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Amazon Sought Tariff Loophole Used by Chinese Rivals. Now Biden Is Closing It.

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Under pressure from Chinese competitors, Amazon, Walmart and other U.S. retailers have been exploring ways to avoid tariffs. Could a new Biden administration rule change that?Major American retailers including Amazon and Walmart have been quietly exploring shifting toward a business model that would ship more goods directly to consumers from Chinese factories and require fewer U.S. workers in retail stores and logistics centers.The plans have been driven by the rocketing popularity of Chinese e-commerce platforms like Shein and Temu, which have won over consumers with their low prices. These platforms ship inexpensive products directly to consumers’ doorsteps, allowing them to bypass American tariffs on Chinese goods, along with the hefty costs associated with brick-and-mortar stores, warehousing and distribution networks.Rising competition from Shein, Temu and other Chinese companies is pushing many major U.S. retailers to consider shifting to a similar model to qualify for an obscure, century-old U.S. trade law, according to several people familiar with the plans. The law, known as de minimis, allows importers to bypass U.S. taxes and tariffs on goods as long as shipments do not exceed $800 in value.But that trend toward changing business models may have been disrupted on Friday, when the Biden administration abruptly moved to close off de minimis eligibility for many Chinese imports, including most clothing items. In an announcement Friday morning, the Biden administration said it would clamp down on the number of packages that come into the country duty-free using de minimis shipping, particularly from China.The Biden administration’s changes will not go into effect immediately. The proposal will be subject to comment by industry before being finalized in the coming months, and some imports from China would still qualify for a de minimis exemption.But Friday’s action may head off a change that has been looming in global retail. Amazon has been preparing a new discount service that would ship products directly to consumers, allowing those goods to bypass tariffs, according to people familiar with the plans. Even companies that preferred to keep their business models as-is — like Walmart — have been forced to consider using more de minimis to compete.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Feeling Consumers’ Pain, Retailers Bring Back Discounts

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    The pandemic shopping boom led many stores and brands to widen profit margins by charging more. Now value is the watchword as shoppers grow choosier.U.S. consumers, fatigued by a three-year bout of inflation, want lower prices. And large retailers that have increased prices, partly to contend with their own rising costs, appear to be responding to customer concerns — to an extent.Walgreens said last week that it was lowering prices on over 1,000 items. Target recently announced modest price cuts on 5,000 food products and household goods. Craft and furniture stores like Michael’s and Ikea have also said they will drop prices on popular items.A broader range of companies have indicated on quarterly earnings calls that they plan to slow price increases and seek other ways to expand profitability.Signaling empathy with customers facing higher living costs is an increasingly important marketing strategy, retail analysts say. But regardless of motivation, a shift is in motion that may help ease inflation in the coming months.“Retailers have recognized they have to make some movement on pricing because the customer now is getting to the point where they’re shopping around more, they’re cutting down on the amount that they buy,” said Neil Saunders, managing director at GlobalData Retail, a research and consulting firm.In some ways, the industry seems to be entering a new phase.After a slog for retailers during much of the 2010s, when they often resorted to heavy discounts to gain or maintain market share, the pandemic upended consumer habits. Suddenly, bank accounts were buoyed by emergency federal aid, and millions of consumers unable or unwilling to spend on in-person services shifted to buying goods.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Car Deals Vanished During the Pandemic. They’re Coming Back.

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    Automakers and dealers are starting to offer discounts, low-interest loans and other incentives to lure buyers as the supply of cars grows.For much of the last four years, automakers and their dealers had so few cars to sell — and demand was so strong — that they could command high prices. Those days are over, and hefty discounts are starting a comeback.During the coronavirus pandemic, auto production was slowed first by factory closings and then by a global shortage of computer chips and other parts that lasted for years.With few vehicles in showrooms, automakers and dealers were able to scrap most sales incentives, leaving consumers to pay full price. Some dealers added thousands of dollars to the manufacturer’s suggested retail price, and people started buying and flipping in-demand cars for a profit.But with chip supplies back to healthy levels, auto production has rebounded and dealer inventories are growing. At the same time, higher interest rates have dampened demand for vehicles. As a result, many automakers are scrambling to keep sales rolling.Wes Lutz, owner of Extreme Dodge in Jackson, Mich., said he had several Dodge Challengers and Chargers that were eligible for $11,000 discounts from Stellantis, the manufacturer of Dodge, Chrysler, Jeep and Ram models. The automaker is also offering discounts of up to $3,600 on certain versions of the Dodge Durango sport utility vehicle.“It seems like we may be headed back toward incentives and overproduction,” Mr. Lutz said. “It’s not there yet, but it’s getting close.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Consumers Hate ‘Price Discrimination,’ but They Sure Love a Discount

