June 12th, 2026 | Japan's automakers absorb $28B tariff hit; dealerships losing service share

June 12th, 2026 | Japan's automakers absorb $28B tariff hit; dealerships losing service share Automotive News Daily Drive · Jun 12, 2026

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Term

service retention

Service retention is how many customers keep using the same dealership for repairs and maintenance. If people stop coming back, the dealership loses repeat work. That’s what the host says is happening here.

Term

average order value

Average order value is the average dollar amount customers spend per repair visit. The host is using it to show that dealership bills are getting bigger over time. It’s basically “how much each job costs on average.”

Term

average transaction value

Average transaction value is the average amount of money spent per repair transaction. It’s used to compare what dealers charge versus independent repair shops. Higher transaction value means customers pay more per visit.

Term

customer pay

Customer pay means the customer is paying for the repair themselves. The host says this comparison excludes warranty work because warranty can change who pays. So “customer pay” is the real out-of-pocket cost.

Term

independent repair facility

An independent repair facility is a regular auto shop that isn’t the car brand’s dealership. The host compares what these shops charge customers to what dealerships charge. It’s part of explaining why people may stop using dealers for service.

Term

warranty

A warranty is coverage that can pay for certain repairs so the customer doesn’t have to. The host says they’re leaving warranty cases out because those don’t show what people pay from their own pocket. They want to compare real customer costs.

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Welcome to Daily Drive.

For Friday, June 12, 2026, I'm Kellan Walker in Las Vegas.

Today on the show, Japan's automakers have absorbed $28 billion in combined costs because

of U.S. policy whiplash.

Two major auto suppliers are merging and Canada wants a bilateral deal with the U.S. as Trump

says he doesn't want to extend USMCA.

Plus, new data from billions of credit card transactions shows dealerships have been losing

service business to quick loops for years.

And the gap is widening.

They're not losing their business to their cross-branded dealership, they're losing

their business to the independent shop that was an afterthought to them.

Let's run through all the news you need to know to keep up in the auto industry.

Trump's policy whiplash is hitting Japan's automakers where it hurts most.

The bottom line.

An automotive news analysis finds Toyota, Honda, Nissan, Mazda, Subaru, and Mitsubishi

have absorbed $28 billion in combined costs from U.S. tariffs, EV write downs, and emissions

policy reversals.

That number could top $40 billion by March 2027.

Toyota faces the biggest hit, more than $17 billion in tariff costs alone.

Honda is close behind after booking over $9 billion in EV write downs.

Honda saw its first annual loss in nearly 70 years as a public company.

Two major auto suppliers are joining forces.

Dana is merging with Eaton's mobility business in a deal valuing the combined company at

more than $10 billion in enterprise value.

The merger brings together commercial vehicle transmissions, engine and emissions products

with Dana's powertrain and thermal technologies.

The companies expect $250 million in cost synergies within two years of closing.

The deal reflects broader industry pressure, tariffs, EV uncertainty, and a robust aftermarket

as Americans hold onto their vehicles longer.

Close is expected in the first quarter of 2027.

The USMCA clock is ticking and Canada is trying a new approach to keep the deal alive.

Canada US Trade Minister Dominic LeBlanc says he expects bilateral side agreements to be

negotiated between the US and each partner country alongside the broader trilateral framework.

That comes as President Trump said he's not looking to renew USMCA ahead of a July 1 deadline.

Meanwhile, US Ambassador Pete Hoekstra told a Toronto summit Canada has a strong case to

make on autos and told Ottawa simply make us an offer.

And those are today's headlines.

You can find more details on all those stories at AutoNews.com.

This week, our colleagues in Europe hosted some of the most influential industry executives

in the world at Automotive News Europe Congress in Brussels.

Joining me now to talk about what they heard is Doug Bolduck, A&E's managing editor.

Doug, welcome back to Daily Drive.

Hi, Kil, thanks so much for having me.

All right, Doug, so what were your big takeaways from this year's event?

Well, it was in Brussels, so a big focus of this year's event was a piece of legislation

that's going to be very influential on the automotive industry in the years to come,

the Industry Accelerator Act, and how this is going to impact basically competition going forward.

There's a big push in Europe to make sure that the European automotive industry is protected.

So we talked a lot about that, the pros and cons of this particular legislation.

There's still a lot of confusion, still a lot of horse trading to be done,

but that was definitely a topic that was on the minds of everyone,

especially since we were right there in the center of this industry making for Europe.

Now, we face an affordability crisis here in the US over there in Europe.

There are pricing issues, but they're quite different.

What's the deal and what did executives at A&E Congress have to say about that?

Yeah, it's quite interesting because there has been such an influx of Chinese automakers into

the market, and in order to sort of capture the attention of buyers, they've had very,

very competitive prices or using a lot of discounts.

