Chairman’s Blog: The Darrow Difference
Chinese Automakers are Knocking. Will the U.S. Let Them In?
Chairman Mike Darrow is here with a new blog post. Having achieved access to Mexican and Canadian car buyers and building on their unprecedented takeover of the European market, Chinese automakers are knocking on our door. Will Americans answer? Among dealers, the debate over allowing Chinese automakers into the U.S. market is almost all anyone is talking about. We are uniquely positioned to recognize the threat China poses as it exports its excess capacity around the world. How the U.S. responds next will be deeply consequential, not just for our industry but for our country. As dealers, our stores are the final link in a large and complex industry chain. Every vehicle we sell represents a long line of suppliers, factory workers, engineers, transporters, and local employees whose livelihoods depend on a healthy, balanced industry. Opening the door to Chinese automakers, whether through imports or U.S.-based manufacturing, risks undercutting that entire system. Click here for the full blog post.

Hybrids Now Quickest Turners as New-Vehicle Inventories Dip to 2.85 million
New-vehicle inventories fell to 2.85 million at the start of May as elevated fuel prices drove demand for hybrids and electric vehicles to record levels while supplies of such models dropped, data firm Catalyst IQ said. The latest tally of light-vehicle inventory represented a 2.7 percent decline from the beginning of April but was 1.2 percent higher than the same point a year ago, reports Automotive News. The industrywide 76 days’ supply, calculated using the most recent rate of sales, was down from 80 days the previous month, but up seven days from where it stood a year earlier, the data and analytics firm said.Despite representing about 1-in-5 vehicles marketed for sale, hybrids were both the fastest-turning powertrain type and had the lowest days’ supply, Catalyst IQ said. Hybrids advertised for sale spent an average of 59 days on dealership lots, compared with 75 days for traditional gasoline-powered vehicles and 114 days for EVs, which had supplies of 77 and 79 days. Hybrids had a 67-day supply. Click here for the full story.

Group of 14 California Volkswagen Dealers Pushes Back on Scout Sales Approach
According to the California New Car Dealers Association (CNCDA), 14 California Volkswagen dealers filed protests at the California New Motor Vehicle Board on May 1. The complaint adds further challenges for VW’s Scout Motors subsidiary in its efforts to sell directly to consumers.Dealers contend that VW is competing with its own franchise network, citing claims that Scout is not independent due to shared ownership and production facilities. The complaint alleges that the automaker is trying to circumvent California franchise law. Typically, dealers operate under the rights established by Assembly Bill 473, a California law enacted in 2023, reports CBT News. This law prohibits automakers from competing with franchised dealers and was designed to prevent workarounds similar to the Scout structure. Miles Brandon, President of Capistrano Volkswagen, said: “VW has left us no choice. They are competing against the very dealers who built their business here.” Protests contribute to an ongoing federal lawsuit filed by the CNCDA. The federal court allows the case to proceed to discovery after denying motions to dismiss. Dealers have opened a second legal front to challenge the direct-sales model. Click here for the full story.

New-Vehicle Prices Surge from Impact of Tariffs
New-vehicle prices jumped by $1,315 on average in Q1 2026 when compared to vehicles added to the inventory in the same month in 2025. According to the Cars.com industry insights report, the increase is likely driven by tariffs put in place by the Trump Administration. The report predated President Donald Trump threatening a new round of tariffs on vehicles from the European Union last week, with a 25 percent tariff for allegedly not complying with the trade agreement agreed to last year in Scotland, reports CDG. Though a U.S. Supreme Court decision this year overturned reciprocal tariffs, many of the duties on aluminum, steel, and copper remain in place, along with a 10 percent tariff on goods put in place by the Trump Administration following the court decision. Aaron Bragman, Detroit Bureau Chief at Cars.com, said it is not a surprise to see the cost of the tariffs now being felt in the market. Along with the tariff impact, Cars.com noted the destination fees have continued to increase for domestic brands. Click here for the full story.

How AI Is Changing Car Shopping Satisfaction
Consumers — albeit a small number — who use artificial intelligence tools to buy a vehicle report being more pleased with the outcome than those who don’t use it, according to the Cox Automotive 2025 Car Buyer Journey Study. “While AI usage was relatively modest among all vehicle buyers, those buyers who did engage AI tools reported higher satisfaction, greater trust in dealers, and a faster, easier process,” the Cox study said.The findings — including buyers enjoying real-time answers and personalized recommendations — could signal a shift in how consumers research vehicles and how dealerships respond.The study, released in January, for the first time includes data on customers using AI to buy vehicles, reports Automotive News. Gen Z and millennial shoppers, buyers with children and multicultural buyers lead the shift in AI use, Cox Automotive said. Cox surveyed 2,300 car buyers from Aug 6. through Sept. 5 who purchased a new or used vehicle within the previous 12 months. Click here to view the key survey findings.

Federated Insurance’s Claim of the Month – Stay Aware to Help Prevent Transport Scams 
A customer from the Southwest contacted an East Coast auto dealer to purchase a high-value specialty car from their inventory. After receiving payment, the dealer hired a broker to ship the vehicle across the country. A carrier picked up the car, but it never arrived at the customer’s location. An investigation revealed that criminals had infiltrated the broker’s email and posed as the carrier to steal the car.
CLAIM AMOUNT: $175,000Risk Management Tips to Consider:  
• Research and Review Vendors: Verify that brokers and carriers register with the Department of Transportation (DOT) and hold a valid Motor Carrier (MC) number. Check reputable sources, such as the Better Business Bureau, to spot a history of negligent or dishonest practices.
• Watch for Fraud Indicators: Scammers often price fake services below market rates to lure victims. Avoid deals that seem too good to be true. Evaluate the professionalism of all communications, and flag any emails that contradict what you discussed over the phone.
• Validate Delivery Details at Pickup: When a driver arrives, call the broker to verify the driver and MC number. Question last-minute carrier changes, especially if notified only by email. Ask the driver to confirm transport details, like the customer’s name. Avoid carriers missing properly posted DOT or MC numbers on their trucks.
• Act Quickly to Help Prevent Scams: Report suspected crimes to authorities immediately. Save all documentation, including emails, pickup surveillance video, receipts, and contracts.

Around the Web

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AAA Finds EV Range Drops 39% in Cold Weather and Costs Jump [Autoblog]

How Jason Graciano Turned White Plains Honda’s Lease Returns, Service Drive into a CPO Machine[CDG] 

2026 Bentley Continental GT S Slices the Pie Even Thinner [Car and Driver]