonata/Tucson/Santa Fe hybrid and plug-in hybrid electric (PHEV) variants, and MY2025 Volvo XC60/XC90/S90 T8 variants.
• Toyota will continue to offer several of their MY2025 hybrid models including the Highlander hybrid, RAV4 hybrid, RAV4 Prime and Sienna on an allocation basis. There will also be several MY2025 hybrid models offered on an open order basis in addition to the Camry such as Corolla hybrid, Corolla Cross hybrid, Prius, Prius Prime, Tacoma hybrid, and Tundra hybrid.
• Ford has just announced to offering up to 10 of MY2025 Escape hybrid or PHEV variants to those with a fleet code. Still awaiting the details for MY2025 Maverick hybrid.
• MY2025 marks the fourth year of Honda offering a fleet program. Hybrid options will include Civic 4-door and Hatchback hybrid, CR-V hybrid, and Accord hybrid.
• If you want to understand other electrified options, check out Mike Albert’s video and accompanying article on other EVs.

Challenges and Solutions to Replace Compact Cargo Vans

• North American production has stopped over the past few years for compact cargo vans, and it will still be a few years until EV options are offered in the marketplace. Mileage on the existing compact vans in fleets is increasing; therefore, so are fleet vehicle maintenance expenses.
• In the interim, fleet managers have options based on payload and what compact cargo vans are transporting:
• More payload and/or transporting chemicals? Consider a mid-size pick-up truck with upfit. A cap on the back of the bed with a pull-out drawer can quickly turn these vehicles into workhorses for fleet operations.
• Less payload for small parcel delivery? Consider a compact or mid-size SUV with upfit. By folding the rear seats down to maximize space and increase residual value later, adding a partition for driver safety, and different floor and organization options, these SUVs are great options that would also improve fuel economy versus existing compact vans.
• Upgrade from a compact van to a cargo van with a low roof such as the MY2025 RAM ProMaster with a 118” wheelbase or a MY2025 Ford Transit.

Known Challenges for MY '25 Mid-Size Pickups by Manufacturer

• The MY2024 Toyota Tacoma order bank remains open for several months and orders of up to 30 units can be placed provided you have a Toyota fleet code. However, the MY2025 Tacoma will return to an allocation program.
• The MY2025 Nissan Frontier order bank has just opened on an open-order basis. Anyone looking for the Frontier in S trim should move quickly as demand will outpace supply.
• MY2025 Chevrolet Colorado and GMC Canyon factory orders for 2025 have already been 100% allocated; for most fleets this means that factory orders will not be possible. Using an out-of-stock locate approach is an option to get these models, but it means a higher price per unit.
• MY2025 Ford Ranger has not yet been published (expected August 2024). Directionally, MY2024 allocation for non-national account clients was 7 units for the entire year. MY2025 is likely to be on an allocation basis, with a higher unit count.
• Flexibility, instead of all-in, is the key to any MY2025 plan for these vehicle segments.

When it comes to the auto and fleet industries, “the only constant is change”—so we can expect the landscape to shift even more going forward. Stay ahead of the curve and up to date on fleet resources and news by following Mike Albert on LinkedIn.

For more information on model year 2025 forecasts and the current state of production, hear from Kraus in these Fleet Studies Lab articles:

• Electric Vehicles: What to Expect in the Auto & Fleet Industry for MY2025
• Medium & Heavy-Duty Commercial Vehicles: What to Expect in the Auto & Fleet Industry for MY2025

Mike Albert Fleet Solutions’ Jason Kraus is Director, Vehicle Acquisition & Lease Structure for the company. Connect with Jason on Linkedin.