May 7, 2026 | New Jersey dealers fight broker networks; April sales takeaways

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Welcome to Daily Drive. For Thursday, May 7th, 2026, I'm Kellan Walker in Las Vegas.

Today on the show, Ram wants more dealers chasing small business buyers.

EVs get cheaper in Canada before Chinese brands get there,

and US auto sales fall for the fourth straight month.

Plus, New Jersey dealers are pushing back against broker networks,

and they say manufacturer pressure is making the problem worse.

If you're stepping into the equation and adding an extra fee for the consumer that's not necessary,

that shouldn't be happening at our state.

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

Ram wants more dealers chasing small business buyers, but those customers don't just walk

into showrooms. Business owners expect dealers to come to them. That means sending salespeople

out to meet plumbers, electricians, florists, meeting them where they work.

To sweeten the deal, Stalantis brought back the Hemi V8 and is launching the ProMaster

City Van in early 2027, filling a small van segment most automakers abandoned years ago.

Dave Sowers, who runs Ram's professional division, says dealers can't just dip their toes in.

He says, quote, you have to be all in.

Electric vehicle shoppers in Canada right now are catching automakers in a price war.

EVs are starting at just under $30,000 thanks to factory incentives stacked on top of the

federal government's $5,000 rebate. According to JD Power Canada, automakers were offering

up to $13,000 in incentives in the first quarter. There's a reason for the fire sale.

Chinese automakers are entering the market later this year and incumbents are pricing

down ahead of their arrival. And U.S. auto sales fell nearly 7% in April,

marking the fourth straight monthly decline. Global data cut its 2026 sales forecast to

$16 million, citing high prices and hesitant customers. But hybrids are surging as gas hits

four bucks a gallon nationwide. And imports continue losing ground down 16% as tariffs bite.

Joining me now to break down April's results is automotive news senior automaker editor

David Phillips. Dave, welcome back to Daily Drive.

Glad to be here, Phil.

All right, David. So what are your biggest takeaways from April?

Well, the market is clearly resetting. If we looked last year in 2026, there were two big shocks

that really created some distortion in the market. Obviously, the tariffs that went into

effect in April prompted a lot of people to go out and buy a new car in March, April, thinking

they were going to lock in a decent price before tariffs raised any sort of prices.

And I would say that even kind of trapped into May. And then the market kind of settled down.

And then when Congress decided to end the tax credits for EVs, we saw a big spike in

August and September last year as people rushed to buy out an EV to take advantage of that tax

credit. So the market is clearly resettling right now and recalibrating and what I would say,

more normal level. So we do have headwinds this year. I mean, affordability is still a big issue.

We now have the Middle East situation where gas prices have spiked. And so everybody's trying

to figure out how long that shock's going to last. And consumer confidence has taken a bit of a dip.

When we talk to executives in the industry, there's a lot of dealers that are just basically

getting customers that basically have to buy a new car at a necessity. Now that being said,

the market hasn't collapsed. Employment remains stable. We haven't seen a lot of layoffs. And

that's the big determining factor about whether people have confidence to go out and buy a new

car. And the new car buyer tends to be more affluent than the average US consumer. So that's

why we haven't seen a collapse in the market. But we're kind of definitely in a holding pattern

right now. Incentives and inventory remain in check. But there are some analysts that have

dropped their forecast for sales this year, citing inflation. There's some analysts that

don't think that we're going to see any relief in interest rates. If inflation accelerates and the

Fed has to be more aggressive in keeping inflation in check. And right now, I mean, a lot of

automakers and dealers are trying to buy down. Given the affordability issue and the high

prices of cars today, there's a lot of dealers and OEMs that are advertising 0% financing and

low rate finance deals 1.9% or deferring payments for 90 days to get anybody that might be on the

fence about buying a new car off the fence. But overall, I mean, the market's recalibrating.

So if we knew what's going to happen in the Middle East, I guess we could all get a better

view of how the rest of the year is going to play out. But in every company has its own issues right

now. Well, speaking of the Middle East, we've seen huge hybrid sales. Now, are there other

factors pumping up the hybrid sales? Or is it all about the Iran war driving up gas prices?

If you check with Autotrader and Kelly Blue Book and some of these third-party shopping sites,

they definitely have seen a spike in interest, people looking at, and even EVs. I mean, we've

all talked about the recalibrating EV market. I mean, I think there's still some interest in EVs

right now. But hybrids always see a big spike in interest when gas prices go up. The thing with

hybrids right now is that, and they are up, but if you can find one, you better buy it,

because a lot of them were pre-sold before they even, I was at a Honda store this week here in

Metro Detroit, and they had zero hybrids in stock. Now, in the case of Toyota, if you want to

camera, you can only buy it with a hybrid. The new RAV4, there's a new redesigned RAV4, which is

the top-selling car or vehicle at Toyota right now. They're in the process of changing over

their plans to build a new RAV4. That will only come in a hybrid too. It used to be back in the

day, you paid a little bit of a premium for a hybrid too, because it was more expensive to engineer,

but some companies like Toyota and Honda that have been in the market now with hybrids for

a couple of decades, they have the economy, scale to be competitive when it comes

to pricing. Now, you're not going to get a discount on a hybrid, but for those companies that have

them right now, they're really benefiting, because customers do want them, but the weight is going

to be a long time. I won't say a long time for a hybrid, but you'll have to wait or put money down

to get one, because there's just a lot of dealers that don't have them in stock right now, because

everybody wants one. Perfect. Dave, so insightful. Thank you so much for joining me.