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    The Wendy’s debacle is a warning shot for brands: If you want to play with prices, make sure to communicate why and whom it could help.It’s been a strange and maddening couple of years for consumers, with prices of essential goods soaring and then sinking, turning household budgets upside down.Listen to this article with reporter commentaryOpen this article in the New York Times Audio app on iOS.Perhaps that’s why, in late February, the internet revolted over Wendy’s plan to test changing its menu prices across the day. If the Breakfast Baconator winds up costing $6.99 at 7 a.m. and $7.99 three hours later, what in life can you really count on anymore?The company later issued a statement saying it would not raise prices during busy parts of the day, but rather add discounts during slower hours. Nevertheless, the episode won’t stop the continued spread of so-called dynamic pricing, which describes an approach of setting prices in response to shifting patterns of demand and supply. It might not even stop the growth of “personalized pricing,” which targets individuals based on their personal willingness to pay.And in many circumstances, customers may come around — if they feel companies are being forthright about how they’re changing prices and what information they’re using to do it.“There’s a need for some transparency, and it has to make sense to consumers,” said Craig Zawada, a pricing expert with PROS, a consultancy that helped pioneer dynamic pricing by airlines in the 1980s and now works across dozens of other industries. “In general, from a buyer standpoint, there has to be this perception of fairness.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

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    Auto Sales Are Expected to Slow After a Strong 2023

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    Automakers sold more cars in 2023 than a year ago as supply chain chaos ended, but sales are now under pressure from higher interest rates.After enjoying a strong rebound in sales in 2023, the auto industry appears headed for slower growth this year as consumers struggle with elevated interest rates and high prices for new cars and light trucks.Edmunds, a market researcher, expects the industry to sell 15.7 million vehicles this year. That would amount to a modest increase from the 15.5 million sold last year, when sales jumped 12 percent.“There’s definitely pent-up demand out there, because people have been holding off purchases for a while,” said Jessica Caldwell, head of insights at Edmunds. “But given the credit situation, we don’t think the industry will see a ton of growth this year.”Since the coronavirus pandemic, automakers have struggled with shortages of critical parts that have prevented them from producing as many vehicles as consumers wanted to buy. In 2023, the shortages, especially for computer chips, finally eased, allowing production to return to more normal levels.But over the past year, the Federal Reserve has significantly raised interest rates, which has pushed up costs considerably for car buyers.For years, many people took advantage of zero-percent loans to buy vehicles, even as prices climbed. But such deals, offered by automakers to move inventory, have nearly disappeared in the wake of the Fed’s rate hikes. In the fourth quarter of 2023, new-vehicle sales with zero-percent financing accounted for just 2.3 percent of all sales, according to Edmunds.Monthly payments are at near-record highs. In the fourth quarter, the average monthly payment on new cars was $739, up from $717 in the same period a year ago.Several automakers were hoping that a rapid rise in sales of new electric vehicles would drive the industry to gains into 2024 and 2025, but those cars and trucks haven’t taken off quite as quickly as many analysts and executives had hoped.In 2023, sales of battery-powered models in the United States topped one million vehicles for the first time, and Cox Automotive, another research firm, expects sales to reach 1.5 million this year. But General Motors, Ford Motor, Volkswagen and other manufacturers had been expecting an even faster ramp-up.But consumers have balked at the high prices of many of the newest electric models. Many drivers are also reluctant to make the switch to battery power, because they are not sure they will be able to find enough places to quickly refuel. That has forced automakers to reset their plans.G.M. had once forecast it would produce 400,000 electric vehicles by the middle of 2024 but now has given up that target, and it has delayed the production of some electric models.Ford had been aiming to have enough factory capacity by the end of 2024 to make 600,000 battery-powered vehicles a year, but it recently lowered production plans for its electric F-150 Lightning and its electric sport-utility vehicle, the Mustang Mach-E.On Wednesday, G.M. said that its sales of new vehicles in the United States jumped 14 percent last year. The company sold 2.6 million cars and light trucks in 2023, up from 2.3 million in 2022, when the chip shortage limited production.G.M. sold about 76,000 electric vehicles, up from 39,000 in 2022. But most were Chevrolet Bolts, a model that the company recently stopped making. Only about 13,000 were vehicle based on newer battery technology that G.M. had been hoping would make its electric vehicles affordable to many more car buyers.Sales for G.M. in the fourth quarter were relatively weak. They climbed just 0.3 percent from the same period a year earlier and were down 7 percent compared with the third quarter of 2023. The company said the sales of several important models were limited by a strike at some of its plants by the United Automobile Workers union.Separately, Toyota Motor, the second largest seller of cars in the United States after G.M., said its 2023 sales rose 7 percent, to 2.2 million vehicles. The company’s sales in the fourth quarter were 15.4 percent higher than in the same quarter a year ago and about 5 percent higher than in the third quarter.Stellantis, the maker of Chrysler, Ram and Jeep vehicles, said that it sold 1.5 million cars and trucks in 2023, about 1 percent less than the year before. The company plans to introduce eight new electric vehicles this year, and it aims to have battery-powered models account for half of its North American sales by the end of the decade.Honda, Hyundai and Kia also on Wednesday reported strong U.S. sales for 2023 And on Tuesday, Tesla, which dominates the electric car business in the United States, said it sold 1.8 million cars worldwide last year, up 38 percent from 2022.Ford is expected to report its sales total on Thursday. More

