U.S. Auto Sales Could Plunge Amid Iran War, Data Shows

Historically, oil crises have caused U.S. auto sales to fall by more than 10%, sometimes by as much as 40%.

Mar. 13, 2026 at 10:05am

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As gasoline prices continue to rise due to the war in Iran, there are concerns that U.S. auto sales could plummet. According to data compiled by a Lansing-based economic consultancy, past oil crises have led to significant drops in auto sales, sometimes by as much as 40%. However, factors like more fuel-efficient cars, remote work, and the availability of EVs may lessen the impact this time.

Why it matters

The U.S. auto industry is highly vulnerable to oil supply shocks, as past events have shown. A sharp decline in auto sales could have widespread economic consequences, impacting jobs, tax revenue, and consumer confidence.

The details

The war in Iran has led to wild swings in crude oil prices, causing the average price of gasoline to hit about $3.60 per gallon as of March 12, up from $2.89 a month earlier. In six past instances of oil crises, auto sales dropped by more than 10% of average sales, with three of those times seeing a plunge of 40% or more.

  • On February 28, the United States and Israel bombed Iran after President Donald Trump said Iran was building nuclear weapons.
  • Iran retaliated by attacking Israel and Middle Eastern countries that host U.S. military bases.
  • On March 12, two tankers were on fire in an Iraqi port after being hit by suspected Iranian explosive-laden boats.

The players

Anderson Economic Group

A Lansing-based economic consultancy that compiled the historical data on how oil crises have impacted U.S. auto sales.

Patrick Anderson

The CEO of Anderson Economic Group, who stated that "history shows that Americans cut back sharply on buying cars when wars, invasions, and oil embargoes occur."

Donald Trump

The U.S. President who said Iran was building nuclear weapons that threaten U.S. allies.

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What they’re saying

“History shows that Americans cut back sharply on buying cars when wars, invasions, and oil embargoes occur.”

— Patrick Anderson, CEO, Anderson Economic Group

What’s next

The judge in the case will decide on Tuesday whether or not to allow Walker Reed Quinn out on bail.

The takeaway

This analysis highlights the auto industry's continued vulnerability to oil supply shocks, even as factors like fuel efficiency and electric vehicles may lessen the impact compared to past crises. Policymakers and industry leaders will need to closely monitor the situation and prepare for potential disruptions to auto sales.