Overall wholesale values last month came in at $14,559, down 11.7% from the April 2023 average of $16,468, according to the report. Prices were down 0.3% from March, when wholesale values averaged $14,603.

For the week ending May 19, the average wholesale price dipped to $14,540, the report noted.

“Wholesale prices were slightly down in April, indicating a plateauing spring market that has continued into May,” Kontos said in the report.

“Prices for late-model vehicles have generally held up better than overall prices, as dealers seek to find affordable substitutes for expensive new vehicles on behalf of their customers.”

Average late-model vehicle prices came in at $24,901 for April, according to the ADESA report, and moved upward to $25,762 for the week ending May 19.

Kontos explains that late-model vehicle values had a more rapid rise than the overall market through March as well as a steeper descent in April.

But their prices have “firmed” this month, he said.

On the retail side, J.D. Power said in data released Thursday that used-car prices have averaged $28,470 this month. That’s down 5.4% year-over-year.

“The decline in used-vehicle values is translating to lower trade-in equity for owners, now trending towards $7,866, which is down $1,438 from a year ago,” said Thomas King, president of the data and analytics division at J.D. Power, in a forecast.

The post How used-car prices are faring this month in wholesale, retail markets appeared first on Auto Remarketing.

Automotive photo, video and data collection company Redline decided to find out, and its recent survey showed consumers believe it’s very important.

The survey of 372 adults — including respondents who indicated they had shopped online for a vehicle in the past three years — found 95% of the respondents believe professional-looking photographs of vehicles on a dealership’s website significantly increase the perceived value of the vehicles.

The survey also showed 87% of consumers would click on a vehicle with a clear, well-lit, well-framed photo over one with a blurry, poorly lit or poorly framed photo. And 57% of car shoppers think a dealership featuring professional images would need to engage in less price negotiation.

Redline said those perceptions indicate “high-quality images attract potential buyers and empower dealerships to maintain their pricing integrity, leading to improved profit margins.”

According to Redline’s study, 94% of respondents expressed a preference for clicking on professional-looking photos first when browsing online inventories, which the company said shows “the critical role” of visual in capturing consumer attention in the competitive digital marketplace.

“Our survey demonstrates professional vehicle photography is not just about aesthetics. It directly influences consumer trust, confidence and ultimately a dealership’s bottom line,” Redline CEO Mike McGlade said in a news release. “By investing in high-quality images, dealerships can enhance their online presence, attract more serious buyers and achieve higher profit margins.”

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And although there’s room for improvement, dealers are improving the customer experience in the service department.

Both are good signs, given what S&P Global Mobility discovered about the average age of vehicles on the road.

At 12.6 years, the average age of vehicles in the U.S.  in 2024 is at an all-time high, the company said Wednesday.

What’s more, the population of vehicles in the 6- to 14-year-old age group — which S&P Global Mobility called the “sweet spot” for vehicle service — is expected to climb, while numbers for vehicles newer than 6 years old have slowed.

“With average age growth, more vehicles are entering the prime range for aftermarket service, typically from 6 to 14 years of age,” said Todd Campau, aftermarket practice lead at S&P Global Mobility, in a news release.

“With more than 110 million vehicles in that sweet spot — reflecting nearly 38 percent of the fleet on the road— we expect continued growth in the volume of vehicles in that age range to rise to an estimated 40 percent through 2028,” Campau said.

In January, there were 286 million vehicles in operation in the U.S, versus 284 million a year ago.

Less than 90 million of those 286 million are younger than 6 years old, S&P Global Mobility said. It will likely be 2028 before that age group hits that mark again, the company said.

That’s quite a change from pre-COVID times, when there were 98 million vehicles less than 6 years old in the U.S. vehicle population in 2019.

But those “historically high volumes” of younger vehicles have gone in reverse thanks to the COVID-induced supply chain impacts, the company said.

S&P Global Mobility anticipates that for the next five years, about 70% of the vehicle population will be at least 6 years old.

