New-vehicle demand held steady in October 2026, even as affordability pressures refused to ease. According to J.D. Power’s latest sales forecast, reported by Dealership Guy, the seasonally adjusted annual rate fell from 16.1 million units in September to 15.6 million in October — about the same as October 2025.
Total sales were expected to be about 1.3 million units, almost the same as in September, with results rising 0.2% year on year, or 3.9% without adjusting for selling days, according to J.D. Power President of OEM Solutions Thomas King, quoted in the forecast release. Last October was itself depressed by a sales decline after clean-vehicle credits for EVs expired on September 30, 2025, so matching it is not a sign of strength so much as resilience.
The affordability numbers explain why demand is flat rather than booming. The average transaction price was $46,329 in the J.D. Power forecast, with average monthly payments rising $2 in the past month to a record October high of $823 and interest rates inching up to 6.81%. A separate September analysis from the Alliance for Automotive Innovation put the average transaction price at $45,915, up 0.7% from a year ago, with average monthly finance payments up 3.2% to $821, the highest ever for September.
Incentives are doing heavy lifting
Manufacturers are leaning harder into discounts to keep buyers in the market. Average incentive spending per vehicle was trending toward $3,574 in September, up 7.3% from a year ago, according to the Alliance analysis, with incentives as a percentage of MSRP expected to hit 6.9%. Incentive spending on traditional and hybrid vehicles rose $797 per unit year on year to $3,319, while EV incentives fell $2,450 per unit to $8,829 — a sign that EV discounts are normalising after the post-credit surge.
Edmunds estimated negative equity slightly above 29% in the J.D. Power coverage, meaning nearly three in ten trade-ins owed more than the car was worth. That, combined with higher rates, increases the amount financed and the cost of financing it, according to King.
What buyers should take from this
A flat market is a buyer’s market in disguise. Dealers with 15.6 million-pace sales still need to hit monthly targets, and incentive spending near $3,574 per vehicle gives room to negotiate — especially on outgoing 2026 models as 2027 stock arrives. Get pre-approved before visiting a dealer, compare the total financed amount rather than the monthly payment alone, and think twice about rolling negative equity into a new loan: it is the fastest way to turn a flat market into a personal debt spiral.
See also our EV sales report and hybrid sedan ranking.