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    Holiday Spending Increased, Defying Fears of a Decline

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    While the pace of growth slowed, spending stayed strong because of robust job growth and strong wage gains.Despite lingering inflation, Americans increased their spending this holiday season, early data shows. That comes as a big relief for retailers that had spent much of the year fearing the economy would soon weaken and consumer spending would fall.Retail sales increased 3.1 percent from Nov. 1 to Dec. 24 compared with the same period a year earlier, according to data Mastercard released on Tuesday. The credit card company’s numbers are not adjusted for inflation.Spending increased across many categories, with restaurants experiencing one of the largest jumps, 7.8 percent. Apparel increased 2.4 percent, and groceries also had gains.The holiday sales figures, driven by a healthy labor market and wage gains, suggests that the economy remains strong. The Federal Reserve’s campaign to rein in high inflation by raising interest rates over the last few years has slowed the economy, but many economists believe a so-called soft landing is within reach.“What we’re seeing during this holiday season is very consistent with how we’re thinking about the economy, which is that it’s an economy that is still very much expanding,” said Michelle Meyer, Mastercard’s chief economist.Solid job growth is allowing people to spend more. And even though consumer prices have risen a lot in the last two years, wages have grown faster on the whole.“We’re now entering the period, and we’re seeing it to some extent during the holiday season, where consumers have built up real purchasing power,” Ms. Meyer said.Still spending in categories like electronics and jewelry declined this season. And the rate of growth in spending has moderated from the last couple of years. In 2022, retail sales during the holiday season increased 5.4 percent, according to the National Retail Federation. In 2021, they rose 12.7 percent, the largest percentage increase in at least 20 years. Online sales growth has also slowed in 2023, increasing 6.3 percent compared with 10.6 percent from 2021 to 2022, according to Mastercard.While the economy is strong overall, Americans are being more mindful of how they’re spending, and that discretion shaped the shopping season.Some retailers had expressed concerns in recent months that shoppers appeared glum and fearful about the economy. Walmart and Target noted that shoppers seemed to be waiting for sales before buying, a change from recent years when they spent more freely.“The caution that they’ve taken on their spend and where they’re spending has been really noticeable in the second half of the year, where a lot of customers have been affected, especially lower-income and middle-income” people, said Jessica Ramírez, a retail research analyst at Jane Hali & Associates.In a return to some of the trends that prevailed before the pandemic, many retailers and brands offered promotions. Discounts were in the 30 to 50 percent range, Ms. Ramírez said. But the discounts were more targeted this year than last because fewer companies were saddled with gluts of inventory.Retail sales increased this holiday season compared with the same period a year earlier, though at a slower pace than last year.Maansi Srivastava/The New York TimesThe categories that have faced falling sales this year — like electronics, home furnishings and toys — saw some of the biggest discounts leading up to Christmas. Those goods had enjoyed booming sales during the pandemic.Alexan Weir, a 30-year-old mother in Orlando, Fla., said she was pleased to find deals on toys when she bought Christmas gifts for her daughters this month. Among the items she bought at Target were the Asha doll, based on the main character from the Disney movie “Wish”; an Elsa doll from “Frozen”; and a Minnie Mouse kitchen set. With discounts, the items together cost about half as much as their total list prices of $200.“As a parent you’re just trying to make your kids happy. You’re not trying to break the bank,” Ms. Weir said. “I spent a little bit more this year, but at least with the few sales that I received, I can say I was not heartbroken about how much I was spending.”Barbie — whose banner year was fueled by the blockbuster movie — sold particularly well in a year when there wasn’t a breakout toy. The doll and her many accouterments have been selling well at Mary Arnold Toys, a family-owned store on Manhattan’s Upper East Side. And overall sales at the shop have been steady, said Ezra Ishayik, who has run the store for 40 years.“It looks like it is about even with last year — not better, not worse,” Mr. Ishayik said. “The economy looks good to me. It’s decent, it’s OK, people are buying. We are on the high end of the industry so we don’t see any downtrend at all.”But the past few months have been more challenging for Modi Toys.Modi, an online retailer, sells plush toys and books based on Hindu culture and usually sees two sales bumps in the fourth quarter — one in the lead up to Diwali and another around Christmas.Normally the company brings in more than $100,000 in sales in the month before Diwali, which fell on Nov. 12, but this year sales dropped into the five-figure range. That was partly because the retailer launched a product too early and then had to offer hefty discounts to spur sales — something retailers try to avoid with new merchandise.“That’s when we knew that we really were going to have a challenging holiday season,” said Avani Modi Sarkar, a founder of the company.As she wraps up the year and looks toward 2024, Ms. Sarkar is testing new digital marketing strategies, including sending personalized email newsletters to customers and closely monitoring discounts.“We’re just trying to close the gap for us and not end the year with as big of a gap as we would have,” she said. “I know what we’re capable of, and I’m trying to not only get to that level again, but surpass it.”One clear sign that shoppers are being more careful about how much they spend comes from discount retailers. In November, Burlington, an off-price retailer, and the parent company of Marshalls and T.J. Maxx said they saw comparable store sales increase 6 percent.The online retailer ThriftBooks said its sales were also up this holiday season, by more than 20 percent in November and more than 24 percent this month compared with a year ago, according to Ken Goldstein, the company’s chief executive.“This was unprecedented,” Mr. Goldstein said. “This is beyond belief in terms of the volume that we’re doing. Because we’re a value product, I think a lot of people are putting their dollars to work.” More

