“All Things Used Cars” Auto Market Update”

 

Economic Source

  • Consumer sentiment fell back about 10% this May following three consecutive months of very little change to its lowest reading in about five months.
  • Year-ahead inflation expectations edged up from 3.2% last month to 3.3% this month
  • Long-run inflation expectations held steady at 3.0% for the second straight month.
  • The labor market remains relatively stable, though not as strong as before the pandemic

 

Automotive Used Market Outlook: Source

  • The average age of vehicles continued to trend upward
  • According to a new report by S&P Global Mobility, the combined average age of passenger cars and light trucks has now reached a record high of 12.6 years.
  • Passenger car average age is 14 years and light duty truck is 12 years.

 

Cox Automotive’s Manheim Wholesales Market Source

  • The 3-year-old index depreciated 0.5
  • Three-year-old lane efficiency dropped back down to its typical seasonal level.
  • Six-year-old lane efficiency still running higher than the previous two years.

 

Summary: Source

  • Vehicles are older with more miles than ever before.
  • Auctions are still riddled with vehicles that need plenty of recon after buy and transport fees making it hard to profit
  • New Car Trades are averaging 50% at dealerships today
  • Fining the most DFC activity will ensure quality inventory with solid margins to stay ahead of the market.