U.S. auto sales slow sharply

U.S. new-vehicle sales lost momentum in the first quarter, with March volume falling from a tariff-fueled surge a year earlier. (coxautoinc.com) Cox Automotive said the first-quarter selling pace finished at 15.6 million vehicles on a seasonally adjusted annual basis, slightly above its forecast but still part of a “relatively soft first half.” It kept its full-year 2026 forecast at about 15.8 million units, below 2025 levels. (coxautoinc.com) S&P Global Mobility projected March U.S. sales at about 1.37 million units, down from March 2025, when buyers rushed to dealerships ahead of tariff-related price fears. That comparison made this spring look weaker even though the March 2026 selling rate was still near 16.0 million. (spglobal.com) The slowdown is landing after a stronger 2025, when General Motors sold 2.85 million vehicles in the United States, up 6% from 2024. Morningstar said General Motors’ own first-quarter U.S. sales fell 9.7% on an equal number of selling days, with all four brands down from a year earlier. (finance.yahoo.com) (morningstar.com) Affordability is still tight. Edmunds said the average amount financed for a new vehicle hit a record $43,899 in the first quarter of 2026, while the average monthly payment rose to $773 from $741 a year earlier. (edmunds.com) Experian reported a similar pattern in late 2025: the average new-vehicle loan amount reached $43,582 in the fourth quarter, the average interest rate was 6.37%, and the average monthly payment climbed to $767. Dealers and lenders entered 2026 with buyers already stretched before sales cooled. (experian.com) For lenders, fewer new-car deliveries usually mean fewer fresh loans to book. The Federal Reserve Bank of New York said auto loan balances still rose to about $1.66 trillion at the end of 2025, even as overall delinquency rates worsened in the fourth quarter. (newyorkfed.org 1) (newyorkfed.org 2) A new Philadelphia Federal Reserve paper said the stock of auto loans that are 60 days or more past due is rising even though the flow of newly severe delinquencies looks fairly stable. That points lenders toward tighter screening, pricing changes, and more selective approvals if showroom traffic stays soft. (philadelphiafed.org) The industry is not slumping evenly. Cox Automotive said used-retail sales ran about 2% above year-earlier levels in the first quarter, while new electric-vehicle sales fell 27% year over year to 216,399 and held a 5.8% market share. (coxautoinc.com 1) (coxautoinc.com 2) That leaves automakers, dealers, and finance companies heading into the spring selling season with a slower new-car market, high payments, and little room for mistakes. Cox’s forecast still assumes steadier demand later in 2026, but the first quarter showed how quickly volume can thin when last year’s surge disappears. (coxautoinc.com)