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    U.S. Consumers Are Showing Signs of Stress, Retailers Say

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    Consumer spending remains resilient, but retailers’ latest earnings offered a glimpse into worrying shifts in shopping habits.Consumers power the U.S. economy, and their capacity to spend has repeatedly defied predictions. In early 2020, after a short but severe recession caused by the pandemic, consumers splurged on big-ticket goods, from patio furniture to flat-screen TVs and home gym equipment. Then came what economists called “revenge spending,” with experiences that were off limits during lockdowns, like traveling and going to concerts, taking precedence.Now there are signs that some shoppers are becoming more cautious, as Americans’ savings erode, inflation continues to bite and other factors tighten their wallets — namely, the resumption of student loan payments in October. Financial reports from retailers — including Macy’s, Kohl’s, Foot Locker and Nordstrom — that landed this week suggest a shift is underway, from consumers buying with abandon to spending more on their needs.“Last year it was more psychological,” said Janine Stichter, a retail analyst at the brokerage firm BTIG. “But now that we’ve been dealing with inflation for as long as we have, I just think we’re getting to a point where savings are depleted.”In the aggregate, consumer spending remains solid. Retail sales in July were stronger than expected, leading some economists to raise their forecasts for economic growth this quarter. A robust labor market and rising wages have buoyed consumer confidence.But even retailers with strong sales say there are signs of economic strain among shoppers.“It is clear that the lower-income shopper, our core customer, is still under significant economic pressure,” Michael O’Sullivan, the chief executive of the off-price retailer Burlington Stores, said in a statement on Thursday. In the three months through July, Burlington’s sales rose 4 percent and its profit more than doubled.Discounters historically perform well during times of economic uncertainty as shoppers across the income spectrum look to save money. Burlington, along with Walmart, Dollar Tree and TJX, the owner of T.J. Maxx and Marshalls, all reported a rise in sales last quarter, as shoppers sought discounts on essential items like groceries, turned to cheaper private label products and reined in spending on discretionary goods.The strong performance at off-price and discount retailers stands in contrast to those at department store chains and many fashion and footwear retailers.In calls with Wall Street analysts this week, retail executives also flagged rising credit card delinquencies and higher rates of retail theft, ominous signs that consumers could be more strapped for cash.Jeff Gennette, the chief executive of Macy’s, the largest department store in the United States, said shoppers had “more aggressively pulled back” on spending in the discretionary categories, resulting in an overall decline in sales last quarter. Half of Macy’s shoppers make $75,000 or less.“They are not converting as easily and becoming more intentional on the allocation of their disposable income,” he said.“Probably the most important thing people are spending money on is general merchandise,” said Max Levchin, the chief executive of Affirm, which extends credit to shoppers at checkout via a so-called buy-now, pay-later model. “People are looking for more value for less money, or simpler functionality and lower price,” he said. The company reported an 18 percent rise in active customers from a year earlier.The finance chiefs of Macy’s, Kohl’s and Nordstrom told analysts that delinquencies on the department stores’ credit cards had risen. In Macy’s case, the increase in nonpayments last quarter was “faster than expected.”“When people are not paying their credit card bills, that suggests a really stretched consumer,” Ms. Stichter of BTIG said.And that means consumers are being more selective about where they shop and what they buy.