J.P. Morgan/Chase Auto Annual Franchise Dealership Survey: Results Show Growing Pessimism on Volumes, P&S and New GPU; Digital Auction Penetration Robust (ACVA Seeing Traction Again); AI Adoption Growing; EV P&S Skepticism Rising

Research evidence excerpt

J.P. Morgan/Chase Auto Annual Franchise Dealership Survey: Results Show Growing Pessimism on Volumes, P&S and New GPU; Digital Auction Penetration Robust (ACVA Seeing Traction Again); AI Adoption Growing; EV P&S Skepticism Rising

oup (click here for detailed takeaways) flagged rising purchase

deferral activity in pickup truck-heavy markets like California and Texas.

• OEM tariff mitigation viewed as only partially complete, with further pricing

actions and dealer margin compression expected ahead; broader consensus around

front-end GPU moderation in 2H26. Just a quarter of dealer respondents indicated their

partner OEMs have fully adjusted to the tariff environment, while ~40% anticipate

further cost pass-through with model year 2027 pricing, ~20% expect further dealer

margin compression through higher invoice prices and lower incentives/support, ~10%

expect production cuts and/or US lineup rationalization, and ~5% see significant tariff

mitigation actions still ahead — luxury dealer responses skewed more heavily toward

MSRP/invoice and production cut levers given limited near-term production flexibility.

Regarding drivers of new vehicle GPU pressure, rising ATPs and a weak new vehicle

retail sales environment (cited by ~22% and ~21%, respectively) displaced lower OEM

incentives (~20%, vs. ~30% in 2025) as the top GPU constraints, which in our view

reflects the cumulative impact of multi-year above-normal ATP inflation, with elasticity

now more visibly weighing on retail throughput. The vast majority (~90%) of dealers

expect further front-end GPU pressure through 2H26, with domestic dealers skewing

most cautious on magnitude (~51% expecting significant declines vs. ~39% for import

and ~38% for luxury) and import dealers most optimistic on resilience (~15% expecting