Autos are seen on Interstate 35 through Austin during evening rush hour. Texas is poised to overtake California as the nation’s largest buyer of new autos, a new study finds, a move that could give Texans’ car preferences more influence across the U.S.
Sara Diggins/American-Statesman
As the top auto market in the U.S., California has long had outsize influence on the nation’s car culture.
Now, the balance is shifting toward Texas.
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As new vehicle purchases in the Golden State drop off, Texas is seeing a boost in sales that could give its preferences a bigger impact across the rest of the country.
“ ‘Auto trends start in California’ is a mantra that has been repeated so often that few doubt its veracity,” JD Power said in a recent report on the shift. “But that long-standing assumption about the U.S. auto industry is poised to be turned on its head.”
The market research firm found that Texas is about to overtake California as the top market for new vehicle sales. Through the first quarter, California’s total market share of new-vehicle sales fell to 11.4% while Texas increased to claim 10.8% of the market.
The shift comes as Texas sees high population growth and after automakers moved to the state from California, including Toyota Motor Corp. in 2014 and Tesla Inc. in 2021. When Toyota announced its move, Tyson Jominy, senior vice president of customer success at JD Power, said it “raised eyebrows,” much like Nissan’s move earlier in the decade to Nashville.
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“But it seems very prescient now, looking back, given how important Texas is to the nation,” he said.
If the state takes the lead in new-car sales, Texas drivers’ preferences could have a bigger impact on the types of vehicles seen as trendy across the nation. High prices for pickup trucks and other large vehicles preferred by many Texans have already made the state the top auto market by dollars spent for three years running. JD Power says that provides hints on the future direction of the new-car market.
“We know about pickup trucks in Texas and large SUVs, but in many ways it’s more reflective of the rest of the nation,” Jominy said. “Americans love their big vehicles, and Texas — they’re just like that, but even more so than everyone else.”
The devotion to pickups remains in Texas even as gasoline prices have jumped, while higher pump prices in California are slowing such sales. Regardless, auto industry leaders are betting that buyers of trucks with six-figure prices won’t be so concerned about the cost of fuel.
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As an example, Jominy pointed to Ram Trucks CEO Tim Kuniskis, who admitted that new premium models of its trucks will have “terrible” gas mileage.
Many drivers in Texas gravitate to pickups as a work truck, for hauling or towing and for off-roading or outdoor activities. It’s also just tradition.
“It’s long term societal trend in Texas. Pickup trucks and Texans, just they go together,” Jominy said. “It’s like Texans and barbecue. They just go together.”
What Texas’ influence means for EVs
A worker assembles a Tesla Model S in 2012 at the Tesla factory in Fremont, Calif.
Paul Sakuma/AP
In California, consumers have gravitated to hot rods and luxury vehicles, and the state continues to be a stronghold for sales of sedans even as the segment declines nationwide.
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California drivers were also some of the earliest adopters of hybrids and electric vehicles.
But California’s zero-emission vehicle market share tumbled to 13.7% in the first quarter of 2026, the lowest share recorded since the fourth quarter of 2021. The California New Car Dealers Association attributed the slippage to the phase-out of federal EV tax credits and affordability pressures amid a U.S. economic downturn.
At the same time, though, Texas EV sales have been “very resilient,” Jominy said.
In Texas, alternatively fueled vehicles represent less than 4% of the total number of vehicles registered. But their numbers have jumped about 215% in the past five years, compared with 6.9% growth in total vehicle registrations during the same period. Every week, Texas sees an additional 1,500 EVs on the road, according to vehicle registration data from the Texas Department of Motor Vehicles.
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Texas is narrowing the gap in new-vehicle retail share in part because Californians facing higher pump prices and other economic pressures are gravitating more toward used vehicles. Still, Jominy said the state’s used car buyers can be lured back into buying new with higher incentives, enticing new models and aggressively priced entry level models.
And when it comes to EVs, new incentives could be around the corner in California, as state officials are reportedly considering a plan to offer $3,500 in instant rebates to new EV buyers.
“There’s a lot of ways to get used buyers back to the new market, so it’s not always going to be set in stone that Texas will overtake California and remain that way forever,” Jominy said. “But demographically speaking the movement is toward Texas, away from California. There’s still a lot more buyers of cars in California. It’s just that right now they’re choosing to buy more used vehicles than new.”
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