“You’re going to see brands that are winners and losers,” Fran Horowitz, the chief executive of Abercrombie & Fitch, said in an interview. The fashion retailer reported a jump in sales of more than 10 percent last quarter, as it was able to “chase” the new styles that got more shoppers through the doors, Ms. Horowitz said.By contrast, on the same day Foot Locker reported a sales decline of nearly 10 percent for the quarter, it also cut its forecast for 2023 earnings for the second time this year, citing “ongoing consumer softness.”The back-to-school shopping season now underway is crucial for retailers, a harbinger of whether there will be strong sales for the rest of the year.And a new dynamic will soon come into play. In October, student loan payments will resume for about 44 million Americans, after a pandemic relief measure put them on hold in March 2020. Retail executives have warned that the payment resumption could further squeeze their shoppers’ budgets.Halloween, which is just weeks after repayments resume, will also be a barometer for people’s willingness to spend on discretionary items like costumes and candy, said Nikki Baird, vice president of strategy at Aptos, a technology company that works with retailers like Crocs, L.L. Bean and New Balance.She said that the repayments will most affect the age group that typically spends on Halloween. “I think that will really tell us what does this mean for the holiday season,” Ms. Baird said. “If Halloween is a bust, then I think we have to really start looking at whether consumers are going to go big for Christmas, because I think it says they won’t.” More

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    Ford Follows Tesla in Cutting Electric Vehicle Prices

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    The automaker reduced the price of the Mustang Mach-E by up to $5,900 after Tesla slashed prices of its cars by as much as 20 percent.Ford Motor said on Monday that it was cutting prices on its top-selling battery-powered model, the Mustang Mach-E, and increasing production of the sport utility vehicle. It was the latest sign of intensifying competition in the electric car market.Two weeks ago, Tesla slashed prices of its electric cars by as much as 20 percent in response to softening demand around the world.The price cuts for the two most affordable versions of the Mach-E amounted to less than $1,000 each. Other models, with longer-range batteries and premium options, were reduced $3,680 to $5,900, reductions of 6 percent to 9 percent.“We want to make E.V.s more accessible, so we’re increasing production and reducing prices across the Mach-E lineup,” Ford’s chief executive, Jim Farley, said on Twitter. He added that “with higher production, we’re reducing costs, which allows us to share these savings with customers.”The lowest-priced Mustang Mach-E — a rear-wheel-drive model with a standard battery — now has a list price of $45,995, a reduction of $900. The high-performance Mach-E GT with an extended-range battery now sells for $63,995, a cut of $5,900.Tesla’s least expensive car is the Model 3, which is smaller than the Mustang Mach-E and starts at $43,990. The all-wheel-drive Model Y, a more direct competitor of the electric Mustang, starts at $53,490. An all-wheel-drive Mustang Mach-E with comparable battery range now lists for $53,995.Electric vehicles priced below $55,000 can qualify for federal tax credits of $7,500 that were made available starting Jan. 1 under the Inflation Reduction Act. Ford’s price cuts will make more versions of the Mach-E eligible for the credit.Ford said the new prices would automatically apply to customers who had placed orders and were waiting for their cars. Ford’s credit division is also offering subsidized interest rates as low as 5.34 percent on Mach E orders placed between Jan. 30 and April 3.Tesla has long dominated the electric car market, which it largely had to itself until the last couple of years, but is increasingly encountering stiff competition. Its rate of growth has slowed in China, where its is now outsold by a local manufacturer, BYD. In addition to Ford, Volkswagen, Hyundai, Kia and other automakers have introduced electric models in the United States that are selling well and are generally cheaper than Tesla’s luxury models.In 2022, Ford sold just under 40,000 Mach-Es, about 45 percent more than in 2021. That made the Mach-E the third-best-selling electric model after Tesla’s Model Y and Model 3.For much of the last two years, Tesla, Ford and other automakers raised prices of electric vehicles because demand for battery-powered cars far outstripped supply. But demand for cars and other big-ticket goods has weakened in recent months as the Federal Reserve has raised interest rates significantly. Fed policymakers are expected to slow their rate increases at their first meeting of the year on Wednesday. More

