The Confidence Recession

Daniel Govaer, Strategic Project Manager at Beaver Toyota of Cumming, might have just delivered one of the clearest explanations of today’s consumer slowdown — without ever mentioning interest rates, incentives, or income bands.

Instead, he pointed at fast-casual restaurants.

Which, oddly enough, might be the perfect proxy for automotive retail.

The Data Behind the Dip

U.S. restaurant spending grew 5–6 percent year-over-year in Q3 2025. On paper, that looks strong. But inflation-adjusted visits tell a different story: fewer people are actually eating out .

Dollar KPIs look healthy.

Human behavior says otherwise.

That’s the heartbeat of a Confidence Recession — a moment when people feel uncertain enough to pause small luxuries before they pause major commitments.

And when restaurant customers hesitate over a $12 burrito bowl, it’s a preview of how they’ll behave when they walk into (or avoid) a dealership.

The “Slopbowl” Crash: A Generational Signal

Chipotle, Cava, Sweetgreen — all reported the same trend:

Young consumers didn’t switch to competitors.

They switched to groceries .

That’s not a brand preference issue.

It’s a confidence issue.

When people no longer feel sure about small discretionary purchases, their threshold for big ones collapses.

Skipping Chipotle equals skipping a car payment — same psychology .

Not “no.”

Just “not now.”

Behavioral Inflation: The Invisible Price Increase

Economists call this behavioral inflation — the moment when the feeling of stretch outpaces the actual math .

People aren’t financially unable.

They’re emotionally unconvinced.

Confidence used to justify small luxuries.

Now, caution vetoes them.

That shift changes everything for both fast-casual chains and car dealerships.

The Value Equation Has Changed

Govaer points out that discounts won’t rebuild confidence .

Neither will price cuts, incentives, or giving up gross.

You can’t discount your way back to trust.

Buyers want a reason to believe that price = value = control.

They want reassurance, not rebates.

The best stores don’t lower their prices.

They strengthen their signal.

The Takeaway: Confidence Is the New KPI

The next economy won’t be measured only in dollars.

It’ll be measured in Confidence Per Dollar — how much assurance a buyer feels for every dollar they spend.

Price is math.

Confidence is psychology.

And right now, psychology is running the show.

Dealers who learn to sell belief — not just metal — will win the next cycle.

ASOTU Take

This pattern isn’t isolated. We’re seeing the same hesitation in service approvals, trade-in decisions, and even job applications across retail auto. The trust curve has flattened, and that makes confidence the most valuable currency in the building.

Dealers who communicate value clearly and consistently will outperform the market — not by selling harder, but by restoring belief. Because when confidence returns, everything else follows.

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