Cox Forecasts Slowing Vehicle Sales, Higher Prices In 2025’s 2nd Half
Ford trucks are seen at a car dealership in Montebello, California on May 5, 2025. (Photo by … More
New vehicle deliveries will slow in the year’s second half amid higher prices spurred by the tariff-related costs, Cox Automotive said Wednesday in a webinar.
The current April-June period “will turn out to be a relatively strong quarter,” Jonathan Smoke, Cox’s chief economist, said during the presentation. “We now face slowing demand.”
Consumers went to dealers to buy cars and trucks made before tariffs were implemented by the Trump administration.
That “surge is now in the rearview mirror,” said Charlie Chesbrough, Cox’s senior economist.
Cox said the seasonally adjusted annual rate (SAAR) for vehicle sales will probably be 15.3 million for June, down from 15.6 million in May and a rate of 17.5 million in March and April. Cox said in a statement that second-quarter deliveries will be 1.7% higher compared with a year earlier.
The Trump administration has levied tariffs on imported vehicles as well as steel and aluminum. Tariffs are paid by companies that import goods. Those costs typically are passed on to customers. Tariffs are not payments from one country to another.
“We don’t think consumers can absorb it all,” Smoke said of tariff costs.
Cox forecasts U.S. 2025 new vehicle sales of 15.6 million to 16.3 million. The company originally projected 2025 sales would total 16.3 million.
In addition to tariffs, consumers are dealing with continuing high interest rates for vehicle purchases. Federal Reserve Chair Jerome Powell has held interest rates steady despite criticism from President Donald Trump.
“The new vehicle market is likely to see the return of inflation,” Chesbrough said.
Also in the presentation, Cox said the picture for electric vehicles is mixed. A $7,500 tax credit for EVs may end. But EV offerings are expanding.
Smoke said the rest of 2025 will see “a rollercoaster ride for EVs.”