“All Things Used Cars” Auto Market Update

 

 

Economic Automotive Outlook: Source  

Inflation numbers are out today and from this chart it is hard to avoid the conclusion that inflation is accelerating, driven by services. As we discussed last week, it looks to be a condition that will eventually cause a rapid deceleration in demand due to affordability which may lead to an inflationary spiral that will then lead to rate cuts to curb the impact. Most of which, IMO, simply states, that the Feds and this Admin had no clue what they are doing.

Cox Automotive’s Manheim Wholesales Market Source

    • Decelerating, the 3-year-old index depreciated 0.3% and higher for newer model years.
    • Five and eight-year-old vehicles increased week over week.
    • Lane efficiency decreased some for 3-year-old models and increased for 6-year-old models.

Retail Trending: Source

  • According to Edmunds, Q1 2024, new car transactions had a trade-in 49% of the time on average Avg Trade in age was 6.1 years compared to 5.3 years in Q1 2022 average trade-in age for used vehicles increased to 9.4 years in Q1 2024, compared to 7.9 years in Q1 2022
  • The used retail sales rate is trending similar to most previous years; days’ supply moved up to 43 days.

Summary: Source

Vehicle Sales Estimates:

  • Retail vehicle sales are on an uptrend, with new-vehicle sales up by 2% in the latest week and a 5% year-over-year increase.
  • Similarly, used-vehicle sales have seen a 2% week-over-week increase and a 7% rise compared to the previous year.

Supply and Demand:

  • Supply dynamics show a year-over-year increase in new vehicle supply by 23 days, though there was a 3% week-over-week decrease.
  • Used vehicle supply saw a minor decrease both year over year and week over week.

Leading Indicators:

  • A recent Cox Automotive report provides how overall leads and unique credit applications per dealer showed mixed trends, while service appointments were down by 4% year over year.
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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