Auto Industry Takes $12 Billion Hit from Trade War
President Trump’s tariff war has inflicted almost $12 billion of losses on global automakers, the biggest hit they have faced since the pandemic. The scary reality: This may be just the beginning. Beyond the continuing cost of tariffs, automakers in the U.S., Japan, South Korea and Europe face years of retooling and supply-chain tweaks to adjust to the new realities, reports The Wall Street Journal. This comes after they spent heavily to reshape factories for electric vehicles.The obvious responses to tariffs are to raise prices and move production to the U.S. But both are hard for carmakers to do quickly, potentially saddling them for years to come.Skeptics say the tariffs will only change the industry at the margins, with global automakers investing in the U.S. because of its healthy consumer economy, not its politics.Still, White House trade policy may be accelerating an industry trend toward making cars closer to where they are sold. The big auto markets of North America, Europe and China are increasingly divided by different regulations, technologies and consumer preferences, encouraging automakers to design and manufacture locally. Click here for the full story.
Auto Loan Market Expands, But So Do Late Payments
Economists are keeping an eye on what’s getting to be a sizeable uptick in auto loan delinquencies, especially among younger borrowers and borrowers with subprime credit scores, according to the Quarterly Report on Household Debt and Credit from the Federal Reserve Bank of New York for the second quarter of 2025. “Look at younger people. Segments of our population are having some difficulties,” says one of the authors of the Household Credit report, in a conference call. “If you look at delinquency rates (for), cars and credit cards, they’re pretty elevated.” The findings mirror those from TransUnion recently reported in WardsAuto. Overall, demand for auto loans and leases was strong in the second quarter, with the biggest growth in the highest credit-score category, with scores of 760 or higher, the New York Fed reports. Total originations for new- and used-car loans and leases in the second quarter were $187.9 billion, up 4.9 percent year-over-year, the New York Fed says. The 760-plus category accounted for $75.1 billion in originations, up 14.5 percent vs. a year ago. That represented a 40 percent share of auto originations in the second quarter, vs. 36.6 percent a year ago. Share of originations decreased for all other credit-score categories. Click here for the full story.
GM, Hyundai to Develop Vehicles Together Including Electric Van for U.S.
General Motors and Hyundai Motor plan to develop five vehicles together including an electric van as they seek to lower costs amid growing competition from nimble Chinese rivals. The automakers will develop four vehicles for central and South American markets, including a compact SUV, a sedan and two pickups, all with the flexibility to use either an internal combustion engine or a hybrid system, the companies said in a statement Aug. 7.Design and engineering work is underway on the new vehicles for the central and South American markets, which will launch in 2028, the companies said. The electric commercial van will be manufactured in the U.S. as early as 2028, reports Automotive News.GM will steer the development of the midsize truck platform, while Hyundai will lead the compact vehicle and electric van.The automakers did not say where the models would be produced, but said they expected to be rolling out at least 800,000 vehicles a year at full production.The partnership is Hyundai’s first with another automaker for a large-scale project, paving the way for both sides to pool resources for more efficient capital spending and manufacturing operations in markets around the world. Click here for the full story.
Kevin Pitts Breaks Down BMW of Reading’s Strategy to Stay Ahead
As EV incentives shift and market conditions fluctuate, dealers are adjusting their strategies to stay competitive. In today’s episode of CBT New’s Inside Automotive, Kevin Pitts, general manager of BMW of Reading, part of the Tom Masano Auto Group, shares how his team is staying ahead of the curve. In addition to Pitt’s BMW store, the Tom Masano Auto Group also owns a Mercedes-Benz and Ford location. June brought mixed results for BMW of Reading— fixed ops performed well, but used-vehicle sales proved challenging. New-vehicle sales volume, particularly at BMW, remained strong. With the federal EV tax incentive set to expire at the end of September, manufacturers are ramping up offers to move electric inventory. Pitts commends both BMW and Mercedes-Benz for rolling out strong incentives to get EVs off the lot. Ford is also seeing strong traction, thanks in part to its “Zero, Zero, Zero” promotion: zero down, zero interest and zero payments for a limited time. Historically, EV adoption in Pennsylvania has been slow. The region’s smaller size and limited infrastructure have made consumers hesitant to go electric. Click here for the full story.
New-Vehicle Inventory Flat at 2.69 million as EVs Start to Move
New-vehicle inventory in the U.S. was largely flat in July, despite a sharp decline in the days’ supply of electric vehicles ahead of the expiration of federal incentives at the end of September. Inventory rose slightly from 2.65 million a month earlier to 2.69 million vehicles to start August, according to Lotlinx, which estimated supply ticked down to 63 days from 65 days the previous month.A year earlier, new-vehicle inventory stood at 2.77 million, representing a 64-day supply, reports Automotive News.Broken down by powertrain, the inventory management firm said hybrid vehicles were in the shortest supply nationwide at 55 days, while the combustion-powered vehicle supply was 64 days — largely flat from the previous month.EV supply dropped sharply, however, from 99 days the previous month to 73 days, Lotlinx said, as automakers and dealers work to clear inventory before federal subsidies expire.By segment, sedan inventory was 57 days, SUVs were at 61 days, pickups were at 72 days and crossovers stood at 77 days, Lotlinx said. Click here for the full story.
ComplyAuto Announces Leadership Update – Brad Miller Joins Founder Chris Cleveland as Co-CEO
American history, is excited to announce that Brad Miller, ComplyAuto’s Chief Legal Officer, has been appointed Co-CEO, joining founder Chris Cleveland. Miller retains his title as Chief Legal Officer, and Cleveland assumes the additional role of Chief Product Officer. ComplyAuto, the leader in dealership compliance and AI-driven efficiency software, has become the dominant industry leader with over 10,000 dealership customers in the span of just a few years. This update will allow ComplyAuto to accelerate to the next level of growth as a company. “This realignment is terrific news for ComplyAuto and our customers,” Miller said. “What ComplyAuto has accomplished in such a short time is simply remarkable, and much of that can be attributed to Chris and his tremendous leadership. Chris is not going anywhere, but we are improving our structure to effectively manage our tremendous growth, while ensuring that Chris and his team can focus even more of their time in developing new, groundbreaking products for dealers like Guardian and DealCheck Ai.” “Brad is a trusted industry leader and true dealer advocate, and he has been the perfect addition to ComplyAuto. We share the same vision for ComplyAuto and for making dealers more efficient and compliant.” Cleveland said. “I’m going to be as involved as ever in ComplyAuto, but Brad’s leadership will allow me to focus on improving our current products and continue developing a number of future developments that are in our pipeline.”
Around the Web
Toyota Motor Profit Drops, Sees $9.5 Billion Tariff Hit [The Wall Street Journal]
2025 Mercedes-AMG G63 Tested: Still the One [Car and Driver]