All Eyes on March as Early 2026 Follows Seasonal Patterns (Video)
- StoneEagle
- 5 hours ago
- 5 min read
Early 2026 data shows the market holding steady despite pressure on front-end margins. Attention now turns to what March will reveal.
By Gregory Arroyo
Reviewing a chart showing the 82% decline in front-end gross since its January 2022 peak, Joe St. John doesn’t see a dealership problem. He sees a market shift.
“I don’t think everyone magically became unbelievably good at the car business in July of 2021, and now we all suck again,” said the former AutoFi executive and F&I trainer who came up in dealerships, teaches through NADA Academy, and has spent years challenging how the business operates.
St. John, who now serves as corporate F&I director for Kansas City-based Oakes Auto Inc., joined StoneEagle CEO Cindy Allen for Episode 1 of TCP Review, a new series where Allen goes one-on-one with industry leaders to break down the trends behind StoneEagleDATA — transaction-level benchmarks covering more than half of the U.S. automotive retail market. Watch the full discussion above.
The early read on 2026 is steady. “26 is feeling a lot like the beginning of 25 did,” St. John said, describing a market that, through the first two months of the year, is holding its shape.
Allen pointed to March as the inflection point for how the year will take shape. “We always see that March bump for folks who are getting their tax returns. Every year we see it,” she said. “The amazing thing in 2025 is that we also had that tariff fear entering the market … but when we looked at those numbers, we weren’t really taking away from future months. We were adding volume in March last year.”
Where the Market Stands Now
Industry reporting has framed 2026 around affordability pressure, softer demand, rising inventories, and renewed tariff uncertainty. A year ago, those same concerns delivered a record March, with deal counts reaching 131 per dealer and F&I income rising to $243,598 — the highest level recorded in StoneEagle’s dataset.
Through the first two months of 2026, volume is running almost exactly where it did a year ago. Dealers averaged 100 deals in January and 101 in February, compared with 101 and 102 over the same stretch in 2025.
“We’re tracking right along that same line,” Allen said. “Nothing has really broken yet.”
F&I income, however, is running ahead of last year’s pace. January and February combined are averaging $199,127 per dealer, compared with $185,964 over the same period in 2025 — a 7.1% increase driven by stronger per-deal performance.
That lift is coming from per-deal performance. F&I profit per vehicle retailed reached $2,004 in February, up from $1,812 a year earlier, and up 61% since 2019.
The underlying drivers haven’t moved much. Products per deal are holding at roughly 1.56 to 1.57, while penetration across the top products remains within its typical range — service contracts around 45%, GAP near 40%, paint and fabric protection around 20%, prepaid maintenance in the mid-teens, and tire and wheel near 10%.
(Watch the full discussion above for Allen’s breakdown of what’s driving the increase in PVR.)
Total gross per deal tells a different part of the story. Dealers are still averaging roughly $2,500 per vehicle — about $900 higher than where the industry operated just a few years ago — even as front-end gross has come down significantly from its peak.
That gap is where the conversation shifts.
The Illusion of Control
At the peak of the post-COVID market, dealers were averaging nearly $2,800 per vehicle in front-end gross. By December 2025, that number had fallen to $279. On paper, it looks like a collapse. In practice, it exposed how much of that performance was tied to conditions outside the dealership.
For operators who came up during that stretch, those conditions became the baseline. Pay plans, inventory strategy, and deal structure were built around margins that would never hold.
St. John pointed to the disconnect that creates when the market resets.
“You had a market that allowed you to do things you normally wouldn’t be able to do,” he said. “And people started to think that was just how the business worked.”
Managers are still working deals the same way, but the economics underneath them have changed. “When you were making $2,800 a car versus $279 a car, it’s a wildly different business,” St. John said.
“You have processes and structure that have been built during that time period that may not be effective if your margin profile is so dramatically different.”
The result isn’t a drop in capability. It’s a mismatch between how the business was learned and how it now operates.
March Becomes the Sales Season
For years, the industry’s biggest performance windows came later in the year, as volume built through the summer and into year-end. That pattern has shifted.
“It almost seems like an industry perception now … March is the month,” St. John said. “When I was in it, it was always May. And then it was August. And then it was December.”
That shift is taking shape at a time when the broader environment is anything but settled — affordability pressure remains, operating costs are rising, and uncertainty around fuel prices and global events is starting to weigh on consumer sentiment. At the same time, the underlying retail data has yet to break from last year’s pattern.
Through the first two months of 2026, deal counts are tracking almost exactly in line with 2025. March now represents not just a seasonal lift, but a test of whether that stability will hold as the year unfolds.
“Our March is on track to be an incredible March — a massive spike over January and February,” St. John said, noting that it’s easy to measure today’s performance against the peak conditions of 2021 and 2022 and come away thinking something is missing.
“If I were to go back and run the store I ran in the teens, and that store was a national average store making $1,651 front to back, we were profitable,” he said. “If I had gone from $1,651 to $2,503, I would have been super profitable, and I would have looked like a hero.
“So for me, I think the story here that we as an industry should really be considering is what has happened to our structure and model during these really inflated times that is making it hard for us to feel like we can run a profitable dealership at $2,500 a throw.”
That’s when Allen jumped in: “And what we see is dealers pulling the right levers. They’re doing what they need to do to keep the dealership profitable moving forward.”