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    Why Retailers Are Trying Extra Hard to Woo Holiday Shoppers

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    With an economic slowdown a distinct possibility, stores hope customers’ willingness to open their wallets will last through the season.Amazon held what amounted to an extra Prime Day in October, blanketing its site with deals. Best Buy rolled out Black Friday-level sales last month. And on Friday, Kohl’s entered the first 200 people to walk into each of its stores into a sweepstakes, with prizes including gift cards to Sephora and a family trip to a Legoland resort.With the arrival of the all-important holiday shopping season, retailers are not just competing with one another to attract customers. They are also competing against the clock.For now, Americans are spending, buoyed by pandemic-era savings and a red-hot labor market. But at the same time, prices are climbing at the fastest pace in decades and the Federal Reserve is attempting to rein them in by raising interest rates. That effort to curb demand by making borrowing more expensive is, in turn, making consumers pessimistic about the economy. And a recession is a distinct possibility.Retailers, some of them sitting on a glut of inventory, want to sell as much as they can while consumers are still pulling out their wallets. So they are barraging customers with discounts, hoping to entice them to buy before an economic slowdown causes a change in behavior once more.Whether retailers succeed will have profound implications. Billions of dollars are at stake, and companies will be watching the outcome closely as they make hiring and investment decisions for the new year.“We’re going to spend a lot of time right now focused on executing our plan, getting through the holiday season and then assessing the consumer and the overall retail landscape as we look to 2023,” Brian Cornell, the chief executive of Target, said on a call with analysts this month.More broadly, retail sales during the holiday shopping period could provide clues about the trajectory of the economy in the weeks and months to come.“For the overall economy, I think that it’s going to be very important to look at what the consumer is doing because really that’s going to be your key indicator,” said Lydia Boussour, an economist at EY-Parthenon. “It’s the key engine of growth.”An Express store at the Tanger Outlet in North Charleston, S.C. To entice bargain-hungry shoppers and move unwanted inventory, many companies are promoting “value.”Gavin McIntyre for The New York TimesForecasters generally believe that consumer spending, which accounts for about 70 percent of total economic growth, will remain strong in the fourth quarter, in large part because of household savings. Collectively, Americans by the middle of this year were still sitting on about $1.7 trillion in extra savings accumulated during the pandemic, based on Fed estimates, thanks in part to government aid.But in September, the most recent month for which calculations were available, Americans saved only 3.1 percent of their after-tax income, less than half the share before the pandemic. And poorer Americans are seeing their savings dwindle even faster than wealthier ones.Meanwhile, credit card balances in the third quarter swelled 15 percent compared with a year earlier, according to the Federal Reserve Bank of New York. That was the largest increase in more than two decades, as consumers increasingly rely on credit even as borrowing costs are rising.And a University of Michigan survey this month showed a sharp decline in “consumer sentiment” — a measurement of how people feel about the economy and their financial situation. Even as consumers continue to make purchases, Ms. Boussour said, “they’re feeling depressed about the overall economic situation, and they are going to grow increasingly reluctant to spend.”An employee at Bath & Body Works at Tanger Outlet greeted Black Friday shoppers. Forecasters generally expect that consumer spending will remain strong in the fourth quarter, largely because of household savings.Gavin McIntyre for The New York TimesRetail sales grew 1.3 percent in October, more than expected, as shoppers snapped up earlier-than-usual holiday deals. Some major retailers including Walmart and Home Depot reported strong third-quarter earnings, bolstered by sales for less discretionary goods like groceries or items related to home renovation and do-it-yourself projects. “Households are still spending money because they can,” said Aneta Markowska, chief financial economist at the investment bank Jefferies. “I still think there’s a lot of uncertainty about next year because the Fed obviously has raised rates very