Status note: This is a preliminary year-to-date (YTD) report covering January through May 2026. The first half of 2026 is not yet complete (June data does not exist as of June 6, 2026), and several figures cited are preliminary forecasts or estimates that automakers and data providers routinely revise. Where sources disagree, it is noted. All figures are sourced inline.
Overview and Headline Volume
The U.S. new-vehicle market entered 2026 on a softer footing than a year earlier, but the underlying picture is more nuanced than the raw year-over-year (YoY) numbers suggest. On a seasonally adjusted annualized rate (SAAR) basis, the U.S. Bureau of Economic Analysis, via FRED, reported total vehicle sales of 14.987 million in January, 15.881 million in February, 16.537 million in March, 16.395 million in April, and 16.485 million in May 2026. After a weak January, the pace stabilized in the 16.4-16.5 million range through the spring, broadly consistent with the roughly 16.3-million full-year pace the industry ran in 2025.
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In actual (not seasonally adjusted) unit terms, BEA/FRED light-vehicle sales for January through May 2026 totaled approximately 6.49 million units, down from about 6.84 million in the same period of 2025 – a decline of roughly 5%. However, this YoY comparison is heavily distorted by events in early 2025, and reading it as a genuine 5% demand contraction would be a mistake, for reasons explained below.
The Tariff Pull-Ahead and Payback Distortion
The single most important thing to understand about the January-May 2026 numbers is that they are being compared against an artificially inflated 2025 baseline. According to JD Power, in the spring of 2025 consumers rushed to dealerships to buy ahead of anticipated tariff-driven price increases. JD Power estimated that roughly 53,000 extra sales were pulled forward into April 2025 alone, pushing that month to a 17.2-million annualized pace – one of 2025’s strongest months. By May 2025, that pull-ahead had reversed into payback, with an estimated 63,000 sales pulled out of May into the earlier months.
The practical effect is that 2026’s YoY comparisons swing month to month based on what the 2025 comparison month looked like. The JD Power and GlobalData monthly forecasts illustrate this clearly: March 2026 was projected at 1,372,877 units (down 11.4% YoY), April 2026 at 1,365,200 units (down 7.3% YoY), but May 2026 at 1,490,900 units – up 5.8% YoY, which JD Power described as the first positive retail comparison since September 2025. JD Power’s Thomas King characterized underlying demand as resilient.
A note on source variation: for May 2026, JD Power projected total sales up 5.8% YoY, while MarkLines’ preliminary tally (as of June 3) put May down 0.8% YoY. These differences reflect timing, methodology, and the inclusion or exclusion of certain vehicle categories, and are typical of preliminary monthly data before final reconciliation.
Pricing, Incentives, and Affordability
Affordability remained the defining constraint on the market. JD Power reported that the average new-vehicle transaction price was essentially flat year-over-year – trending toward about $45,990 in April and roughly $46,023 in May 2026 (the latter down 0.2% YoY). Prices holding flat is itself notable given the tariff environment, and was achieved partly through a sharp increase in manufacturer discounting.
Average incentive spending climbed materially. JD Power put April incentives at about $3,141 per vehicle (up 11.1% YoY) and May at roughly $3,297 (up 20.7% YoY), or about 6.4% of MSRP. Part of that jump reflects lapping unusually low incentives in spring 2025, when manufacturers pulled back discounts to offset tariff costs. Electric-vehicle incentives stood out dramatically, reaching about $10,308 per unit in May versus roughly $2,973 for non-EVs.
Financing conditions eased modestly but did not resolve the affordability squeeze. The average new-vehicle loan interest rate fell to about 6.73% in April and 6.59% in May 2026 (per JD Power), called the lowest May reading in two years. This is consistent with the longer-run downtrend in the Federal Reserve’s commercial-bank 48-month new-car loan series, which eased to 7.36% by February 2026 from 7.71% a year earlier (BEA/FRED). Despite cheaper borrowing, the average monthly finance payment still rose to a record of about $812 in April and around $810 in May (up roughly 2.8-3.1% YoY). JD Power attributed this to deteriorating trade-in equity: the share of trade-ins carrying negative equity climbed to about 31.3% in April and 30.4% in May. Consumers leaned on longer loans (13.4% of loans at 84+ months in May) and leasing (penetration around 22.6-23.2%) to manage monthly payments.
Powertrain Mix: Hybrids Up, EVs Softening
The powertrain story in early 2026 was a continued hybrid surge alongside a softening EV share. JD Power reported that hybrid share of retail sales rose to about 16.3% in May (up 1.6 percentage points YoY), driven by elevated fuel prices and broader hybrid availability. Meanwhile EV retail share eased to about 7.0%, which JD Power explicitly attributed to the elimination of federal EV tax credits – a significant policy shift that helps explain both the lower EV volume and the very heavy EV discounting noted above. MarkLines similarly flagged high gas prices and rising electrified-vehicle demand as defining May.
