Auto ECON Updates

Auto ECON Updates (90)

In the week ending March 4, the advance figure for seasonally adjusted initial claims was 211,000, an increase of 21,000 from the previous week's unrevised level of 190,000. The 4-week moving average was 197,000, an increase of 4,000 from the previous week's unrevised average of 193,000. The advance seasonally adjusted insured unemployment rate was 1.2 percent for the week ending Feb. 25, an increase of 0.1 percentage point from the previous week's unrevised rate. The advance number for seasonally adjusted insured unemployment during the week ending Feb. 25 was 1,718,000, an increase of 69,000 from the previous week's revised level. The previous week's level was revised down by 6,000 from 1,655,000 to 1,649,000. The 4-week moving average was 1,679,500, an increase of 9,500 from the previous week's revised average. The previous week's average was revised down by 1,500 from 1,671,500 to 1,670,000.

TrueCar released the latest version of its Automotive Shopper Trends Report, a comprehensive look into auto shopper actions and expectations.

The report shows that although new-car inventory is returning, high interest rates continue to add to affordability challenges and influence how consumers approach car buying. Below are some insights from this edition of the ASTR:

  • Despite the economy and high prices, 54% of car shoppers are entering the current market because they say they need a car now.
  • For the sixth quarter in a row, the average loan term for a used car was longer than the average loan term for a new car, due to consumers’ desires to keep monthly payments low.
  • Consumers are changing their mind during the buying process: 7% of shoppers who prospected for a new car ended up buying used, a 10% increase since Q1-Q2 2022.

Additionally, the report found that 95% of shoppers want to do at least some part of their deal online, revealing a new persona: the omnichannel shopper, a consumer looking to do any amount of their car purchase online, before going into the dealership. These shoppers have a variety of traits that define their shopping experience, including:

  • 80% of omnichannel shoppers have a vehicle budget of $50K+
  • 76% want the latest technology
  • 74% are considering an EV as their next purchase
  • 66% plan to lease

“Car buyers and their expectations have changed over the past few years as the automotive industry continues to shift, especially with the move toward online marketplaces,” said Mike Darrow, president and CEO at TrueCar.

For the second consecutive year, more than 1 billion units of food, drugs, medical devices, automobiles, and consumer products were recalled in the U.S. According to Sedgwick’s latest state of the nation recall index report, 2022 was a record-breaking year for the number of units recalled, reaching nearly 1.5 billion.

With regulatory scrutiny continuing to increase, 2023 may shape up to be another 1 billion unit year, requiring businesses across industries to remain vigilant on matters of product safety and recall preparedness.

Among Automakers, Ford had the most recalls, with 67 affecting 8,636,265 vehicles

2022 recall data highlights:

  • Automotive recalls decreased 12.6% in 2022 compared to 2021. The sector also experienced a 10.3% decline in the number of units recalled, marking a nine-year low.
  • While the number of consumer product recalls increased by nearly a third (31.2%) in 2022 over 2021, the number of units recalled almost halved (45.4%), from 42.8 million in 2021 to 23.4 million in 2022.
  • FDA food recalls experienced a 700.6% increase in the number of units impacted in 2022. With 416.9 million units recalled, this represents a 10-year high. While the United States Department of Agriculture (USDA) food recalls held steady in terms of the number of events, the volume of units recalled decreased significantly (87.0%) from 13.4 million pounds in 2021, to 1.7 million pounds in 2022.
  • While pharmaceutical recall events fell by a third (32.5%) in 2022, the number of impacted units recalled more than doubled (114.4%) to 567.3 million. This marks a 10-year high for the industry.
  • Recall events in the medical device industry increased by 8.8% in 2022, up from 837 events in 2021 to 911. The number of units impacted decreased 27.2% from 2021 to 438.7 million units in 2022.

