Key points: General Motors reported a 5.5% year-over-year decline in third-quarter new vehicle sales. Every one of the automaker's all-electric models posted sales declines. Meanwhile, Toyota reported a 0.6% sales increase for the most recent quarter, with electrified models including hybrids performing especially well.

General Motors (GM) announced on Thursday that its third-quarter new vehicle sales totaled 670,974 units, down 5.5% year over year. Sales of GM's all-electric models weakened across the board, as market enthusiasm for EVs is cooling. Last year, EV sales surged as the Trump administration prepared to eliminate a federal EV purchase subsidy of up to $7,500; in the same period a year earlier, GM's EV sales even set a record. Against that high base of comparison, EV sales plunged this year: the Equinox EV sold just 1,905 units in the third quarter, a 92.4% collapse; Blazer EV sales fell 84.4%; and Hummer EV sales dropped 72.9%.

Cox Automotive said in a report last week that the overall new vehicle market has performed strongly this year and raised its full-year 2026 sales forecast by about 2%, to 16.1 million vehicles. With high gasoline prices weighing on consumers, hybrids are expected to capture a larger share of the market. Although GM has a broad all-electric product lineup, the Detroit automaker currently offers only one hybrid model — the Corvette. Experts believe that the weak hybrid business will drag down GM's overall sales performance.

Hybrids helped other automakers outperform GM in third-quarter sales. Toyota Motor said that EVs and hybrids combined accounted for more than 57% of its total sales this quarter. Toyota's third-quarter total sales reached 633,223 units, up 0.6% year over year; electrified models including hybrids sold 363,367 units, surging 28.5%. That narrowed the gap between Toyota and GM, the U.S. sales leader, to less than 136,000 vehicles, compared with a full-year gap of about 335,000 vehicles last year. Cox Automotive suggested earlier this year that if the sales trend continues, Toyota could overtake GM in the coming years to become the top-selling automaker in the U.S. market.

Honda Motor also has a number of hybrid products and is a leader in fuel economy among mainstream U.S. automakers; Honda's third-quarter U.S. sales rose 9.3%, with hybrid sales exceeding 106,000 units in the quarter, a new high. Lance Woelffer, head of U.S. Honda automobile sales, said: "Demand for hybrids is very strong, and more and more consumers are realizing that hybrids can meet their driving needs."

AAA's national average gasoline price reached $4.41, and high fuel prices are also expected to hit the large pickup and SUV segments, which are precisely GM's core strengths. GM's full-size pickup sales were roughly flat. Sales for all of GM's brands have declined year to date, with Cadillac hit hardest, down 25%. In a high-inflation environment, GM's lower-priced models have become bright spots: Chevrolet Trailblazer third-quarter sales rose 51%, Buick Envista rose 18.4%, and Chevrolet Trax rose 16.3%.

Despite the overall sales decline, Duncan Aldred, president of GM North America, remains optimistic. "Our business overall is running well, and the launch of our next-generation full-size pickups is on schedule; we continue to invest in new models, innovative technologies, and U.S. domestic manufacturing capacity to drive the company's next phase of growth." Last month, GM announced news about a new V8 engine for its pickups, aiming to defend its leadership position in the pickup market.