US new-car market growth impacted by multiple factors in April

24 April 2026

New-car sales in the US are expected to fall in April as the market faces varied pressures. However, the comparison with April 2025 is imbalanced due to last year’s tariff-driven rush to retail lots. What is the probability of resilience? JD Power reveals its latest outlook.

Total new-vehicle sales, including retail and non-retail transactions, are projected to reach 1,365,200 in April. This equates to a 7.3% decrease year-on-year, according to a forecast from JD Power.

The seasonally-adjusted annualised (SAAR) rate for total new-vehicle sales is expected to be 16 million units. This is down 1.3 million compared with April 2025.

New-vehicle retail sales for April 2026 are projected to reach 1,129,100, a 7.3% decrease from April 2025. The SAAR for retail new-vehicle sales is expected to be 13.6 million units, down 1.1 million units from April 2025.

US year-on-year comparison limited

Despite this solid performance, year-on-year comparisons for total new-car sales present a challenging picture for April.

‘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,’ stated Thomas King, president of OEM Solutions at JD Power.

That pull‑ahead pushed April 2025 to an annualised sales pace of 17.2 million units. This was 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‑on‑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,’ added King.

Affordability pressures prevail in US

Despite some apparent respite, affordability issues continue to constrain the vehicle sales pace in the US. This comes as pricing and financing conditions show modest signs of improvement.

Average retail transaction prices are trending toward $45,990 in April. This is essentially unchanged from a year ago. Meanwhile, the average interest rate on new‑vehicle loans is expected to decline 0.3 percentage points (pp) to 6.73%.

‘Despite easing borrowing costs, average monthly finance payments are expected to increase 3.1% year on year to $812, driven primarily by continued deterioration in trade‑in equity,’ he added.

Recent shifts in the US new-car market are refocusing the financial position of many buyers. Higher loan balances combined with softer vehicle values are subsequently impacting equity positions.

Average trade‑in equity is declining toward $7,099 (€6,075), down $660 from a year ago. Meanwhile, the share of vehicles carrying negative equity looks to reach 31.3%. This is the highest level for the month of April since 2020 and is up by 5.5pp from 25.8% a year ago. Essentially, consumers who purchased during the peak of inventory shortages four years ago are returning to market.

In response to increasing negative equity, manufacturers are increasing incentive support. Average incentive spending per vehicle is trending towards $3,141, an 11.1% increase from a year ago. Incentives as a percentage of manufacturer’s suggested retail price are expected to hit 6.1% in April, up 0.5pp from April 2025.

‘On non‑electric vehicles specifically, average incentive spending per vehicle is trending towards $2,860, a 15.7% increase from a year ago. Incentive spending on electric vehicles (EVs) remains materially higher, on pace to reach $10,018 per unit. That is down 1.7% from last year but still underscores the continued role of discounting in supporting demand for EVs, concluded King.’

Lessee positivity

Total retail consumer expenditure slipped to $49.9 billion in April, down $4 billion from a year earlier. This came as the slower sales pace dragged on overall consumer spending.

On the positive side, the rise in returning lessees represents a welcome tailwind for the industry. During the post-COVID-19 pandemic vehicle supply crunch, many would-be lessees opted to finance or purchase their vehicles outright instead.

This left a drought of returning lessees that echoed for years. Among all new vehicle buyers in April, 23.2% opted to lease, a 1.3pp increase from a year ago. This metric is expected to remain elevated throughout the rest of the year.