Ford: First-Quarter Sales May Be as Good as It Gets in 2025

First-quarter US auto sales to consumers and fleet customers rose 4.8% year over year, and March grew 10.7% (15% adjusting for selling days) with a seasonally adjusted annualized selling rate of 17.77 million, the best SAAR since April 2021. We think consumers pulled sales forward into March due to tariffs that start in April. We expect tariffs to really hurt sales starting around May or June once tariff-free inventory depletes from dealer lots. There are as many as four possible tariffs hitting US auto imports in April. Assuming the 25% tariffs on Canada and Mexico in response to fentanyl and illegal immigration start April 2, even for US-Mexico-Canada Agreement-compliant vehicles, plus 25% April 3 tariffs and the normal 2.5% US tariff on foreign autos, many vehicles will have at least a 52.5% tariff on them unless President Donald Trump enacts exemptions. We don’t see a scenario where consumers avoid paying at least some of these tariffs, so we lower our 2025 US light-vehicle sales forecast range to a midpoint of 15.5 million from 16.3 million.