Part 9/11:
All these factors—rising loan defaults, tightening credit, declining vehicle values, and dealership failures—are feeding into a potential credit crunch that could trigger a broader recession. Jamie Dimon warns that as banks revise their credit standards, the credit-dependent economy faces a serious threat: Without accessible credit, economic activity slows dramatically.
In addition, automobile manufacturing costs are rising due to tariffs, which threaten profitability. Companies might pass these costs to consumers, leading to higher prices amid weakening demand, further complicating the market landscape.