State of the Automotive Industry – May 2025

The auto industry in May 2025 is being shaped by protectionist policies, EV competition, and tech disruption:

U.S. Tariffs: A 25% tariff on imported vehicles has raised new car prices by over $4,700. Buyers are turning to used cars, while OEMs like GM are investing in U.S. production to offset import costs.

European Strain: German automakers face declining demand and stiff EV competition from China. The EU has responded with tariffs on Chinese EVs to protect its manufacturers.

China’s EV Dominance: BYD and other Chinese brands are leading the global EV market, fueled by strong domestic supply chains and rapid tech development.

EV Policy Divergence: Norway leads in EV adoption (~90% of new sales), while the UK is softening its zero-emission targets, risking climate setbacks.

Tech Innovation: Driverless vehicle pilots and generative AI in vehicle software are picking up pace, with startups and traditional OEMs alike investing heavily.

Sales Outlook: U.S. new vehicle sales are up slightly, but expected to slow post-tariff surge. Production is increasing domestically to meet shifting demand.

Why a Custom Loyalty/Retention Program Matters Now, More Than ever!

We know that in today’s uncertain markets, which include price hikes, changing inventory, and confused buyers, having a custom loyalty/retention program designed for your primary market area is crucial to long-term profitability. Dealership for Life can assist you in creating the right program that will appeal to your customers. This action will allow you to create customers that return to your business for service, parts, accessories and ultimately to purchase from your inventory again and again.

Contact Dealership for Life and get started building your custom loyalty/retention program that gives you the results you desire. Remember, increased customer retention=greater profitability!