Ongoing economic uncertainty and rising costs are making consumers more cautious about how they spend on vehicles and related services, according to an industry expert.
A combination of inflation, higher everyday expenses and global instability is weighing on consumer confidence, explained Michael Chung, senior director of market intelligence at the Auto Care Association. He described the consumer as bruised and battered.
“It’s like the 13th round of a 15-round heavyweight bout,” he said. “We’re getting hit, but we’re fighting on.”
Chung said concerns about personal finances, employment and rising costs for essential goods are contributing to a more cautious mindset, with consumers increasingly focused on managing day‑to‑day expenses.
“It’s the day-to-day, it’s the getting by, it’s the ‘I’m just trying to live another day,’” mentality,” Chung said.
That pressure is affecting how consumers approach spending, particularly for larger purchases or discretionary items. Many are delaying non‑essential spending or reassessing priorities as they navigate uncertain economic conditions.
“People are expecting to spend less,” Chung said.
He noted that rising costs across sectors — including fuel, insurance and general living expenses — are contributing to a broader sense of financial strain.
“Everything’s getting more expensive,” he said.
Global factors are also adding to the uncertainty. Ongoing geopolitical tensions and supply‑chain disruptions are pushing up costs for raw materials and logistics, with effects expected to continue over the medium term.
“Not an issue that’s going to be resolved anytime soon,” Chung said.
Those conditions are creating a challenging environment for both consumers and businesses, particularly as price increases outpace income growth.
Now we’re at a point, thanks to high gas prices, where inflation is exceeding wage growth,” Chung explained. “Not good.”
The result is a more cautious consumer, with many prioritizing essential spending and reducing discretionary purchases where possible.
“It’s going to be a belt‑tightening time,” Chung said.
Despite these headwinds, he noted that the broader economy still shows signs of stability, with steady growth expected in the near term.
“We are expecting to see incremental growth,” he said.
However, he cautioned that the pace of that growth is likely to remain modest, particularly as consumers continue to adjust to higher costs and ongoing uncertainty.
As a result, Chung explained that companies across the aftermarket will need to account for more selective and value‑focused consumer behaviour, with spending decisions increasingly shaped by affordability and necessity rather than preference.
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