GM Q3 Sales Drop 5.5% as Toyota Sales Gap Narrows to Under 136,000

General Motors reported a 5.5% year-over-year sales decline with 670,974 new vehicles sold during the third quarter, while competitor Toyota Motor narrowed the U.S. sales gap as its electrified vehicle sales surged 28.5%. The figures highlight a sharp divergence in how traditional automakers are managing cooling consumer demand for all-electric vehicles and rising interest in hybrids.

General Motors reports electric vehicle sales declines

GM reported that sales of all-electric vehicles are down across the board following a spike in demand last year ahead of the Trump administration ending up to $7,500 in federal incentives for consumers. During the same period last year, GM reported record sales of its electric vehicles. Against those comparisons, EVs saw dramatic drops during the third quarter, with the Equinox EV down 92.4% at 1,905 vehicles sold. The Blazer EV fell 84.4% and Hummer EV sales dropped 72.9%. Cadillac is leading the decreases across all divisions, seeing a 25% drop so far this year.

Despite the overall downturn, GM’s lower-cost vehicles provided a bright spot as consumers face high inflation. The Chevrolet Trailblazer rose 51% for the third quarter, while sales of the Buick Envista increased 18.4% and the Chevrolet Trax gained 16.3%. Full-size pickups remained relatively flat. Duncan Aldred, President of GM North American, said in a statement that the company’s business is performing very well, noting that the launch of next-generation full-size pickup trucks is on track and that investments are underway in new vehicles, innovative technologies, and the U.S. manufacturing footprint. Last month, GM announced additional details about new V-8 engines for its pickup trucks to maintain leadership in truck sales.

Toyota and Honda capture market share with hybrids

While GM offers only one hybrid vehicle—the Corvette—rival automakers benefited from strong consumer demand for fuel-efficient alternatives amid inflated gas prices. Toyota Motor reported that its EV and hybrid vehicles made up over 57% of its sales during the third quarter. Toyota total sales rose 0.6% to 633,223 vehicles, while electrified vehicle sales jumped 28.5% to 363,367 units. That performance helped Toyota narrow its gap with U.S. sales leader GM to less than 136,000 units, compared with a full-year gap of roughly 335,000 units last year. According to earlier analysis from Cox Automotive, persisting sales trajectories of this nature could position Toyota to surpass GM and reclaim the title of top U.S. seller down the line.

Honda Motor reported a 9.3% increase in U.S. third-quarter sales, driven by record hybrid sales of more than 106,000 units. Lance Woelfer, head of American Honda Motor’s U.S. sales, told CNBC that high demand for hybrids reflects consumers finding that hybrids meet their needs. Cox Automotive reported last week that new vehicle sales have been stronger than expected this year, raising its 2026 forecast by roughly 2% to 16.1 million units.

Automakers prepare for shifting consumer demand

High fuel prices, marked by an AAA national average of $4.41, continue to influence purchasing decisions across the automotive sector. Experts expect GM's weakness in the sector to impact its overall sales as competitors use electrified lineups to capture market share.

Analysts are watching to see if GM will expand its hybrid offerings beyond the Corvette to counter competitors or if its upcoming truck launches and lower-cost internal combustion models will stabilize its market position as the industry moves toward the final quarter of the year.