Consumer Industry Report - Q1 2025

Report Highlights

Elements Affecting the Dynamics and Outlook of the Consumer Industry in Q1 2025 and Beyond

• The Federal Reserve held rates steady in early 2025, with inflation stabilizing at 2.7%. Consumer spending remains mixed across segments.
• Auto loan demand remains steady with lower borrowing costs, but EV and hybrid sales have softened as incentives phase out. Affordability concerns and limited charging slowed adoption, while traditional vehicle sales hold firm.
• Discretionary spending is under pressure, with consumers prioritizing essentials over non-necessities. E-commerce continues to grow, leveraging AI-driven personalization, but inflation-driven price sensitivity has increased the need for discounting.
• Consumer services, including dining, travel, and entertainment, maintain steady demand, though rising wages and labor shortages create cost pressures. Businesses are investing in automation and digital tools to offset labor challenges.
• Household and personal care brands continue to see strong demand for sustainable and wellness-focused products. Companies emphasizing eco-friendly packaging and ingredient transparency are gaining share.
• Supply chains have improved, but rising labor costs remain a challenge. Companies are ramping up automation and AI to boost efficiency and control expenses.

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Reach out to Dinan Capital Advisors Managing Director Lisa Kaufman for more report insights.