aggressively this year and we haven’t really felt the effects yet.”But several retailers said they saw demand for their products slow during the month, and when shoppers did buy, they seemed motivated by sales. Some companies have lowered their financial outlook or declined outright to provide forecasts for next year to avoid being caught flat-footed.This was not how the end of this year was supposed to be. For two holiday shopping seasons, retailers strained against pandemic disruptions. Now that the virus restrictions and supply chain snarls that defined those periods have largely abated, retailers had been expecting something of a return to normal.Instead, retailers find themselves trying to outrun a likely economic slowdown.To entice bargain-hungry shoppers and move unwanted inventory, many companies are promoting “value,” offering steep discounts and low prices more so than last year even as labor costs remain high. Many started their holiday blitzes early in the hopes of jump starting sales. Target held Deal Days in October and Old Navy rolled out a “Sorry, Not Sorry” holiday campaign. “Value clearly matters to everyone,” Corie Barry, the chief executive of Best Buy, said on an earnings call last week.J.C. Penney brought back doorbuster sales on Black Friday aimed at getting shoppers back into the store.Justin Hamel for The New York TimesAt J.C. Penney, stores returned to 5 a.m. doorbusters on Black Friday, promoting the “pre-inflation pricing” for items like Instant Pots, hair flat irons and coats.Jeff Gennette, the chief executive of Macy’s, said that a feature on its website that allows users to peruse gifts priced from $15 to $100 seemed to be particularly tempting to shoppers.“If you’ve got an item that’s competing with the competitor, and you’re a higher price, you’ve got to make those adjustments,” he said.Retailers are trying to eliminate any obstacles between a shopper and a potential purchase. Jill Timm, the chief financial officer for Kohl’s, said the chain was providing more personalized offers to shoppers, as well as clearly laying out the discount amounts on certain items to prevent customers from being confused “because they had to do math.”Kohl’s is “really making sure that the offers that we’re putting in are meaningful to the customer to drive their behavior,” Ms. Timm said.Signaling value is part of the overall strategy for Primark, an international clothing retailer, as it looks to grow its presence in the United States.In a recently opened store at a mall in Garden City, N.Y., Primark executives pointed out large signs that advertised $11 hoodies, $4 biker shorts and $20 for a baby-blue bag featuring Stitch from the Disney movie “Lilo and Stitch” — and noted that a candle, at 90 cents without any holiday discount, cost less than at Walmart.“It needs to be a very clear moment when you walk in of that perception that there is amazing value throughout the whole store,” said Kevin Tulip, Primark’s U.S. president.Shoppers seemed price conscious on Black Friday and throughout the weekend.Retailers dropped online prices for merchandise like toys, electronics and computers, according to data released on Friday from Adobe Analytics. Discounts for sporting goods and TVs were far steeper this year than last year, according to Adobe data, and clothing prices were slightly lower this year. The average discount for Black Friday deals in the United States was 30 percent, according to Salesforce. In 2019, Salesforce said, the average discount rate for Black Friday was 33 percent.In-store sales on Friday rose 12 percent from last year, and e-commerce sales increased 14 percent compared with 2021, according to Mastercard SpendingPulse data released on Saturday. Those sales included spending not just in retail stores but also at restaurants.Still, not everyone was satisfied. On social media, people complained that Black Friday deals weren’t as sizable as they expected.In San Francisco, Riz Gordon, 24, woke up at 6 a.m. on Friday to shop with her parents and younger sister. Going to the stores that day is “a long family tradition,” she said, and they had already picked out stocking stuffers and smaller presents. But inflation was on their minds.“The prices are very much different than 10 years ago,” Ms. Gordon said.On Sunday, at a Target in Springfield, Ill., D.J. Baggerly, 69, made a quick trip for one final Christmas gift: a white knitted throw blanket. She had spent the weekend mostly shopping online, working through her grandchildren’s wish list.Ms. Baggerly lives on a fixed income, and the higher prices for gas and groceries, she said, have been “ridiculous.” Asked if she planned to cut back on spending in the coming weeks, she said, “Oh yeah. I’m done.”Ben Casselman More