This edition of the Auto Market Weekly Summary includes updates on new-vehicle sales and pricing, the employment situation, retail sales, and consumer confidence. The conflict in the Middle East continues to cast a shadow over sentiment, but tax refunds continue to provide meaningful support to consumer purchasing power and automotive demand.

Bottom Line Up Front

March’s jobs report delivered a headline surprise, with 178,000 payrolls added—the strongest gain since December—but the details tell a more cautious story. Health care drove more than 40% of the gain, rebounding from California’s nurse’s strikes that depressed February numbers, while construction and transportation benefited from weather normalization. Stripping out these one-time factors, the underlying trend remains weak.

The consumer picture is more encouraging than the labor market alone would suggest. The Consumer Confidence Index edged higher in March, while a delayed February retail sales report showed a rebound from January’s weakness. Vehicle purchase plans held steady, signaling sustained interest despite broader economic uncertainty.

New-vehicle sales rose to a 16.3 million SAAR in March, up from February’s weather-depressed pace but down 8.7% year over year against a tough comparison. Last year’s market saw elevated tariff-induced pull-ahead volume that will not be repeated this year, making year-over-year comparisons more challenging through the second quarter. Fleet sales remain a bright spot, while retail share declined.

In consumer confidence, forward-looking expectations fell and inflation expectations surged to 6.2% from 5.5%—the highest since May 2025—as the Middle East conflict keeps energy prices elevated. For now, tax refund dollars are providing a meaningful bridge through a softening labor market, but the spring selling season will test whether that support can offset rising inflation fears and weakening confidence in the months ahead.

New-Vehicle Sales and Pricing

New-vehicle sales in March showed a faster pace than February but continued to track below year-ago levels. Cox Automotive data show weekly new-vehicle sales running lower than last year, even as the weekly pace increased, as is typical for the season. As April and the second quarter begin, comparisons will again be measured against strong 2025 sales levels driven by tariff-induced pull-ahead volume. As a result, year-over-year comparisons are expected to remain weak.

  • March sales finished at 16.3 million SAAR, down 8.7% from a strong year-ago level but above Cox Automotive’s estimate of 15.8 million. The SAAR rose 3.7% from February.
  • Sales volume totaled 1.4 million units in March, down 11.9% from last year but running 17.2% higher than February’s pace.
  • March 2026 had 25 selling days, compared with 26 days in March 2025.
  • Fleet sales helped elevate the sales pace in March, while retail sales were slightly weaker. Retail share fell 20 basis points to 80.5%.
  • Fleet sales are up 4% year to date, with government sales down 1%, while rental and commercial fleet sales are higher.

Jobs and Unemployment

March’s jobs report delivered a headline surprise—nonfarm payrolls rose 178,000, well above consensus—but the details point to continued softening across broader labor market indicators.

  • Job gains were heavily concentrated in health care, which added 76,000 jobs after a California’s nurse’s strike depressed February’s count. Construction and transportation and warehousing also contributed, aided in part by a rebound from harsh winter weather.
  • Prior-month revisions tempered the optimism. January’s gain was revised up by 34,000, while February’s decline was revised down by 41,000 to a loss of 133,000 jobs, resulting in a two-month net revision of a 7,000-job loss. The three-month average stands at a gain of 68,000.
  • The unemployment rate edged down to 4.3% from 4.4%, driven by a shrinking labor force that pulled the participation rate to 61.9%, the lowest since late 2021. The number of long-term unemployed rose to 1.8 million, up 322,000 year over year.
  • Average hourly earnings increased 0.2% month over month, pulling the year-over-year gain rate to 3.5% from 3.8%, the slowest rate since early 2021.
  • Broader labor market data reinforce the softening trend. The Job Openings and Labor Turnover Survey (JOLTS) showed the hiring rate fell to 3.1% in February, the lowest since April 2020. Initial jobless claims remained low for the week ended March 28, indicating the weakness stems from slower hiring rather than elevated layoffs.

Retail Sales

The February retail sales report, delayed by the government shutdown, showed sales rebounded from a weak start to the year, led in part by a recovery in vehicle sales.

  • Retail sales increased 0.6% in February from January and were up 3.7% year over year, the largest gain since September.
  • Excluding autos, sales rose 0.5%, while core sales—excluding autos and gas—advanced 0.4% from the prior month.
  • Core sales gains were led by drug stores, apparel, sporting goods, and miscellaneous retailers, while grocery and furniture stores posted declines of 1.0%.

Consumer Confidence

The Conference Board’s measure of consumer confidence edged higher in March, defying expectations for a decline, though future expectations remain weak and inflation concerns are rising.

  • The Consumer Confidence Index rose to 91.8 in March from a downwardly revised 91.0 in February but remained below the long-run average of 96.
  • Views of the present situation improved to 123.3 from 118.7, reflecting better assessments of current business conditions, while views on job availability were largely unchanged.
  • Future expectations declined to 70.9 from 72.6 in February.
  • Inflation expectations jumped to 6.2% from 5.5%, the highest since May 2025, driven by concerns over higher energy prices linked to the Middle East conflict.
  • Consumers also expect higher interest rates and lower stock prices.
  • Vehicle purchase plans held steady at 12.5%, while home purchase plans edged down to 5.7%.