So affordability is creating a lot of competition in that

established players like Opel and Ford and Volkswagen, who used to be able to get a lot of

these volume buyers, are losing a lot of those volume buyers to these Chinese brands because of

the fantastic pricing. One of the topics that was brought up during the course of the Congress was

what's being done, and a lot of it's basically being done. What's being done is that they're

saying, hey, we are going to try to continue to push our brand the quality attributes of our brand.

And there was another interesting take, which was from Philippe Houchois, who is an analyst looking

at the entire automotive industry. His feeling is that price pressure will remain as long as these

players that are coming into the market trying to basically buy market share continue to be in

the market. But eventually that, I mean, again, that runs out of steam. And when these weaker

players leave the market because they just don't get that market share, then prices will start

to level off, stabilize. Interesting stuff. Doug Bolduck, thank you so much for joining me.

Thanks, Kel. Coming up, dealerships have been losing service customers to quick lubes and

independent shops for years. New data built from billions of credit card transactions shows exactly

where the business is going and why. That's next on Daily Drive. Solid-state batteries are going

from hype to reality. And this week on shift, we're digging into what new battery chemistries

could mean for cost and EV adoption. Factorial Energy CEO, Xiyu Huang, talks about developing a

new solid-state liquid metal battery with Mercedes, an innovation that could change the weight and the

cost of new vehicles. With the same energy, we could deliver a lighter pack, which eventually

will be able to drive down the cost of the vehicle. Huang also explains how competition

with China is affecting the solid-state market and the geopolitical tensions impacting the arrival

of solid-state batteries. Join us for a shift available this Sunday wherever you get your podcast.

Welcome back to Daily Drive. I'm Kelin Walker. Dealer service retention has been slipping for

years. And now, there's hard data to show exactly where the business is going. Ducker Carlisle

Analyst, Nate Chenenko, tracks motor vehicle service transactions using Visa and MasterCard data

to map market share across dealerships, quick lubes, tire chains, and independent shops.

He joined our own Dan Shine to talk about why dealers are losing ground, what they're doing

right, and who their real competitor often turns out to be. Nate, thanks so much for

joining me on the Fixed Ops Friday edition of Daily Drive. Hi, Dan. Thanks very much for having

me. Excited to be back. This is like one of my favorite things to do. Well, we love having you.

Ducker Carlisle does amazing work. We just love all the surveys and polls and interesting studies

that you guys do. So I'm glad to have you on to talk about another one. You guys recently do every,

I think maybe every, is it an annual thing, where you kind of look at credit card transactions

for repairs and maintenance and kind of break down who's getting more of the share of repair

or maintenance work than others. First, I guess tell us a little bit about the survey. How do you

break it down? What metrics are you looking at? That kind of thing. Sure. This is part of a product

we launched about two years ago called AfterShare, and we use Visa and MasterCard transactions,

and it is billions of transactions, which was quite a lift for our data team, but we cracked

that puzzle two years ago. So we take all these transactions, and we focus in on just the ones

that are for motor vehicle service and repair, and then we cut out all of the ones that are not

automotive. So you got to remove all the heavy truck topics, all the power sports things, RVs,

et cetera, all get lumped in there. So we focus just on automotive, and then we run it through a

giant set of scripts that tells us exactly which merchant the customer had a transaction at. So

for example, if you recently went to a take five oil change, your credit card statement will say

something like take five oil change, although it probably doesn't say exactly that. So we categorize

all of the major merchants, and we know which transactions are in the motor vehicle service

industry. And this is all DIFM, by the way. So all the do it for me, like I'm going out to get my

vehicle fixed, excluding the do it yourself market. And then you asked about metrics. So the

most important metric that we capture is market share. So again, looking at this from the perspective

of, let's say a tire chain, you can look and see, okay, our market share is, let's just call it 10%

of our market. And even if you are a regional or quite local tire chain, you could see your

market share in your region. So maybe it's the Northeast, or maybe it's just your state like

New Hampshire. And you can tell not only what your share is, but who else in your market has

more or less share than you, and whether your market share is increasing or decreasing over time.

So that's the most important metric that's taking your sales dollars divided by the sales of

everybody else. The second most important metric is the dollars per transaction. Some people call

that an average order value or AOV. And that is in the case of a tire chain, you might say our

average transaction is $650. And you can see how your average transaction changes over time,

as well as how your competitors transactions change over time.

From, let's say January 2025 to January 2026, independent repair facilities, quick loops,

tire chains, all gain market share at the expense of dealerships.

Yes, exactly. Is there a reason for that?

