The U.S. auto market lost momentum in March and throughout the first quarter, as a combination of affordability concerns, supply constraints, and difficult year-over-year comparisons weighed on sales across much of the industry. The drop was somewhat expected. In the first quarter of 2025, we saw a surge from new car buyers who were fearful of what the incoming tariffs would do to prices.
New-vehicle sales in March fell 14% to 1.39 million units, according to GlobalData. Retail demand dropped sharply, down 16%, while fleet sales slipped 2.3%. The seasonally adjusted annual rate (SAAR) came in at 16.2 million units—slightly above expectations but well below the 17.9 million pace seen in March of last year. It was, however, an improvement from February’s 15.7 million rate.
For the quarter, Cox Automotive estimated an annualized selling pace of about 15.5 million units, down from the 16 million-plus level the industry achieved in both 2024 and 2025.
A wide range of automakers reported declines, including General Motors, Toyota Motor Corporation, Ford Motor Company, Honda Motor Company, Nissan Motor Company, Subaru Corporation and BMW Group. Much of the weakness reflects comparisons to an unusually strong March 2025, when buyers rushed to purchase vehicles ahead of anticipated U.S. tariffs. Harsh winter weather and continued pressure from high vehicle prices, elevated borrowing costs, and rising gasoline prices also dampened demand.
Ford Motor Company
At Ford Motor Company, March sales declined 14%, with both the Ford and Lincoln brands posting double-digit drops. First-quarter sales fell 8.7%, including a 9.1% decline at Ford and a slight dip at Lincoln. Sales of the F-Series pickup, Ford’s top-selling model, dropped 16%, in part due to tight inventory following a September fire at aluminum supplier Novelis. The company expects recovery from that disruption to remain uneven, with stronger improvement later in the year. Ford also felt the impact of product changes, including the discontinuation of the Escape, which saw sales plunge 67%, while Lincoln Corsair sales declined 14%. The Bronco Sport provided a bright spot, setting a first-quarter sales record of 35,021 units, up 5%, with entry-level trims gaining 10%.
General Motors
At General Motors, first-quarter deliveries fell 9.6%, marking a second consecutive quarterly decline. Chevrolet volume dropped 7.9%, GMC slipped 0.2%, Buick fell 33%, and Cadillac declined 26%. Despite the downturn, the company is entering the spring selling season with a broad lineup spanning entry-level SUVs to premium trucks.
Toyota Motor Corporation
Toyota Motor Corporation reported an 8.5% drop in March sales, including a 6.9% decline at the Toyota division and a 17% drop at Lexus. For the quarter, overall U.S. sales were essentially flat, slipping just 0.1%, as modest gains at Toyota offset weaker Lexus results. Inventory remains among the tightest in the industry, complicated by the launch of a redesigned RAV4, the brand’s top-selling vehicle, which is expected to constrain supply for several months. Toyota also faced a stop-sale order on the Prius hybrid due to a safety recall.
Honda Motor Company
Honda Motor Company posted a 12% decline in March sales, with first-quarter volume down 4.2%, marking its third consecutive quarterly decrease. Key models including the CR-V, HR-V, and Civic all posted lower sales. However, the company’s hybrid lineup performed strongly, setting a first-quarter record of 95,882 units. Hybrid versions of the CR-V and Accord accounted for more than half of each model’s sales, and the Civic hybrid also reached a quarterly record.
Stellantis
Stellantis was a notable exception to the broader trend, posting a 4.1% increase in first-quarter U.S. sales, its third consecutive quarterly gain. Jeep sales rose 2.8% and Ram jumped 20%, while Dodge posted a modest 4.3% increase. However, several smaller brands within the portfolio saw steep declines, including Chrysler, down 28%, Fiat, down 70%, and Alfa Romeo, down 53%.
Nissan Motor Company
At Nissan Motor Company, first-quarter sales dropped 7.5%, with the Nissan brand down 7.7% and Infiniti off 3.2%. The company attributed the decline in part to a strategic reduction in lower-margin fleet sales in favor of more profitable retail business.
Hyundai Motor Company/Kia Corporation
Hyundai Motor Company and Kia Corporation both reported lower March sales, down 3.4% and 2.6%, respectively, compared to a year earlier. Despite that, both brands achieved record first-quarter results. Hyundai’s U.S. sales rose 1% to 205,388 units, while Kia climbed 4.1% to 207,015 units, marking record quarterly totals for both.
Electrification trends remained mixed. While EV demand softened following the expiration of federal incentives, hybrid sales surged. Hyundai reported record hybrid deliveries in March, driven by strong gains in the Sonata, Elantra, and Santa Fe. Kia reported hybrid sales up 73% in the first quarter, with total electrified vehicle sales increasing 30%. Kia has now posted six consecutive quarters of U.S. sales growth.
