Next time you're driving down the road, look around. On average, 1 in 4 cars and trucks you pass are at least 16 years old, according to new analysis of what Americans are driving.
IHS Markit, which tracks vehicle registrations in every state, says the large number pre-2005 cars and trucks on the road is one reason the average age of vehicles in the U.S. has climbed to an all-time high of 11.9 years.
"A lot of it has to do with quality of the vehicles on the road," said Todd Campau, after-market specialist with IHS Markit. "They are comfortable keeping that vehicle longer than they would in the past."
2020 is the fourth straight year the average vehicle age in the U.S. increased, extending a trend over the last two decades during which Americans hang on to their cars and trucks longer. A decade ago, the average age of a vehicle in the U.S. was 10.6 years according to IHS Markit. In 2002, the average age was 9.6 years.
"In the mid-'90s, 100,000 miles was about all you would get out of a vehicle. Now, at a 100,000 miles a vehicle is just getting broken in," said Campau.
With the economy struggling due to Covid-19, prompting companies to lay off millions of Americans, the age of vehicles in the U.S. is likely to rise. It may even climb at a faster rate, according to IHS Markit.
That's because millions of people who used to commute to their jobs are now putting fewer miles on their cars as they work from home. As a result, their vehicles are likely to last longer. In addition, many who may been ready to buy a new car or truck are likely to continue driving their old one or trade it in for a used model, a market where sales have been surging.
"We went out and bought a lot of preowned (cars) and said if customers can't get new, this demand is so strong they will switch to preowned," AutoNation CEO Mike Jackson told CNBC's "Squawk Box." "That is exactly what happened."
The U.S. now has a record 280 million cars, trucks and SUVs registered with state motor vehicle departments. IHS is forecasting about 14 million new cars, trucks and SUVs will hit the road in the U.S. this year, while the same number of vehicles will be scrapped and taken off the road.