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Episode #1310: The market squeeze is real as affordability reshapes buying behavior across the board. Tesla feels the EV slowdown while Rivian pivots toward value, and new data shows Gen Z shoppers aren’t impulsive, just taking their time.

As costs stack up across the ownership lifecycle, automakers are getting real about affordability and how it affects product strategy, pricing, and what actually moves on the lot.

• Subaru is leaning into efficiency and practicality as gas prices rise. “We’re not making V-8 engines…we’ve got four-cylinders, hybrids and electrics. when gas is getting up to $4 and $5, and those things that are sucking gas like crazy, that’s not Subaru.” said marketing head Alan Bethke.
• That shift is showing up in shopper behavior, with Subaru seeing “a lot more movement on our lower trim levels” as buyers hunt for value.
• Across the board, consumers are trading down and prioritizing fuel economy, pushing brands to rethink mix and messaging.
• Even growth brands are leaning into affordability through electrification—Kia reported hybrid sales up 73% as buyers look for cost relief at the pump.
• At Stellantis, CEO Antonio Filosa is tying their turnaround directly to demand alignment: the strategy is working by “delivering the products our customers want and love.

Tesla’s Q1 deliveries came in lighter than expected with U.S. deliveries estimated down 4.6%, showing continued pressure on EV demand as incentives fade and global performance varies.

• Tesla delivered 358,023 vehicles globally, missing expectations and marking its weakest quarter in a year despite a 6.3% YoY increase.
• Rivian offered a contrast, with deliveries up 20% year-over-year—but that growth comes off a weaker base and still represents just over 10,000 units for the quarter.
• Rivian is holding steady on its 2026 outlook (62K–67K units) and launching its lower-priced R2, signaling a clear shift toward more accessible EVs.
• Wedbush’s Dan Ives called Tesla’s results “underwhelming,” but “not a shock…given the current EV backdrop,” as the company bets on future plays like robotaxis and AI.

New data shows younger buyers aren’t rushing purchases. They’re researching more, delaying decisions, and blending online and in-store shopping in ways that challenge old assumptions.

• Half of Gen Z shoppers sit on purchases for two+ days, more than double the rate of boomers, signaling a longer, more deliberate buying cycle.
• Only 40% of shoppers come in knowing what they want—most are browsing, comparing, and figuring it out in real time.
• Even digital-first buyers aren’t fully online—53% of Gen Z still go in-store to browse before buying.
• Despite the hesitation, younger buyers are more willing to spend long-term, with Gen Z and millennials 50% more likely to increase spending in the future.
• “Marketers can no longer rely on broad assumptions…brands must…out-maneuv

Join Paul J Daly and Kyle Mountsier every morning for the Automotive State of the Union podcast  as they connect the dots across car dealerships, retail trends, emerging tech like AI, and cultural shifts—bringing clarity, speed, and people-first insight to automotive leaders navigating a rapidly changing industry.

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