You bet. Anytime. Coming up, New Jersey dealers are fighting back against brokers.

Laura Parata, president of the New Jersey Coalition of Automotive Retailers says

manufacturer pressure to hit unrealistic targets is fueling the problem. That's next on Daily Drive.

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Welcome back to Daily Drive. I'm Kellan Walker. In New Jersey, a shadow market of unlicensed

brokers has been growing. Middlemen who charge consumers extra fees to buy vehicles from dealers.

Laura Parata is president of the New Jersey Coalition of Automotive Retailers. She says

the state needs to crack down on brokers. Parata spoke with our own Molly Boygon and Larry

Veliquette about how the system works, why it's growing, and what needs to change.

Laura Parata, president of the New Jersey Coalition of Automotive Retailers,

thanks so much for joining us. Thanks for having me, Molly.

So the New Jersey Motor Vehicle Commission sent out a letter on March 17 reminding dealers about

their obligations to not use broker arrangements. What are brokers and how does the system work?

So brokers are, in essence, middlemen that are really trying to work with certain communities

that feel like they need a broker. Maybe it's certain ethnic communities, whether Russian

populations or Hasidic Jews, that feel that they want to go through a third party broker to

purchase a new vehicle. So this is something they're doing for a fee. So the customer is

actually paying an additional fee to the broker that, from our perspective, isn't necessary

on top of what they're paying for the new car. And in New Jersey, to clarify,

it's illegal to use a broker for a fee in the state of New Jersey.

Now, I want to ask you, so it's illegal to use a broker for a fee. Is it illegal on the part of

the consumer or on the part of the dealer to use the broker? It's illegal for the dealer,

but it's also the brokers are illegal to be operating in the state of New Jersey too,

because they're unlicensed. So in order to sell a new vehicle, you have to have a new

car dealer license in the state of New Jersey. So brokers are operating in a shadow area,

under the radar, with no license to sell a new vehicle.

Broking arrangements, to my understanding, have been around for a long time. So why do you think

this issue is cropping up right now, and why is it cropping up in New Jersey?

Yeah, that's a great question. Molly, this has been going on for decades, brograin.

And historically, it's bubbled up at certain periods of time, basically by manufacturer,

where brograin's gotten very prevalent. It's happening right now. And it's usually because

of stair step programs that the manufacturers are setting for dealers to hit targets that are

artificially high. And so there's pressure from the manufacturer to the dealer to move the metal.

And that's when the brokers seem to come into more prevalence. And also, I think we have another

factor where we're seeing a lot of brokers coming into our space from New York state, because they

were, you know, recently, there's been regulations to regulate the dealers in New York, and now they're

really coming into the New Jersey market. So I think that we have a convalesce,

a really perfect storm of situations where we've got some aggressive stair step programs.

We've got dealers feeling pressure to move the metal and hit targets that are

impossible to hit. And then on top of that, we have a really growing swath of brokers in New York state.

So the reason for this, then, are these are brokers coming in from New York state specifically?

Well, they're here in New Jersey, too, and they should be shut down. They're both. But we're seeing

just like a real groundswell of brokering right now. It's just really, really becoming more and

more prevalent. And I don't think I answered one of your other questions about the memo, too. And

I'm sorry, I know you asked me a question about the memo. I apologize. No, that's okay. So why

then the memo now? You said there's been more visibility for these brokers, perhaps more

brokers coming in from New York. What prompted the sending of that letter? Yeah, so there was a law

of change in New Jersey. It was 2001 was when it was clarified that only new car dealers are allowed

to sell vehicles. So it was made very, very clear that brokering is not allowed in the state of

New Jersey. That was 2001. So 2004, the Motor Vehicle Commission promulgated the regulations

that like set out the rules of the road, if you will. And then we have a very uptick recently

in brokering activity that and a new administration, the Sheryl administration just came as the new

governor of New Jersey and a new commissioner for the Motor Vehicle Commission. So all these

factors led to just an awareness that it's good to put folks on notice that these are the

regulations in the state of New Jersey so that everyone's aware. So it's a 25-year-old law?

That was the last time it's changed then? Oh, I'm sorry if I misspoke. It was 2021, I apologize.

2021, okay. 2021. I did. I must speak. 2021 was when Title 39 was amended to make clear that

only new car dealers can sell new cars in the state of New Jersey. So in 2024 was when the

MVC promulgated the new regulations. But with the uptick in brokering, the new administration

chose to send out this notice to make sure folks were aware of the regulation.

