Automakers face strategic reckoning, UAW Pres. shows support for tariffs, EV market grows slightly in March

Hey everyone. Yesterday, FM Capital closed its Fund IV, raising $240 million to back transformative tech in the automotive space.

This is a massive boost for innovation in auto retail—think AI, SaaS, autonomy, and fleet management.

And the funds were backed by a pool of dealers, distributors, OEMs, suppliers, and industry heavyweights. Safe to say that more investment is coming…

Exciting times ahead. Stay tuned.

— CDG

Dealership buyers could weather a multi-year profit dip—and still come out ahead:

As tariffs ripple through the auto industry—some dealers are bracing for a steep decline in profitability.

But even if profits drop by 20% over the next three years...

The long-term returns don't change substantially.

Over 10 years—a dealership buyer would still see a 14.5% internal rate of return compared to 16.2% in a pre-tariff environment.

Bottom line: Short-term uncertainty doesn’t mean the long-term economics won't pencil out.

(Data source: Haig Partners)

But Tim points out that profits and returns aren’t the only thing at risk…

President Trump’s U.S. auto tariffs remain in play—but what this means for the broader industry remains largely unknown.

For context: A 25% tariff on all imported vehicles (in effect since April 3) could raise prices by $5,000 to $10,000—potentially affecting both consumers and sales, per a Telemetry forecast.

And while price hikes are top of mind, the bigger concern is that the market is heading toward a supply crisis—with some OEMs halting production at some plants into the summer.

The potential fallout?

A sharp decline in U.S. sales by as much as 1.8 million units this year.

Looking ahead: Automakers are weighing their options, but there’s no easy fix…

(Go deeper: 4 min. read)

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UAW President Shawn Fain is doubling down on his support for auto tariffs—insisting they’re necessary to revive U.S. manufacturing.

According to Fain:

Fain does not support the global tariffs announced last Wednesday by President Trump, calling them “reckless” in an interview with NPR.

Still—his position has drawn heavy criticism, particularly from Canadian worker groups, who warn the tariffs could hurt cross-border manufacturing partnerships.

Bottom line: While Fain’s stance could fuel confidence in Trump’s trade policies—it’s also stirring division within the North American auto industry.

(Go deeper: 3 min. read)

EV sales crept higher in March—but slow and steady might be the pace for the future.

By the numbers: EV sales made up 9.3% of total vehicle sales in March—a slight increase from last year, but a reminder the growth is far from explosive.

The reason?

Broadly speaking…consumer concerns with charging station availability, time required to charge, and limited driving distance per charge.

And now—tariffs and uncertainty over federal incentives could derail adoption even more.

Zooming out: With EV demand growing incrementally, automakers aiming to capture market share can't afford to misread the pace of adoption.

(Go deeper: 3 min. read)

Thanks for reading everyone.

— CDG

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