Economic Update: Source
It looks like the rhetoric is not softening and both sides are dug in for a fight. With the OEMs forcing more expense onto the unions with actions like GM laying off an additional 200 workers, the UAW President is ready to go all in on the strike and shut down more production facilities. The impact on new and used car supply and price will be impacted in an aggressive way if this continues. With the Biden administration just sending the hit labor secretary to Michigan. The question is, what if anything can they do to stop the impending loss of GDP?
New Day Supply: Source: Cox Automotive Data
New Car activity has been increasing over the last couple of weeks most likely due to the union strike and a decrease and price seen below for an increase in affordability. That has had a direct impact on the supply of new cars sitting around six years old when the 2019 level was around 80 days. We’re still 20 days short and pre-pandemic levels of new parliamentary in the market with the UAW strike in our backyard.
Used Day Supply: Source: Cox Automotive Data
Used car sales have been on the rise for the last few weeks and that has had a direct impact on supply. We’re sitting around 40 days now down from 50 days just a few weeks back. The price of used cars has stayed steady and softened since early June but we may see a shift in that soon. Showing just below is the 18-day supply both in years by segment but also in available five years and newer used inventory over the next 2 1/2 years.
Buy / Sell Market Trends:
The trends of acquisition cost and sales price are still steady with a $2,900 margin. That is still healthy but not likely to last long if the strike continues. Does that mean doom and gloom, actually just the opposite? We look at that below.
Talking to a well-known operator just the other day his comment was, quote this is going to be a tough market to put together.” He’s not wrong but knowing him in many of our clients they’re prepared with the right data insights, partners, and priorities to win in this market as others pull back. In our opinion the larger the margin gap the more competitive the market is and the harder it is to take market share. As these gaps start to squeeze the market becomes less competitive as others pull back. It creates a market share opportunity for those who are prepared and set up to win. Let’s hear more about how we can win today.
Listen to the replay here: https://www.clubhouse.com/invite/jYwT4rvs?fbclid=IwAR2CNBrBmUXw82z_g2iDp4SkvjA-4E3UXsjbvUiELy6ieuRn3-z4YjCKUYk
Use the AI tool to ask content questions here: “C:\Users\dblee\OneDrive\Documents\Desktop\AI Video Conveter.url”