What’s ahead in 2023:

  • Electric vehicles (EVs) will remain a key focus for the automotive industry, regulators, and lawmakers in 2023, as the U.S. continues to move toward a zero emission future. Manufacturers may also find their vehicle’s “smart features” the target of new regulations, as cybersecurity becomes a greater threat in increasingly connected vehicles. With experts recommending that industry standards should be developed, regulators may begin work on this task in 2023.
Tesla had over 4 million recalls, the second-most among U.S. automakers in 2022. 

“The year ahead will likely be characterized by the same strict regulatory enforcement that all industries saw in 2022,” shared Chris Harvey, Sedgwick senior vice president of brand protection. “Regulators have now fully returned to pre-pandemic levels of activity and are making up for lost time with a steady slate of long awaited guidelines and modernizations to existing regulations. Businesses will face the tough challenge of remaining agile with their operations to accommodate new regulations, while simultaneously anticipating and preparing for potential economic and geopolitical issues.”

Automakers with the most Recalls in 2022: 

  1. Ford: 9,141,131 cars, 72 recalls.
  2. Tesla: 4,132,303 cars, 21 recalls.
  3. General Motors: 3,415,313 cars, 34 recalls.
  4. Fiat-Chrysler/Stellantis: 3,338,259 cars, 33 recalls.
  5. Nissan: 2,037,432 cars, 16 recalls.
  6. Kia: 1,490,939 cars, 26 recalls.
  7. Hyundai: 1,468,531 cars, 24 recalls.
  8. Mercedes-Benz: 1,417,652, 35 recalls.
  9. Volkswagen: 1,100,114 cars, 47 recalls.
  10. BMW: 1,038,420 cars, 26 recalls.



The Conference Board Consumer Confidence Index decreased in February for the second consecutive month. The Index now stands at 102.9 (1985=100), down from 106.0 in January (a downward revision). The Present Situation Index—based on consumers’ assessment of current business and labor market conditions—increased to 152.8 (1985=100) from 151.1 last month. The Expectations Index—based on consumers’ short-term outlook for income, business, and labor market conditions—fell further to 69.7 (1985=100) from a downwardly revised 76.0 in January. Notably, the Expectations Index has now fallen well below 80—the level which often signals a recession within the next year. It has been below this level for 11 of the last 12 months.

“Consumer confidence declined again in February. The decrease reflected large drops in confidence for households aged 35 to 54 and for households earning $35,000 or more,” said Ataman Ozyildirim, senior director, economics at The Conference Board.

“While consumers’ view of current business conditions worsened in February, the Present Situation Index still ticked up slightly based on a more favorable view of the availability of jobs. In fact, the proportion of consumers saying jobs are ‘plentiful’ climbed to 52.0 percent—back to levels seen in the spring of last year. However, the outlook appears considerably more pessimistic when looking ahead. Expectations for where jobs, incomes, and business conditions are headed over the next six months all fell sharply in February.

“And, while 12-month inflation expectations improved—falling to 6.3 percent from 6.7 percent last month—consumers may be showing early signs of pulling back spending in the face of high prices and rising interest rates. Fewer consumers are planning to purchase homes or autos and they also appear to be scaling back plans to buy major appliances. Vacation intentions also declined in February.”



Consumers’ assessment of current business conditions worsened slightly in February.

  • 17.8% of consumers said business conditions were “good,” down from 19.9%.
  • 17.7% said business conditions were “bad,” down from 19.0%.

Consumers’ appraisal of the labor market was more favorable.

  • 52.0% of consumers said jobs were “plentiful,” up from 48.1%.
  • 10.5% of consumers said jobs were “hard to get,” down from 11.1%



Expectations Six Months Hence

Consumers became more pessimistic about the short-term business conditions outlook in February.

  • 14.2% of consumers expect business conditions to improve, down from 18.4%.
  • Meanwhile, 21.9% expect business conditions to worsen, down from 22.6%.

Consumers were less upbeat about the short-term labor market outlook.

