Buyers looking to get the last of the pre-tariff prices on new cars, trucks, and SUVs last April have skewed the sales results coming for this April. Industry analysts at J.D. Power & Associates predict new car sales are going to fall 7.3% when reported next week.
New car sales for April are expected to be down 7.3%, according to J.D. Power & Associates.
Total new car sales will fall 7.3% versus last April, according to the analysts at J.D. Power & Associates. The number of new vehicles sold are expected to finish April at about 1.37 million vehicles, equating to a seasonally adjusted annualized rate (SAAR) of about 16 million units, which is considered a good year by automakers.
What happened
Sales were pulled ahead as automakers offered huge incentives on vehicles sold before the implementation of tariffs from the Trump administration that were predicted to increase new vehicle prices by as much as $10,000 per vehicle.
Car companies successfully lobbied President Donald Trump to adjust some of the tariffs and the car companies, mitigating some of the potential price increases and they also ate some of the losses on vehicles as well.
Trump’s tariffs were expected to raise prices on new vehicles so buyers rushed to find cheap prices.
“In April of last year, the industry was still feeling the effects of a tariff‑driven rush to retail lots, as an additional 53,000 consumers accelerated purchases ahead of anticipated tariff impacted price increases,” said Thomas King, president of OEM Solutions at J.D. Power.
“That pull‑ahead pushed April 2025 to an annualized sales pace of 17.2 million units — one of the strongest months of the year and well above the full‑year 2025 pace of 16.3 million units. As a result, traditional year‑over‑year comparisons provide limited insight into the underlying health of consumer demand again this month.
“Stripping out the inflated prior-year baseline, April 2026 points to continued resilience in new‑vehicle demand, even as consumers contend with elevated fuel prices and broader economic uncertainty.”
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Other factors
Buyers are also concerned about the affordability of new vehicles. The average retail transaction price is just under $46,000, according to Power data, and the average interest rate on a new car loan is 6.73%, which is down slightly from March, but still higher than car buyers are used to in recent years.
Affordability concerns are also keeping some buyers on the sidelines right now.
Despite easing borrowing costs, average monthly finance payments are expected to increase 3.1 percent year over year to $812, Power officials noted. Some of that is due to a decline in trade-in equity, which has been hampered by buyers who have negative equity on their vehicles. This forces buyers to either come up with the difference or rollover the amount owed into their new vehicle.
Average trade‑in equity is declining toward $7,099, down $660 from a year ago, while the share of vehicles carrying negative equity is trending to reach 31.3% — the highest level for the month of April since 2020 and an increase of 5.5 percentage points from 25.8% a year ago as consumers who purchased during the peak of inventory shortages four years ago return to market.
“In response, manufacturers are increasing incentive support to help offset the impact of negative equity. Average incentive spending per vehicle is trending towards $3,141, an 11.1% increase from a year ago,” King noted.
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