Subaru Corporation
Subaru Corporation continued to struggle, with March sales down 24% and first-quarter deliveries off 15%, marking eight straight months of declines. Mazda Motor Corporation also extended its downturn, with U.S. sales falling for the eighth consecutive month and fourth straight quarter. March volume dropped 26%, as weaker light-truck sales offset gains in passenger cars.
Other Brands
Among smaller brands, first-quarter sales fell 10% at Mini and 15% at Mitsubishi. In the luxury segment, BMW Group reported a 3.9% decline, its second consecutive quarterly drop. In contrast, Genesis continued its growth streak, with March sales rising 4.3% to 7,417 units, helped by a 32% increase in GV70 deliveries. First-quarter sales at Genesis reached a record 18,317 units, up 4.6%.
March Incentives
Automakers ramped up incentives in March in an effort to offset high interest rates and affordability challenges. Many brands offered 0% financing and deferred payment options, while others increased direct discounts. Toyota offered up to $5,000 off select 2025 Tundra models, while GMC promoted discounts of up to 20% on certain 2026 Sierra 1500 pickups. Hyundai and Kia combined zero-percent financing with delayed initial payments on select vehicles.
According to J.D. Power and GlobalData, average manufacturer incentives rose by $165 year over year to $3,325 per vehicle in March. Discounts on EVs remained significantly higher, averaging $11,258, though that figure was down $940 from a year earlier. Incentives on non-EVs averaged $3,030, an increase of $353.
Inventory Levels
Inventory levels continued to recover, reaching nearly 2.9 million units in March, according to Cox Automotive. The industry ended the quarter with roughly a 130-day supply of EVs, reflecting slower demand in that segment. Brands with the highest inventory levels included Chrysler, Lincoln, Mini, Jeep, Ram, Buick, Genesis and Volkswagen, while Toyota, Lexus, Honda, Infiniti, Audi and Chevrolet maintained the leanest stockpiles.
As the industry heads into the critical spring selling season, the balance between supply, pricing, and consumer confidence will determine whether the market regains momentum—or continues to idle in a lower gear. The one thing that looks certain is to rebound in Q2, the automakers are going to have to ratchet the incentives even higher.
Note: At the time of our deadline, the following automakers had still not reported sales: Volkswagen, Audi, Volvo, Land Rover, Porsche, Jaguar, and Mercedes-Benz. We will update numbers as the stragglers report.
Here are your winners & losers for the first quarter of 2026 as tallied against the first quarter of 2025, and the percentage up or down:
| Manufacturer | Q1 2026 | vs Q1 2025 |
1. Toyota |
488,468 |
0.3% |
2. Ford |
431,374 |
9.1% |
3. Chevrolet |
405,617 |
7.9% |
4. Honda |
304,478 |
5.1% |
5. Nissan |
234,318 |
7.7% |
6. Kia |
207,015 |
4.1% |
7. Hyundai |
205,388 |
0.9% |
8. GMC |
145,930 |
.2% |
9. Jeep |
144,532 |
2.8% |
10. Subaru |
141,944 |
15% |
11. Ram |
112,160 |
20.1% |
12. Tesla (EV) |
110,000 |
15.4% |
13. Mazda |
94,473 |
14.4% |
14. BMW |
84,231 |
3.9% |
15. Lexus |
80,952 |
2.5% |
16. Buick |
41,654 |
32.6% |
17. Acura |
32,352 |
5.2% |
18. Cadillac |
31,098 |
25.5% |
19. Mitsubishi |
26,881 |
15% |
20. Chrysler |
25,423 |
27.5% |
21. Lincoln |
23,731 |
.5% |
22. Dodge |
22,674 |
4.3% |
23. Genesis |
18,317 |
4.6% |
24.Infiniti |
12,750 |
3.2% |
25. Rivian (V) |
8,000 |
12.1% |
26. Mini |
6,261 |
10.2% |
27. Lucid (EV) |
3,900 |
62.5% |
28. Polestar (EV) |
1,350* |
18.2 % |
29. Ineos |
1,300* |
7.1% |
30. Alfa Romeo |
919 |
52.9% |
31. Lamborghini |
720* |
4% |
32. Bentley |
645 |
19.4% |
33. Maserati |
600* |
45.5% |
34. Rolls-Royce |
460* |
2.2% |
35. VinFast (EV) |
300* |
42.9% |
36. McLaren |
225* |
25% |
37. Fisker (EV) |
150* |
40% |
38. Fiat |
139 |
73.4% |
*Estimated sales reported by the automaker, which I put no stock in.
Photo Credit: Andy Dean Photography/Shutterstock.com