TrueCar CEO Scott Painter said mounting affordability pressures and trade uncertainty are changing how consumers shop for vehicles, with manufacturer incentives creating a major opportunity for dealers and new-car buyers.
The details: Painter said TrueCar's real-time shopping activity is already showing significant shifts in consumer behavior as buyers continue seeking vehicles even as prices rise, in a recent interview with Bloomberg.
TrueCar searches for hybrids have increased to nearly three times their normal level, while new-car searches have declined almost 50% since the war in Iran began.
Consumers are increasingly seeking value through used vehicles and lower price points, added the CEO.
The shift toward used vehicles is likely to tighten supply, push used prices higher and strengthen residual values, Painter explained.
“We're definitely seeing… a mix shift from new to used, from premium to mainstream, from large to small, from I'll buy now to I'll buy later,” the TrueCar founder told Bloomberg. “All of those things are happening for sure, but the demand for mobility is not dropping.”
Why it matters: Consumers are still in the market, but affordability pressures are changing what and when they buy, giving dealers an opportunity to use manufacturer incentives and a broader mix of new and used inventory to capture demand as shoppers increasingly prioritize value.
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Between the lines: Painter said trade uncertainty is the industry's biggest risk—as the U.S. continues intense negotiations with Canada and Mexico that could significantly impact the future of North American auto trade.
Short-term developments in U.S.-Canada tariff negotiations do little to resolve broader supply-chain issues because automakers plan years, not months or quarters, ahead, he noted.
While the trade strategy might be well-intentioned, repeated policy changes are creating significant uncertainty for automakers, Painter said.
Manufacturers can price in risk when they have stability, but continued back-and-forth on tariffs makes long-term planning much more difficult, he added.
“It creates tremendous uncertainty, which is by far the bigger, more negative impact on the auto industry,” Painter said. “Automakers can almost price in any kind of risk if they have some kind of stability. It's really this cagey sort of back and forth that makes it very, very difficult.”
Bottom line: Painter's assessment suggests vehicle demand is just shifting, not necessarily disappearing, as consumers become more price-conscious, making affordability, incentives, and inventory mix increasingly important for dealers looking to convert shoppers while broader trade uncertainty continues to cloud the industry's outlook.
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