  • 14.5% of consumers expect more jobs to be available, down from 17.7%.
  • Yet, 20.3% anticipate fewer jobs, down from 21.4%.

Consumers’ short-term income prospects became considerably less upbeat.

  • 13.4% of consumers expect their incomes to increase, down from 17.4% last month.
  • 11.6% expect their incomes will decrease, down from 13.4% last month.

The monthly Consumer Confidence Survey, based on an online sample, is conducted for The Conference Board by Toluna, a tech company that delivers real-time consumer insights and market research through its innovative technology, expertise, and panel of over 36 million consumers.

From the preceding month, the personal consumption expenditures price index for January increased 0.6 percent, according to estimates released by the Bureau of Economic Analysis.

Prices for goods and services both increased 0.6 percent as well. Food prices increased 0.4 percent and energy prices increased 2.0 percent. Excluding food and energy, the PCE price index also increased 0.6 percent.

Personal income increased $131.1 billion (0.6 percent) in January. Disposable personal income (DPI) increased $387.4 billion (2.0 percent) and personal consumption expenditures (PCE) increased $312.5 billion (1.8 percent). The PCE price index increased 0.6 percent in January. Excluding food and energy, the PCE price index also increased 0.6 percent. Real DPI increased 1.4 percent and Real PCE increased 1.1 percent; goods increased 2.2 percent and services increased 0.6 percent.

The increase in current-dollar personal income in January was led by an increase in compensation, reflecting private wages and salaries in both services-producing industries and goods-producing industries. Government social benefits decreased in January, reflecting a decrease in “other” benefits that was partly offset by an increase in Social Security. The decrease in “other” benefits primarily reflected the expiration of the extended child tax credit (as authorized by the American Rescue Plan) as well as a decline in one-time refundable tax credits issued by states. The increase in Social Security primarily reflected an 8.7 percent cost-of-living adjustment. The $312.5 billion increase in current-dollar PCE in January reflected increases of $162.2 billion in spending for goods and $150.2 billion in spending for services. Within goods, the increase was widespread and led by motor vehicles and parts as well as “other” nondurable goods (led by pharmaceuticals). Within services, the largest contributor to the increase was spending for food services.

General Motors' Chevrolet division has idled its Corvette assembly plant in Bowling Green, Kentucky due to a continuing parts shortage. GM stated “the parts shortage is not due to a semiconductor chip issue” though they failed to say what parts were in short supply.  The plant employs over 1,300 people and plans to resume production on Monday, February 27th. 

The last time the plant was idled was in October 2022, for a week. Production of Corvette Stingrays and the Corvette Z06 , the vehicles produced in Bowling Green have suffered quite a few setbacks in recent years, due to Covid shutdowns and parts issues. 

The Consumer Financial Protection Bureau released a report examining trends in credit reporting of debt in collections from 2018 to 2022. The report found the total number of collection tradelines on credit reports declined by 33%, from 261 million tradelines in 2018 to 175 million tradelines in 2022. The share of consumers with a collection tradeline on their credit report decreased by 20% in the same timeframe. The CFPB also today released additional analysis examining factors that increase the likelihood of inaccurate medical collections reporting and may contribute to the decline in medical collections tradelines.

“Our analysis of credit reports provides yet another indicator that, due to a strong labor market and emergency programs during the pandemic, household financial distress reduced over the last two years,” said CFPB Director Rohit Chopra. “However, false and inaccurate medical debt on credit reports continues to be a drag on household financial health.”

Collections tradelines are furnished to credit reporting companies by third-party debt collectors. Commonly reported collection items include medical, rental and leasing, credit card, and utility accounts. Some third-party collectors work on behalf of original creditors for a fee (“contingency-fee-based debt collectors”) and others purchase accounts outright from creditors (“debt buyers”).

