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3 real-time shifts in car buying behavior post tariff announcements

3 real-time shifts in car buying behavior post tariff announcements

CDG's latest data drop is here...

Anna del Villar & Car Dealership Guy
May 01, 2025

Hey, everyone — PSA!

Our Auto Tariff Tracker is still live—and if you haven’t circled back lately, it’s worth another look.

It’s where we’re tracking real-time OEM guidance. Plus, what it all means for dealers on the ground—inventory, pricing, strategy, and more.

Bookmark it. Refresh often. Stay sharp.

—CDG

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Welcome to The Breakdown, an analysis of auto retail’s top trends, moves, and insights—in under 5 minutes.

Last week, we ran our very first CDG Consumer Snapshot Survey to get a pulse on how car buyers are responding to the recent auto tariff announcements.

At first glance, the results felt a bit all over the place. Some consumers are pausing, others are accelerating, but most seem like they’re just trying to make sense of it all.

And after digging deeper, three consumer behaviors stood out that all point in the same direction…

Behavior #1: Consumer interest in buying a car has dropped because of tariff concerns.

Tariffs are stirring up the car market, and dealership customers are feeling it (at least psychologically).

42.1% of consumers from our survey say they’re now somewhat or much less likely to buy a car, compared to 38.8% who say their plans haven’t changed.

CDG Consumer Snapshot Survey: Tariff Edition

What pushed the scale? Momentum.

According to J.D. Power, new vehicle sales in April are forecasted to rise 10.5% YoY, driven by 139,000 accelerated purchases from buyers trying to lock in pricing.

But that urgency faded fast.

The sales pace in the first week ran 28% higher than seasonal norms. But by week three, it cooled significantly—almost in sync with OEMs publicly guaranteeing price stability into the summer months.

Still, even with prices temporarily “flat,” shoppers started making quieter moves.

19.2% said they’re changing to smaller or less expensive vehicles—downshifting from SUVs and trucks to compact cars or crossovers.
And 27.4% said they’re now more likely to buy used.

For these buyers, it’s about insulation. Smaller and used vehicles are viewed as safer bets in a market they no longer fully trust. And they’re preparing for volatility, even if it hasn’t shown up yet.

What we’re hearing from dealers:

The summer pricing window is becoming a short-term sales lever.
They’re prioritizing used, compact, and CPO inventory while pulling back on high-priced SUVs and imports that carry more tariff risk.
Negotiations are picking up. Buyers might feel some urgency, but they’re holding out for deals that are future-proof.

Adapting to market volatility is no longer optional for dealerships; it’s essential.

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Behavior #2: Consumers plan on holding onto their trade-ins for longer.

Consumers aren’t dumb. They know exactly what happens when tariffs hit the new car market…

81.7% of buyers told us they expect used car prices to rise. Not “eventually” but soon. In fact, it’s one of the strongest signals in the entire survey. And they’re not wrong.

According to Carfax, used car prices were already moving up MoM in April:

Pickup Trucks: +$660
Luxury SUVs: +$600
Hybrids and EVs: +$250
Minivans and luxury sedans: +$160

But here’s where it gets interesting: 41.1% of consumers say they’re less likely to trade in their vehicle right now.

CDG Consumer Snapshot Survey: Tariff Edition

On top of that—61.7% of buyers said they feel less confident in their ability to afford a vehicle than they did in January. So even if they wanted to trade in, many don’t feel like they can replace what they already have without stretching their budgets.

What we’re hearing from dealers:

Solely relying on steady lease returns or casual trade-ins is a losing bet.
They’re expect trade volumes to drop further and auction pressure to build.
So, many retailers are ramping up their efforts to source inventory off the street.
But most are throwing their full weight behind fixed-operations (service, parts, collision).

Behavior #3: Consumer confidence is cracking—and it’s reshaping deal structures.

80.5% of consumers in our survey say they feel more cautious about the car market than they did earlier this year. Meanwhile—just 4.8% feel more optimistic.

Whoa.

CDG Consumer Snapshot Survey: Tariff Edition

And now, that mindset is bleeding into how deals get built.

Some consumers are switching to cash (13.1%) to avoid risk. Others are looking at leases (10.7%) as a hedge against depreciation. Sure, the behavior is defensive, but it’s rational.

These are buyers who watched friends—or themselves—get stuck in upside-down loans at the peak of 2021 and 2022.

They’re not making that mistake twice.

The name of the game is avoiding exposure, structurally as much as financially.

And the national data backs it up. The University of Michigan’s Index of Consumer Sentiment dropped 8% MoM in April. Since January, it’s down nearly 38%—the sharpest three-month decline since the 1990 recession.

What we’re hearing from dealers:

Embracing price transparency, no-surprise fees, and simple messaging are vital.
Many are shifting the sales narrative from “best deal” to “least risk.”
Operators are watching for brand and segment sensitivity. High-depreciation or import-heavy models might need more support than usual.

Big picture: Car buyers are thinking more about how they engage with the market, not just when.

The dealers who adapt fastest to the new posture (more protective, less reactive) will pull ahead. But I have a feeling the next 90 days will expose exactly who’s built to sell into uncertainty—and who isn’t.

What did you think of these results? Hit Reply and let me know.