In the commercial segment, demand has leveled off after years of post-pandemic recovery. Meanwhile, rental fleets are stabilizing after sharp swings in recent years, and government volumes remain steady but constrained by budget pressures.
Looking ahead, 2026 will be less about what fleets did in the past and more about how they respond to cost pressures and tariffs.
COMMERCIAL FLEETS
BBM projects commercial sales to close 2025 at about 814,000 units, a slight decline from 2024, as higher interest rates and tighter budgets have delayed some replacements. Deferred demand may return in 2026, aided by a relatively stable economy and recent interest rate cuts.
Still, tariffs on imported vehicles and components remain a significant headwind, likely prompting fleets to extend lifecycles, diversify OEMs, and selectively acquire rather than aggressively expand. In the regulatory department, commercial operators are now exempt from California Air Resources Board (CARB) mandates, providing them with greater flexibility to manage costs and adopt electrification on their own timelines.
RENTAL FLEETS
Rental fleet sales are projected to reach approximately 1.037 million units by the end of 2025, marking continued growth post-pandemic but still well below 2019 levels. Travel demand remains solid, but rental companies are deliberately keeping fleets leaner than in 2019 to better manage utilization and residual values.
With resale markets normalizing and OEM allocations smoothing out, 2025 is expected to reflect stability rather than dramatic growth. For 2026, operators may cautiously expand fleets in line with steady consumer travel demand, but tariffs could disrupt that momentum.
GOVERNMENT FLEETS
Government sales are projected to be approximately 239,000 units in 2025, representing essentially flat year-over-year growth. The outlook for 2026 remains largely unchanged, with steady but limited growth, as tariffs exacerbate existing budget pressures.
While California public fleets remain under CARB rules, states previously subject to Section 177 mandates are now exempt, which will provide more flexibility in procurement.
2026: A RESET YEAR?
If 2025 was the year of plateauing and stabilization, 2026 has the potential to mark a “reset” toward normalcy in fleet sales. Order-to-delivery times are improving, supply chains are stabilizing, and fleets are shifting from reactive procurement to deliberate strategy.
Total volumes may edge upward, but tariffs are the swing factor. If they remain steady or ease, growth is likely; if they escalate, all three segments could feel the squeeze, pushing fleets back into lifecycle extensions and deferrals. ■
FLEET SALES, OVERALL & BY SEGMENT
