New-vehicle stock fell to 2.69 million units by Tuesday, April 1, according to auto data company Cox Automotive. That was down 10.2% from the start of March and 2.4% lower than the same time in 2024.
Buyers flooded showrooms in the final week of March, driven by seasonal trends and fears of price hikes tied to Trump’s rapidly changing tariffs.
“With import tariffs now in place and parts tariffs likely to start in May, we expect supply to tighten even more in the weeks ahead,” Cox said in its report from Thursday, April 10.
The late-March buying spree pushed the 30-day sales pace up 17.2% from late February and nearly 12% above the same point in 2024.
The demand drained dealer lots nationwide, cutting the US supply to 70 days’ worth of new cars at the start of April. That was down sharply from 91 in early March, sinking auto inventory to levels not seen since 2023.
Lincoln saw the steepest drop, with a 54-day decline in supply. Ten automakers lost 30 or more days’ worth of inventory in just one month.
According to Cox, the average new-vehicle listing price fell 0.6% to $47,962 in March, though prices were still nearly $900 higher than in March 2024. Ford had the biggest drop at $599, followed by Hyundai and Chevrolet.
Prices rose, however, for Honda and Toyota – a sign that low supply is already driving up costs for popular models.
“As pre-tariff inventory is depleted, automakers distribute these additional costs across their entire portfolio of vehicles,” said Cox. “Tariffs led to a surge in March sales, reducing inventory levels, especially for manufacturers with already low stock levels.”
Incentives stayed flat in March at 7% of the average transaction price – about $3,339 per vehicle – but those discounts could soon disappear.
“As a result of these tariffs and the tightening inventory, and without a policy change in Washington, consumers should anticipate higher prices and fewer discounts on new vehicles by summer,” Cox said. “Over time, we can expect a decline in both production and sales, leading to increased prices for both new and used cars.”
Trump’s tariffs have fueled massive market instability, especially for the auto industry that’s still recovering from the COVID-19 pandemic and ensuing supply chain shortages. The most impactful duties include 25% tariffs on imported cars, light trucks, aluminum, and steel, along with a 145% tariff on Chinese goods.
Consumer confidence plunged 11% from March to April in the fourth straight month of decline, according to a closely watched survey from the University of Michigan. The survey also found that inflation expectations surged to their highest level since 1981.
Many CEOs also say a recession is likely within six months, according to another April survey from Chief Executive. The industry group’s poll found 62% of CEOs expect a recession and nearly four in 10 plan to cut jobs in 2025.
Analysts warned that the current auto industry squeeze resembles the beginning of the 2021 chip shortage, when tight inventory drove record prices and months-long waits for new cars.
“Additionally, some models may be discontinued as automakers adjust their strategies to cope with the new economic landscape,” said Cox.
Some automakers like Ford and Stellantis – which owns brands like Chrysler, Dodge, and Jeep – have offered employee pricing for all customers to keep sales steady amid the economic turmoil from Trump’s tariffs.
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