Two U.S. auto giants reported a drop in sales. What's going on?

Ford Motor Company and General Motors, the two largest U.S. automakers, recorded a decline in U.S. sales in the first quarter of 2026. They attributed the weak results to last year's strong demand and weather factors, Yahoo Finance writes.

Ford reported an 8.8% drop in sales in the US in the first quarter compared to the same period last year. General Motors sales, according to the report for the first quarter, fell by 9.7% to 626,000 cars.

As pointed out in Ford, the weak results are largely due to a frenzy of demand a year ago: in March 2025, buyers were actively buying cars in anticipation of the introduction of duties, the volume of sales across the industry reached 18.4 million cars in one month - the maximum since April 2021, recalls Yahoo Finance. This atypical surge in demand has made it difficult to compare the first quarter of 2026, the company explained. General Motors said that additional pressure came from weather: "harsh winter conditions in January and February" worsened sales dynamics.

Ford's sales of F-Series pickup trucks fell the most - by 16%. The company attributed this, among other things, to the postponement of production after last year's fires at the aluminum plant, which limited supply, while in its class F-150 remains the leader in sales, Ford points out and expects a recovery in the second half of the year. At the same time, it managed to increase its market share to 11.6% due to demand for large SUVs.

Sales of electric cars Ford collapsed by 70%. In many respects, the cancellation of the $7500 tax credit had an impact, while further possible sales growth may be affected by the high price of oil, Barron's notes.

General Motors said that after a weak start to the quarter in March, deliveries have already started to recover and were up nearly 18% from February amid improving weather conditions. "We saw gradual improvement in dealership traffic and sales during the quarter," said Duncan Aldred, president of GM's North American division.

A key factor for the industry is affordability, Yahoo Finance points out. The average price of a new car in the U.S. is approaching $50,000, and the cost of borrowing money remains high. And now the market is also under pressure from sharply rising gasoline prices.

Ford shares ended trading on April 6 with a slight decline, with the stock having lost 12% of its value since the beginning of the year. The average Wall Street target price is $13.9, suggesting a potential upside of about 20% to current quotes.

The consensus position of analysts on the company is neutral: 18 - advise to keep its securities in the portfolio, five - recommend to buy, and two - to sell, follows from the dataMarketWatch.

General Motors shares were up 1.2% on Monday, but are down 10% since the beginning of the year.

19 out of 29 analysts surveyed by Marketwatch recommend buying this auto company's securities, eight take a neutral stance and two analysts suggest selling the company's securities. The average target price is about $95.5, which is 30% higher than the current price.

This article was AI-translated and verified by a human editor