Stellantis Finally Pulls Out of its Sales Slump – But Federal Shutdown Weighs Over the Entire Industry

Strong sales by the Jeep and Ram brands helped Stellantis reverse its long sales slide during the third quarter, even as Volkswagen faltered in the face of a challenging economy. While U.S. auto sales are running stronger than expected, analysts still worry about the impact of tariffs and the federal government shutdown in the months ahead.

After watching its sales tumble by double digits during the first half of the year, Stellantis was able to pull out of its tailspin by posting a 6% upturn for the third quarter, ending September 30.

Automakers, in general, managed to defy concerns about tariff price hikes and a weakening economy, total sales for September coming in about 7% above year-ago numbers. The one major exception was Volkswagen which failed to benefit from a surge in demand for EVs.

Both General Motors and Ford Motor Co. reported sales increases for the third quarter driven by the impending end of federal EV tax credits on September 30. Demand also ran strong for hybrids and plug-ins, with Toyota reporting electrified vehicles made up nearly half of its sales for the month.

Strong September sales came as a positive counter to recent concerns about the U.S. economy. But industry analysts worry that tariff-driven price hikes and the uncertainty caused by the federal government shutdown, could create unforeseen problems.

Jeep, Ram chalk up big gains

Several of the Stellantis brands in the company’s broad portfolio gained ground during the third quarter, according to U.S. officials said.

“Fueled by sales growth across the Jeep_, Ram, Chrysler and Fiat brands, our U.S. sales saw strong results in the third quarter, including the month of September which was our highest monthly market share in the U.S. in 15 months,” said Jeff Kommor, head of U.S. Sales.

“We are taking deliberate actions, including the highly anticipated return of the Hemi V-8 to Ram, the introduction of the all-new 2026 Dodge Charger Scat Pack, and the return of the all-new 2026 Jeep Cherokee, a critical vehicle in the CUV segment, to keep that sales momentum moving forward, with all vehicles set to arrive in dealerships now through the end of this year.”

Jeep brand total U.S. sales increased 11% in Q3 year-over-year, while Ram brand saw U.S, retail sales increase 26% increase year-over-year in Q3 versus the same period last year. Chrysler minivan sales grew 51% quarter-over-quarter.  Dodge Durango delivered its best total third quarter sales in 20 years; up 44% in total sales year-over-year.

VW is the outlier

Volkswagen of America reported third-quarter sales decreased 6% year-over-year in what the company described as a “challenging environment.”

Despite the decrease in overall brand sales, VW did gain ground with its SUVs, including both gas models  like Atlas and Tiguan, as well as its all-electric ID.4 – which was bolstered by the impending end of EV-tax credits.

But VW took a big hit in the passenger car segment which saw demand drop 41% year-over-year. All three models, the Jetta, GTI and Golf R were in the loss column.

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EVs drive demand for Korean brands

A big increase in sales of electric vehicles and hybrids helped Hyundai and Kia post double-digit gains last month as consumers moved to take advantage of an expiring federal tax credit toward EV purchases.

Electrified products, in general, played out well for the industry in September. That was especially apparent at Toyota Motor North America which reported a combined 14.2% jump in U.S. sales for its Toyota and Lexus brands. Toyota has the largest line-up of electrified products among any full-line manufacturer – hybrids available, either as an option or standard fare on all but two product lines. EVs, HEVs and PHEVs accounted for 45.8% of the automaker’s total volume last month.

All told, EVs alone accounted for roughly 11.5% of total U.S. new vehicle sales in September, said Tyson Jominy, senior vice president of data and research at J.D. Power. The figure was closer to 8% during the first eight months of the year. But Jominy cautioned that a significant “pull-ahead” driven by the phase-out of federal tax credits could be followed by a sharp fourth-quarter slump.

Analysts upbeat about Q4

Thanks to the strong sales in the third quarter and the boom in EV sales, Cox Automotive raised its sales estimate for the full year to 16.2 million units. That would be up around 200,000 over the 2024 total.

But analysts caution that the fourth quarter could be marked by price hikes caused by the Trump tariffs and a sharp drop in EV sales. The twin slumps in the farm economy and construction of new houses also could begin to weigh on the auto industry which also has become more dependent on affluent upper income consumers, Cox and other analysts warned.

The government shutdown also could weigh on carmakers. Shutdowns can squeeze the economy in different ways, from missed paychecks for hundreds of thousands of federal employees to the delayed release of crucial economic indicators. But duration matters. The longer the closure lasts, the greater the hit to economic growth and the work of businesses that rely on the federal government’s daily functioning.,” The Wall Street Journal observed.