Unlike most other tradelines, debt collection tradelines rarely report positive information like on-time payments, and result in reporting of collections tradelines being almost entirely harmful to consumers. Collections tradelines are visible to potential lenders, employers, landlords, and others who run credit inquiries or background checks. Collections tradelines can limit people’s access to jobs and housing, as well as decrease credit scores and increase the cost of credit. Given the potential damaging impacts of collections tradelines, reporting of inaccurate data is especially harmful.

The recent report is drawn from the CFPB’s Consumer Credit Panel, a nationally representative sample of approximately 5 million de-identified credit records maintained by one of the three nationwide credit reporting companies.

Key findings of this report include:

  • The decline in collections tradelines was driven by fewer reports by contingency-fee-based debt collectors, who primarily collect on medical bills. Contingency-fee-based debt collectors reported 38% fewer collections tradelines from Q1 2018 to Q1 2022, while the number of collections reported by the subset of debt buyers increased by 9% over the same period. The number of unique contingency-fee-based debt collectors also declined by 18% (from 815 to 672). Medical bills account for 68.9% of furnished collections by contingency-fee-based debt collectors.
  • Concerns about data integrity and the associated costs that would come with furnishing disputed information may explain some of the decrease in collections tradelines on credit reports. CFPB market monitoring indicates that contingency-fee-based debt collectors are moving away from furnishing collections information to credit reporting companies in part due to their concerns about data integrity and their ability to comply with the Fair Credit Reporting Act, including dispute processing.

The Producer Price Index for final demand increased 0.7 percent in January, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. Final demand prices declined 0.2 percent in December 2022 and advanced 0.3 percent in November. On an unadjusted basis, the index for final demand rose 6.0 percent for the 12 months ended January 2023. In January, a 1.2-percent rise in prices for final demand goods led the advance in the final demand index. Prices for final demand services also moved higher, increasing 0.4 percent.

The index for final demand less foods, energy, and trade services rose 0.6 percent in January 2023, the largest advance since moving up 0.9 percent in March 2022. For the 12 months ended in January 2023, prices for final demand less foods, energy, and trade services increased 4.5 percent.

Job openings rates increased in 10 states and the District of Columbia and decreased in 1 state on the last business day of December, the U.S. Bureau of Labor Statistics reported Feb. 15. Hires rates increased in four states. Total separations rates increased in seven states and decreased in six states.

Nationally, the job openings rate increased in December while the hires and total separations rates showed little or no change.

The release includes estimates of the number and rate of job openings, hires, total separations, quits, and layoffs and discharges for the total nonfarm sector and for all states and the District of Columbia.

In December, job openings rates were little changed in 39 states. The largest increases in job openings rates occurred in North Dakota (+1.6 percentage points), as well as in Michigan and Minnesota (+1.3 points each). The decrease occurred in Georgia (-0.6 point). Over the month, the national job openings rate increased (+0.3 point).

The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.5 percent in January on a seasonally adjusted basis, after increasing 0.1 percent in December, the U.S. Bureau of Labor Statistics reported Feb. 14.

Over the last 12 months, the all items index increased 6.4 percent before seasonal adjustment.

The index for shelter was by far the largest contributor to the monthly all items increase, accounting for nearly half of the monthly all items increase, with the indexes for food, gasoline, and natural gas also contributing. The food index increased 0.5 percent over the month with the food at home index rising 0.4 percent. The energy index increased 2.0 percent over the month as all major energy component indexes rose over the month.

The index for all items less food and energy rose 0.4 percent in January. Categories which increased in January include the shelter, motor vehicle insurance, recreation, apparel, and household furnishings and operations indexes. The indexes for used cars and trucks, medical care, and airline fares were among those that decreased over the month.

The all items index increased 6.4 percent for the 12 months ending January; this was the smallest 12-month increase since the period ending October 2021. The all

 items less food and energy index rose 5.6 percent over the last 12 months, its smallest 12-month increase since December 2021. The energy index increased 8.7 percent for the 12 months ending January, and the food index increased 10.1percent over the last year.

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