New car prices near record high, Michigan Gov. warns against Canadian tariffs, Ram eyeing compact truck market

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Hey everyone. Did you know Mazda almost didn’t make it as a car brand?

In the mid-90s, Ford increased its stake in Mazda to 33.4% to stabilize the struggling automaker, holding influence over it for years.

But today—Mazda is fully independent and is one of the most successful standalone car brands.

Find out why in today’s Breakdown newsletter.

— CDG

1. New car prices rise four months in a row to near-record high

December’s car market wrapped up the year with rising prices and strong demand for high-end models.

• The average new vehicle price climbed to $49,740, just below the all-time high, driven by record sales of vehicles over $80,000 and demand for full-size pickups.

• But affordability took a hit, with monthly payments averaging $756—the highest in six months—and buyers needing 38.2 weeks of income to afford a new car.

• On the bright side, incentives held steady at about 8% of transaction prices—or about $3,958 per vehicle.

Bottom line: Analysts predict affordability will improve in 2025, but December made one thing clear—confidence fuels spending, even when prices are steep … (Go deeper: 2 min read)

2. Michigan Governor warns Canadian tariffs could hurt U.S. auto industry

Michigan Governor Gretchen Whitmer is raising concerns about the impact of potential tariffs on Canada, warning they could shake up the state’s auto industry.

Driving the news: Speaking at the Detroit Auto Show, she pointed out how vital cross-border trade is to Michigan’s $304 billion auto economy and cautioned that tariffs could raise car prices, disrupt supply chains, and put jobs at risk.

While she’s not entirely against tariffs, Whitmer called for a balanced approach to avoid long-term damage.

As President-elect Trump prepares to take office, Whitmer says she’s ready to work with his administration to protect Michigan’s interests … (Go deeper: 3 min. read)

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3. Ram CEO ‘desperately’ wants a smaller compact truck

Ram CEO Tim Kuniskis says he “desperately” wants a smaller pickup in the U.S. lineup to compete with hot sellers like the Ford Maverick, Toyota Tacoma, and Hyundai Santa Cruz.

These compact and mid-size trucks are winning over price-conscious buyers while Ram continues to focus on full-size models.

Meanwhile, markets like South America have enjoyed models like the Ram Rampage, a compact truck built on the Jeep Compass platform—exactly the kind of vehicle American buyers have been asking for.

Whether Ram brings an international model stateside or designs something new, the move could help dealers compete in a market that’s shifting toward affordable options … (Go deeper: 3 min. read)

Why dealerships are breaking up with widgets for good

Speaking at the Automotive Leadership Roundtable in Washington, D.C., Brian Benstock, GM and Partner at Paragon Honda, discussed the power of AI and predictive marketing—where dealers anticipate customer needs instead of reacting to them.

The industry’s fragmented tech landscape, riddled with competing vendor tools and sluggish websites, is another area dealerships must address.

Industry insiders like Patricia Muyshondt, CMO at Sames Auto Group, and FordDirect CEO Dean Stoneley, stressed the need for streamlined, customer-focused systems that simplify the buying experience.

The message is clear—dealerships that embrace innovation, invest in AI, and prioritize customer experience will shape the future of automotive retail. The rest risk falling behind … (Go deeper: 5 min. read)

• Honda asks Nissan if it can buy out Renault’s stake, report says.

• Exclusive: Chinese buyers interested in unwanted German Volkswagen factories, source says.

• Trump DOT nominee signals extra fees for EVs, continued NHTSA investigation into Tesla.

• Toyota truck unit Hino to pay $1.2 billion fine for U.S. emissions fraud.

• Tesla is offering Cybertruck discounts as EV market gets crowded.

Thanks for reading everyone.

— CDG