The tariff-driven buying surge is cooling… but consumer spending on new vehicles just hit a record.

J.D. Power’s May forecast reveals a complex but opportunity-rich environment for dealership groups and service providers:

Key Highlights:

• New vehicle sales up 1% YoY to 1.2M units
• Average transaction price: $45,462 — 91% of MSRP
• Average monthly payment: $748 — a record for May
• Total consumer spend: $54B — also a record
• Dealer profit per unit: $2,502 — normalizing but still strong

What’s driving it?

Consumers rushed spring purchases to beat potential tariff-driven price hikes. While that urgency is fading, the underlying economics remain solid—even as pricing actions are now expected to shake out late in the year.

J.D. Power projects tariffs could inflate automaker costs by $4,275 per vehicle—a looming margin challenge for OEMs and possibly a margin opportunity for agile players in the retail and service ecosystems.

What this means for business owners:

• Normalizing profits could signal peak timing for a sale
• Inflationary pressure may shift the M&A equation later in the year
• Strategic buyers are still active—especially for businesses with pricing power or recurring revenue

At Colonnade Advisors, we help entrepreneurs make data-driven decisions about timing and value. If you’re watching the market and wondering “is now the right time to explore a sale?” — we should talk.