Trends in the US Auto Industry: Key Insights from the 2026 Auto Forum New York
I covered the Automotive Forum New York, the day before the New York International Auto Show. This event connects Automotive thought leaders with Manufacturers and Dealers. Attendees learned about trends and insights in the Automotive industry that focus on the dealer side of the business.
The auto forum started with an economist who analyzed the US Economy as a whole, followed by Thomas King, President, Data & Analytics Division, Chief Product Officer at JD Power, who analyzed the US auto industry, addressing the issue of disappearing EV Tax credits, a surge in lease returns that will reshape the inventory and demand planning. Thomas also addressed the issue of softening trade equity and the rise of subprime lending.
The State of the Automotive Industry
Thomas shared some interesting statistics and analysis.
The total and retail vehicle Sales in the US for the first quarter are 3.7 million, down from a year ago on a retail basis are 2.9 million or 9% per week.
Vehicles were sold with larger discounts than the previous year at $3300 per unit. This has a negative impact on manufacturer profitability. In terms of new vehicle sales last year, the industry set an all-time high for money spent on vehicles. A great result, but a 7% decline. In terms of retail confidence on a per-unit basis, it was down $50 or $2. Retail volume was $6.1 million, a strong number that was down 10% from a year ago.
The Automotive Industry is in good shape based on the data.
Prices are rising for vehicles. On average, a new Vehicle costs $46000, up $1000 from last year. Tariffs did not impact pricing because manufacturers absorbed them, as passing the cost to consumers would decrease sales. Manufacturers' profitability remained stable. Manufacturers are planning to increase Sales and Market share.
EVs are not driving Sales. With EV incentives gone, consumers are shifting to Gas Vehicles. Manufacturers are shifting back to more gas vehicles to meet consumer demand.
In terms of lease payments, the average last year was $636 per month, and now it is $650, a modest increase for 36-month leases. With rising lease prices, dealers have a chance to convert lessees to new car buyers with 2.4 million leases ending this year. 13 percent of financed leasing sales are on loans that are 84 months or longer. Subprime lending can help increase sales if it is monitored and controlled. Subprime lending increased in the 1st quarter.
Trade-ins were a selling point for dealers with the supply constraint back in 2022, with the average price being $29000. Vehicles traded in have lower equity because customers paid above sticker price back in 2022.
Rising fuel prices will hurt new vehicle sales on leases because, as lease payments go up, the amount spent on gas decreases. However, people whose vehicle costs $46000 on average are less sensitive to rising gas prices. Car buyers who do not lease cars are less affected by rising gas prices. 2.8% percent of income is spent on fuel.
Lower interest rates will make car buying and leasing less expensive.
Consumers are on track to spend $623 million on new vehicles. Consumer spending predicted to be at an all-time high. Retailer profits are expected to be $25.4 billion, down from $28.9 million a year ago.
Volume is the same as last year, with the total number being 16.3 million and 13.6 million for retail.
Improving the Customer Experience at Auto Dealerships
A panel discussed how to improve the customer experience. Liza Borches and Rob Cochran shared their insights. The panel suggested being transparent to build customer trust, especially with pricing. Customers want to know how much a car will cost. Transparency also applies to service. Service is a profit center for dealers; this is an opportunity. Currently, there is a shortage of technicians. When customers see a price, they want to know if this is the final price. OEMs can improve the customer experience for customers by listening to and providing customers with what they want based on their needs.
The panel also shared that dealer must use AI to automate their processes without losing a human touch.
AI’s Impact on Car Buying
A panel AI in Auto discussed how AI is transforming vehicle buying and dealership operations. Jason Goldberg, GM, Global Client Development, The Trade Desk, Liam Golightley, Vice President, Customer Success, Podium, Jenni Newman, Editor-in-Chief, Cars.com, Brian Abrams, VP, Product Management, CDK, shared their insights. Brian Abrams moderated the panel.
47 percent of consumers are using AI to date, and 64 percent of consumers use AI in their car shopping journey, but they want a human touch at the dealership, according to Cars.com. 70 percent of consumers are undecided on the make and model of a vehicle, according to Cars.com. AI is shortening the buying process by helping consumers become more informed faster. 67 percent of auto dealers are using AI, and their Business Development Center. AI is transforming the way consumers buy vehicles and how dealerships operate.
What’s next for OEMs, Dealers, and Manufacturers?
Senator Bernie Moreno, a former car dealer, advised dealers and manufacturers on improving relationships with one another and the US Government in the One on One with Senator Bernie Moreno panel. John Fitzpatrick, CEO, Force Marketing, moderated the discussion.
He shared about affordability in America. The Senator shared how the administration stopped California from submitting its own set of emissions standards. The goal is to have one set of emission standards to sell more cars abroad. He discussed removing the market distortion that EV mandates imposed on the auto market. EV mandates cost the industry 100 billion dollars. This is money that could have been spent on innovating cars and the industry as a whole.
Bernie discussed allowing US automakers to collaborate on expensive new technologies to compete with Chinese Automakers. He described having Chinese cars here as a national security issue because they have cameras and would need to be connected to US infrastructure, a big risk.
The Senator discussed making more affordable cars, offering a $25000 car as Honda does. He also discussed service in the dealer franchise model. Dealers and Manufactures need to improve how they handle warranty issues for customers.
It was a great event with many great panels. I learned a lot about the automotive industry.
I want to thank J.D. Power, NADA, and the New York International Auto Show for having me as their guest.