The aging vehicle fleet was also evident in trade-in data from Edmunds.

“How do we know that consumers have made a return en masse? Look no further than an increase in average trade-in ages,” Edmunds director of insights Ivan Drury said in an analysis last week.

“In 2022, new-car inventory constraints forced many would-be buyers with prospective older trade-in vehicles to sit out the market and even had some traditional new-car buyers resorting to used. But as 2024 resembles a more familiar market, trade-ins of older vehicles have begun to return,” he continued.

“In Q1 2024, the average trade-in age for new vehicles climbed to 6.1 years compared to 5.3 years in Q1 2022. The average trade-in age for used vehicles increased to 9.4 years in Q1 2024, compared to 7.9 years in Q1 2022,” Drury said.

Older vehicles have seen growth in the auto auction lanes, as well.

While sales of 1-3-year-old vehicles last month climbed 15% from April 2023, all age bands climbed double-digit percentages year-over-year, according to AuctionNet data from the National Auto Auction Association.

The scope of that growth included a 17% year-over-year gain for vehicles 11 years and older down to an 11% hike for 4-6-year-old vehicles.

The post In good sign for service departments, age of vehicle population hits all-time high appeared first on Auto Remarketing.

And that’s to be expected, says Cox Automotive.

The company said in a Data Point report last week that independent and franchised dealers combined to sell 1.45 million used vehicles last month, which beat April 2023 by 4.8% but was a 7.0% month-over-month decrease.  The sales estimate is based on Cox Automotive’s vAuto Live Market view data.

What’s more, the past five Aprils have had average sales volumes of 1.56 million, Cox said.

Through four months of the year, there have been 5.72 million used-car sales by dealers, compared to 5.63 million through April 2023.

“As tax refund season winds down, it’s normal to see consumer demand for used vehicles back off in April, and that’s what we experienced this year as well,” Jeremy Robb, who is Cox Automotive’s senior director of economic and industry insights, said in a news release. “With interest rates remaining elevated, consumers need a bit more of a push to buy at this time of year.

“While prices were lower against 2023, it was enough to attract more buyers from the sidelines at this point,” Robb said. “Used retail sales were higher against last year’s levels, but tight inventory and affordability issues continue to be a challenge for the industry.”

CPO sales sluggish

The certified pre-owned segment of used-car retail was also a challenge.

Cox estimates there were 209,265 CPO sales in April, which is down from 214,684 certified sales in April 2023 and 231,927 CPO sales in March. That represents a month-over-month decline of 9.8% and a year-over-year slowdown of 2.5%.

Through four months, year-to-date CPO sales are up 0.2%, Cox said.

Used-car supply trends

Cox provided further details on the used-car supply picture in a separate Data Point report Friday.

As of May 2, there were 2.27 million used vehicles on dealership lots, which beat prior-year figures by 6%. It also beats the 2.22 million at the beginning of April.

Days’ supply of used vehicles was at 46 at the beginning of May, compared with 45 to begin April and even with year-ago figures, Cox said.

And while used-vehicle prices have trended downward this year, the lowest-priced vehicles are the hardest to find, the company said in the report.

“Used cars below $15,000 continue to show constrained availability with only 36 days’ supply, 22% less than all other price ranges. Affordability remains challenging for consumers, and supply is more constrained at lower price points,” Cox said.

Vehicles are also turning more quickly. In its Market Insights report released Tuesday, Black Book said retail used vehicles are currently turning in about 40 days. Earlier this year and late last year, used-car turn rates had eclipsed the 60-day mark at certain points, the data shows.

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Mine is The West Wing. The writing is phenomenal. The acting is outstanding. And, as you might know, I love politics.

An episode titled “Constituency of One” follows deputy chief of staff Josh Lyman after he is dubbed the “101st Senator” because of his success in convincing politicos in Washington to see things his way. Legend has it Lyman once sent a congressman a dead fish to help motivate him.

Lyman downplays the hubbub, telling West Wing staffers they serve a constituency of one, that being the President of the United States. One staffer immediately pushed back and said she also serves a constituency of one — herself.

