“The top theme over the last year or so has really been affordability, and this isn’t only related to the auto industry but really about everything facing consumers. And the issue is ALL about purchasing power or more clearly – the erosion of purchasing power for many Americans over the last several years. We’ve all seen new highs in the stock market that have happened many times this year, and those equity gains and asset appreciation really help high income households. Those consumers are driving a lot of consumption across the economy, but the wealth effect gains are concentrated at the very top of the pyramid. The vast majority of the US population sees little gain from the wealth effect and their number one source of income are the paychecks they take home every week. That’s why inflation matters,” said Jeremy Robb, Chief Economist Cox Automotive.**

“Over the last five years consumer price inflation has risen on average 4.9% each and every year. That’s a compounding effect just like everyone wants to see in their 401K or investment portfolio – BUT – it means prices continue to rise and compound each and every year. Those inflation trends are what really have impacted consumers and the reason most of them call THE top concern. And if we think about the higher gas prices we’ve seen since the Middle East conflict, it impacts the bottom half of consumers much more than higher income groups. The average American has continued to see the erosion of their purchasing power,” said Robb.