Even with new tariffs on imported cars and car parts, American car buyers paid slightly less in May for new vehicles.
Data from Edmunds.com on Thursday showed that the the average price paid for new cars edged down 0.2% to $48,334 last month compared to April.
The dip came despite higher prices from automakers: The average new-car sticker price automakers requested rose 0.2% last month, to $50,527.
The prices are good news for buyers worried that tariffs would put vehicles out of reach, especially with car prices near record highs already. But it could also signal weaker demand and consumer reluctance to spend.
Car prices are not unilaterally set by automakers, but through negotiations between car dealers and car buyers.
The 25% tariffs on imported cars and parts took effect April 3. Every major automaker that sells cars in America, other than Tesla, imports vehicles. Nearly half of US auto sales last year – 46% – were imports.
A month later, in May, 25% tariffs on imported auto parts went into effect, which is important because every car built at US auto plants has some imported parts.
The two tariffs are costly for automakers: General Motors has said it expects tariffs to cost it $5 billion by the end of this year.
Most of the cars sold in May arrived at US dealerships before the tariffs on cars and car parts took effect. Automakers, scared of spooking customers and risking President Donald Trump’s ire, have been slow to announce price increases despite their rising costs. Executives from Ford and General Motors have said they don’t expect significant car price increases throughout the year.
Part of that is because the demand for car sales has softened recently. With low consumer confidence and high interest rates, fewer Americans are considering buying new cars, according to a survey by The Conference Board, which tracks consumer attitudes. And many car buyers rushed to buy cars in March before the tariffs took effect.
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