Let me jump in here, Molly. So Laura, if it's illegal for a dealer to engage a broker,

why is the use rising? Well, I'll go back to it. It's the pressure. It's the pressure they're

feeling from their manufacturers to hit targets. And on top of that, just the move the metal generally.

The market's been very all over the place, as we know. It's really hard, tariffs, war,

gas. I mean, every sling and arrow that could come at dealers is coming, but they still have to

move the inventory after a lot. And so it's just pressure from all sides, especially with the

targets that the manufacturers are setting for the dealers. And then on top of that, there's been

a lack of enforcement on the brokering situation. And so of course, if brokers are, if it's happening

and no one's saying, hey, that's coloring outside of the lines, then people will continue to do so.

Yeah. What type of enforcement actions would there be? And what would be the agency that would

sort of take action against the dealerships that are using brokers? It would have to be

the Bonner Vehicle Commission. They have the authority to do this. And under the regulation,

it is the possibility of a revocation of the dealer license or fines. I imagine fines would

probably be really where they'd begin. I doubt they would just come in and shut down a dealer.

But I imagine fines. And in Pennsylvania, I was talking to the Pennsylvania Dealers Association

the other day, and they love you fines the state. I'm not sure which entity it is within the state.

They love you fines against the brokers. And it's been successful per transaction. They're so fine.

And they've really been able to tamp down. Can you tell us a little bit more about what you're

aware of in terms of the landscape in the rest of the country? So in New Jersey, there's a

ban on the use of brokerages. In New York, there's a system where brokers can be licensed by the

state. Do you have a sense of what is common and what is not in other states in terms of the

ways that the states are regulating brokerages? Yeah. Molly, I would say it's all over the map

for the country. And I will say too that from its mind understanding that a lot of the challenges

with brokers coming into the marketplace has been very regional. It's very severe, I would say,

in New York and New Jersey where they're really growing and Connecticut, Miami, I've heard, Florida.

But then other states just don't seem to face the same onslaught. I was just talking

to one of the other association leaders that we don't understand why it's

so concentrated in New York, New Jersey, whereas Chicago, you don't hear about it. Los Angeles,

you don't hear about it. It's a very interesting dynamic that seems to be very much regionalized.

So I want to ask Laura a little bit about there are different types of brokers, right? There's the

traditional, the community broker that you spoke about within, say, the Hasidic Jewish community,

Koreans, et cetera, Russians where they have people within their community. There's also

a lot of dealers maintain outside sales people where they're doing outside sales,

maybe off of a previous book of business that a salesperson might have.

And the automakers are asking them in the letters that we have, they're asking them

to make sure that they're labeled if they're brokered sales, if they're outside sales people,

et cetera. What other types of brokers are there and are there legitimate types of outside sales?

Personally, I feel like if you're stepping into this equation as a broker and you are putting an

extra fee on selling a new vehicle in the state of New Jersey, that's not legal in our state.

So those are the rules as far as I'm concerned. If you're stepping into the equation and adding

an extra fee for the consumer that's not necessary, that shouldn't be happening in our state because

that is what the law says. I think it's pretty fair. If this is costing consumers ultimately,

and you know what it's really doing? It's devaluing the franchise system. The brokers are

touting a sales number that's really a low ball that's not realistic to the market,

and they're charging a fee on top of that. So it's a race to the bottom. All of a sudden,

the dealer is not going to make any money off the transaction, and let's be honest. I mean,

if you're an auto dealer, you deserve to get paid for a service that you're providing,

which is a new car. Now the broker's coming in low balling the cost of the vehicle

and charging a fee to the consumer. This seems pretty unnecessary really in the long and short

of it for the consumer. I'm afraid the consumer is not being explained the whole process that

that fee is not necessary. We can bring the vehicle to you, we can do an online sale,

we can deliver the vehicle to you just in the same way that a broker can. You don't necessarily

have to be there in the dealership for hours, so we can provide the same service.

That's Daily Drive for today. I'm Kellan Walker. Thanks to our own David Phillips and Vince

Bond Jr. for their reporting for today's podcast. We also have reporting from David Kennedy of our

sibling publication, Automotive News Canada. You can get the latest news on April sales results,

the broker battle in New Jersey, and everything happening in the auto industry at AutoNews.com.

Come back tomorrow for a conversation with John Massano of Massano Auto Group in Pennsylvania

about why he sold his collision center. I would think more people would do this,

but I was in that vote. I wasn't going to sell until I did.

May 7, 2026 | New Jersey dealers fight broker networks; April sales takeaways

About this episode

Protective Asset Protection

Ram

broker networks

extra fee for the consumer

Stalantis

Hemi V8

Ram ProMaster

price war

federal government's $5,000 rebate

factory incentives

JD Power Canada

hybrids surging

tariffs

EV tax credits

consumer confidence

0% financing

low rate finance deals 1.9%

deferring payments for 90 days

hybrid sales

EVs

Toyota RAV4

New Jersey Coalition of Automotive Retailers

broker arrangements

New Jersey Motor Vehicle Commission

unlicensed brokers

new car dealer license

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