Brand and Manufacturer Performance (Q1 2026)
The most reliable brand-level view for the period is the first quarter, because several large manufacturers (General Motors, Ford, and Stellantis) report U.S. sales only quarterly – which means month-by-month brand totals for April and May are incomplete and understate the market. According to GoodCarBadCar’s Q1 2026 figures, the largest-volume brands were Toyota (488,466, essentially flat YoY), Ford (431,474, down from 474,749), Chevrolet (406,887, down from 442,300), Honda (304,478, down from 320,811), Nissan (234,318, down from 248,374), Kia (207,465, up from 198,850), and Hyundai (205,388, up modestly).
Several notable movements stand out: Mercedes-Benz rebounded sharply (about 75,492 versus 50,067 a year earlier), Ram rose (about 112,160 versus 94,368), and Porsche gained, while Tesla declined (about 110,000 versus 130,000), as did Subaru, Mazda, Audi, Buick, Cadillac, and Mitsubishi. These brand figures are useful for direction and ranking but should be treated as preliminary, as GoodCarBadCar notes that quarterly-reporting brands are not finalized until quarter-end and past data may be revised.
| Brand | Q1 2026 | Q1 2025 | YoY Change |
|---|---|---|---|
| Toyota | 488,466 | 487,225 | +0.3% |
| Ford | 431,474 | 474,749 | -9.1% |
| Chevrolet | 406,887 | 442,300 | -8.0% |
| Honda | 304,478 | 320,811 | -5.1% |
| Nissan | 234,318 | 248,374 | -5.7% |
| Kia | 207,465 | 198,850 | +4.3% |
| Hyundai | 205,388 | 203,554 | +0.9% |
| GMC | 145,930 | 146,221 | -0.2% |
| Jeep | 144,532 | 140,584 | +2.8% |
| Subaru | 141,944 | 166,957 | -15.0% |
| Ram | 112,160 | 94,368 | +18.9% |
| Tesla | 110,000 | 130,000 | -15.4% |
| BMW | 83,931 | 89,555 | -6.3% |
| Lexus | 80,952 | 83,043 | -2.5% |
| Mercedes-Benz | 75,492 | 50,067 | +50.8% |
| Volkswagen | 73,803 | 87,914 | -16.1% |
| Mazda | 94,472 | 110,316 | -14.4% |
| Buick | 41,654 | 61,823 | -32.6% |
| Cadillac | 31,098 | 42,056 | -26.1% |
| Audi | 29,921 | 42,711 | -29.9% |
Economic and Policy Context
Three forces shaped the January-May 2026 market. First, the tariff environment of 2025 continued to cast a long shadow, distorting comparisons and contributing to the elevated incentive and pricing dynamics. Second, the elimination of federal EV tax credits reshaped the powertrain mix, pushing EV share down and forcing very large EV discounts. Third, affordability pressure – record monthly payments, widespread negative equity, and reliance on long loan terms and leasing – remained the central brake on volume even as interest rates eased. On the global backdrop, GlobalData trimmed its 2026 worldwide light-vehicle forecast to roughly 91.1 million units (a projected 1.1% YoY decline), citing weakness in China and downstream effects of the ongoing Middle East conflict on energy prices and consumer confidence.
Bottom Line and Data Caveats
Through five months, the U.S. new-vehicle market in 2026 was running at a roughly 16.4-16.5 million annualized pace – soft versus the tariff-inflated early-2025 comparison, but fundamentally stable and showing genuine resilience once the distortion is removed, with May posting the first positive retail YoY comparison since September 2025. The market’s defining tension was healthy underlying demand colliding with a record affordability ceiling, papered over by rising incentives and easing rates.
Important caveats on accuracy: the official Cox Automotive/Kelley Blue Book current monthly average-transaction-price release could not be accessed directly, so the ATP, incentive, and financing figures rely primarily on JD Power-GlobalData, a strong independent source that uses forecasts/estimates issued before final monthly close. The total-volume and SAAR figures are anchored to BEA data via FRED, which is authoritative but subject to revision. Brand-level detail beyond Q1 is incomplete because of quarterly reporting by GM, Ford, and Stellantis. Several monthly figures are preliminary and may be revised in subsequent releases.
Primary sources: U.S. Bureau of Economic Analysis via FRED (TOTALSA, LTOTALNSA, TERMCBAUTO48NS series); JD Power-GlobalData U.S. light-vehicle sales forecasts for April and May 2026 (jdpower.com); MarkLines U.S. monthly flash sales (marklines.com); GoodCarBadCar U.S. brand sales data (goodcarbadcar.net).