Company: TRUE
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001327318-25-000065
Chunk: 351

Company: TrueCar, Inc.
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 2
Chunk 351
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 dealers such as the TrueCar Certified Dealers on our network, and which is a transaction structure we are not currently able to monetize. Changes in governmental policy may also negatively impact consumer demand for cars in ways that adversely impact our business. For example, the One Big Beautiful Bill Act eliminated federal tax credits that benefit consumers who purchase electric vehicles, effective as of September 30, 2025. To the extent that the elimination of such credits causes fewer consumers to purchase electric vehicles sold by TrueCar Certified Dealers and such consumers do not purchase internal combustion vehicles as an alternative, our business may be adversely affected. 

Interest rates in particular can have a significant impact on automobile purchases and affordability due to the direct relationship between interest rates and monthly loan payments. Interest rate increases by the U.S. Federal Reserve, such as those implemented in 2022 and 2023 as well as any additional increases that could occur in the future, could negatively affect the number of vehicles purchased by consumers, and any reduction in purchases could adversely affect automobile dealers and car manufacturers and lead to a reduction in other spending by these constituents, including targeted incentive programs. Higher interest rates combined with increased vehicle prices resulting from low inventory, as discussed in the risk factor entitled “Our business is subject to risks related to the larger automotive ecosystem, including tariffs, inventory and global supply chain challenges, labor and other factors,” or other factors may also increase the amount of time that consumers wait between purchasing vehicles as the ability for a consumer to trade in or sell an existing vehicle to finance a new purchase may be diminished if the value of any loans associated with such existing vehicle are high relative to the underlying value of the vehicle itself. Increases in interest rates may also result in dealers purchasing lower amounts of inventory from manufacturers due to increases in dealers’ own financing costs.

Similarly, inflation may negatively affect consumer behavior and purchasing power, reducing the number of cars purchased by consumers during periods of heightened inflation. For example, during the twelve months ended June 30, 2022, consumer prices increased 9.1% according to the Department of Labor, and while increases in the rate of inflation have slowed since the summer of 2022, rates of inflation have remained consistently elevated compared to the years leading up to the coronavirus pandemic, and we cannot predict the extent prices will continue to rise, including in response to tariffs, or the long-term effects these conditions may have on consumer behavior.

Further, economic impacts and the impacts on consumer behavior resulting from responses to the coronavirus pandemic negatively affected our business in a number of ways