Economic Outlook: Source

  • The overall economy is stable with employment conditions and buyer confidence in the moderate range but wages and buyer ability showing signs of strength.
  • Dealers are feeling moderately optimistic right now as tax season gives us a slight lift in sales however dealers are still feeling less optimistic than this time last year and the year before.

New and Used Retail Sales and Day Supply Trending: Source

  • Retail prices decreased slightly.
  • With less inventory, the used retail sales rate is currently running close to 2019 levels with days at 38 days.
  • New car sales continue to trend like 2019 but inventory also continues to build

Manheim Wholesales Market Source

  • The 3-year-old index moved up 0.1% to 102.1%. Luxury decreased 0.2% and non-luxury increased 0.2
  • Wholesale values started decreasing for the older model year.
  • Sale prices slightly below MMR (-0.64%)
  • Lane efficiency is starting to drop some.

Black Book: Source

  • Car segment increased +0.10% up .8% week over week.
  • 8-to-16-year-old Cars increased +0.18%.
  • Truck segment increased +0.24% matching +0.24% last week.
  • 8-to-16-year-olds increased by +0.13% on average.

Summary:

According to Cox Automotive’s recent dealer survey, the top three things that dealers feel are holding back growth are interest rates, the economy, and market conditions. The political environment and expense structure along with consumer credit availability come in next. With limited used car inventory, margins are compressed but consumer confidence is up. Holding inventory, it’s not favorable in this market and inventory turn is where marginal profits can be made and losses avoided.

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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