Economic Update:

  • Consumer sentiment dropped again last week.
  • Morning Consult’s report shows that interest rates and higher gasoline prices drive that trend.

Retail Sales Trending

  • October’s total new-light-vehicle sales were up 1.5% year over year, with one less selling day.
  • October new vehicle sales were down 9.6% month over month.
  • Used-vehicle retail sales in October were down 2% compared to September.
  • Used retail sales are estimated to be down 4% year-over-year when October closes.
  • The average retail listing price for a used vehicle declined 0.7% over the last four weeks.

 

Day Supply: Source: Cox Automotive Data

  • The day supply for the new trending up significantly from week 41 to 45.
  • Build-up pre-strike and affordability have helped that trend.
  • The used supply has stayed very steady over the last 35 to 45.

 

Retail Price Trends: Source

  • In every other category, the change in price month-over-month was not much more than about $100.
  • Vans & Minivans are down $150 over last month.
  • SUVs and Cars are down by roughly $100.
  • Hybrid and EV prices seem to have bottomed out and are down only about $85 from last month.

 

Wholesale Market Trends: Source: Cox Automotive Data

  • In October, Manheim Market Report (MMR) values saw above-average weekly declines.
  • Over the last four weeks, the Three-Year-Old Index declined by 3.6%.
  • The average daily sales conversion rate dropped to 52.9%, which indicates dealer demand has declined.

Summary:

  • We are in a highly depreciable market, so all acquisition channels are losing value the minute we take ownership.
  • Maximizing each lead and each opportunity is imperative as inventory turn is the best way to avoid losses and grow departmental profit in a market like this.
John Ellis CEO & Founder of The Automotive Advisor Team, LLC

Author: John Ellis

Founder & CEO The Automotive Advisor Team, Inc. BEVEveryting, Inc. Double E Consulting, Inc.

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