So first I'll expand on this. This is in fact a incredibly broad trend. So our data goes all

the way back to 2022. And this trend has been in place since early 2022. But in fact, it goes

back way further than that. We started collecting information about dealer service retention,

which most OEMs and many dealers look at on a regular basis. And service retention goes down

by just a hair pretty much every year at the vast majority of OEMs and thus the vast majority of

dealerships. So when we look at market share, it's no surprise that dealers are losing market share

because they're losing service retention. The why is this happening question is a little bit

more complicated to answer. And we have a lot of other data sources like our consumer sentiment

survey that we do every year, as well as other customer interviews and research into other

service channels that help point us in the right direction. I suspect nobody will be just

shocked to hear that part of the big driver is price increases at the dealership.

So at dealers since 2022, and I'm going back a little further than you referenced, but just

because I think that it's important to know the long term nature of this trend and not say,

well, this is just a last 12 months thing. This isn't normal. So we're going all the way back to

2022 through the end of 2025. Dealers increase their prices 27%. Well, let me rephrase the

average order value or average transaction value at a dealership went up 27%. That could be because

the work is getting more complex. That's possible. But at independent repair facilities who do a

similar level of complexity in the customer pay side, excluding warranty, of course,

the independent repair facility prices or transaction values only went up 15%.

And just to avoid overwhelming anybody with too many numbers, there's one other problem here,

which is that you have to look not only at the percentages, but also at the actual dollars

at the dealership because the transaction values are so much higher. A 27% increase is about $125

extra per repair order. At an independent repair facility, the 15% increase that they face is

only $50. And customers don't really care whether you increase the cost to them 15% or 27%. They

pay in dollars. That's what shows up on the credit card statement. That's what people talk about.

They don't live in a world of percentages. They live in a world of dollars. And dealers are

literally charging a lot more dollars now than they were three years ago, and even more than

they were a year ago. Like you said, it's a long-term trend. This is, again, they say not a

flash in the pan, small sample size. This goes back to 2022. And is there, I mean,

pricing, I think obviously makes sense. Are there other things that you can see?

This spell is kind of bad news for dealerships. And I don't know if you think you have an idea

how they can reverse this. So dealers and OEMs in order to support the dealers are doing a few

very good things. One is that they're offering free maintenance on new vehicle purchases. This

almost always lasts for two years. In some cases, lasts for three years. And this really does boost

customer retention. Of course, it boosts retention over that two to three year period,

but it does have a lasting effect in our research. And I was actually really skeptical about this

before we studied this in detail in 2024. I was concerned, maybe cynically concerned,

that free maintenance wouldn't actually increase customer retention beyond the first few years,

but it really does work. So that's an area where OEMs are providing a lot of support.

Dealers are making great progress in one particularly important area that the aftermarket

has not yet caught up on, which is technician video, where they have the technician go around with

a phone typically, film a short video walk around, send that to the customer, usually through some

tech platform. And that is a big customer trust builder. And it can justify the reason for the

$125 price increase. It's also a good way to upsell work, although that generally does not

delight the customer. It is good for the bottom line. So those are a few things that dealers

are doing well. Some areas where dealers are struggling is they are really having a hard time

um beyond the technician video aspect. There is a cohort of customers out there who is

let's politely say they're extremely naive when it comes to auto maintenance.

And we don't think any aspect of the after sales business or any of the parts and service

companies out there are doing a particularly good job reaching these customers. These are

customers who don't even necessarily know when they need a tire change. They definitely don't

know what tires to put on. They may not have any idea how much they cost, but they don't even know

how when they need a change. And it used to be that they would teach you in like high school

auto class to put a penny upside down in the tire. And if you can see the top of Abe Lincoln's head,

then you need new tires. They don't even make pennies anymore. So nobody has any idea how to

tell if they need tires unless they grew up in that era and can kind of guess at it.

So those are some of the areas where we think that everybody needs to improve, but especially

dealers. Nate, it's interesting stuff. Great data. Your report kind of is I think good for

service managers, general managers, dealer principals to be able to kind of see what the

landscape is like and see what their market share is like and then maybe price accordingly.

You have to know what your market share is because otherwise you don't know who you're

up against. And I'll tell a really quick story. We ran this report for a dealer in Indiana.

And before running the data, they said they told us our biggest competitor is the

other branded store across town. When they do an oil change promotion, our oil change volume

drops. And that's where we lose all of our business too. We ran the numbers. Turns out

their biggest competitor is actually a little two bay independent shop like eight miles east of town.

And they had no idea. They knew the shop was there, but they had no idea the volume that this

shop did. They're not losing their business to their cross branded dealership. They're losing

their business to the independent shop that they was an afterthought to them.

Interesting. The great stuff. Really love talking to you about all the work that

Ducker Carlisle does. It's interesting. Just interesting research. So really appreciate

your time, Nate. Thanks, Dan. We appreciate it too.

Thank you.

It's moving these customers up.

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19:34

service retention

average order value

average transaction value

customer pay

independent repair facility

warranty

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