I have thought about the meaning of “constituency of one” over the course of my career.

I have worked for politicians, engaged politicians in professional and personal settings, and may have even been considered a politician at one point in time.

After decades of meetings with individuals and entities while in government service and while representing individuals and entities before government bodies, I have come to the same conclusion that fictional White House staffer did. Ultimately, we are all constituencies of one, to ourselves and our businesses.

Think about the idea of your business being a constituency of one. What does that mean to the dealership? Why is that important? What should you do to represent your constituency of one?

Being a constituency of one means you each have a story to tell.

You know your business. You know your business’s impact on your employees, on the economy and on your community. You know the day-to-day challenges dealerships face. You know how your dealership fits into the larger automobile retail industry.

Who better to tell this story — your story — than you?

I can assure you government officials want to hear from you. They need to hear from you. Think about the litany of issues your city council members, county commissioners and congressional representatives have on their plate at any given time.

When you think about the number of issues they face, their knowledge is often a mile wide and an inch deep. They need you to provide the substance of understanding.

Perhaps you’re wondering if your engagement will make a difference. Let me share a few examples of how the voice of the dealer has made a difference over the years.

It’s the dealer voice that has repeatedly pushed back against proposed legislation that would prohibit the sale of vehicles with open recalls.

It was the dealer voice that led to the revocation of the Consumer Financial Protection Bureau’s flawed guidance on dealer-assisted financing.

It was the voice of the dealer that led Congress to revoke the CFPB’s ill-conceived, anti-consumer arbitration rule.

It was the voice of the dealer that kept 100% deductibility of floorplan interest expenses in the Tax Cuts and Jobs Act.

It was the voice of the dealer that helped defeat overreaching buy here-pay here legislation in Oregon.

And more recently, it was the voice of the dealer that convinced federal, state and local governments that automotive sales and service were essential businesses to remain open during the pandemic.

This is far from a complete list, but these things don’t happen without you telling your story.

How do you get started? Reach out to your local, state and federal elected officials. Invite them to come by the dealership and see first-hand what you do and how you do it.

I would also encourage you to get involved in your dealer associations. Consider contributing to their political action committees, which support candidates for office who will champion our industry.

One final piece of advice — leave the dead fish at home.

Shaun Petersen, executive vice president and chief legal officer of Buckeye Dealership Consulting, is a former Ohio senior deputy attorney general who has previously served the auto industry as an attorney representing dealers and as senior vice president of legal and government affairs for the National Independent Automobile Dealers Association.

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To thrive in this competitive landscape, auto dealers must embrace technological advancements, particularly artificial intelligence (AI) and predictive modeling, to navigate inventory risks effectively and drive sustainable growth.

Q1 sales & inventory data

These advanced technologies are growing in importance because of the state of auto sales, as well as the need to better manage inventory risk.

Auto sales volume in April dropped for the first time in 20 months for carmakers, slipping 3.9% to 1.32 million on the month, compared with the same month last year.

The seasonally adjusted annual rate of sales in April was recorded at 15.7 million vehicles, near the bottom of the range of forecasts — 15.6 million to 16 million — according to projections from J.D. Power/GlobalData, Cox Automotive and S&P Global Mobility.

Dealers are slowly realizing that the days of easy profits have come to an end. Following the pandemic, the shortened supply of new vehicles put dealers in the drivers’ seat, controlling much of the pricing and profit on each transaction. However, with inventory levels now back to near-pre-pandemic levels, they are realizing they’ve lost much of this power.

What can dealers do to combat this? Smart retailers are turning to advanced inventory risk management technologies and reporting that give them never-seen-before insight and visibility at the vin-level of their inventory levels.

This sophisticated data is now packaged up and reported for use by dealers. As an example of this level of data, new vehicle inventory reached 80 days’ supply at the end of the first quarter. Forty-eight percent of new inventory was considered aged (ending over 45 days), with 50% of new carryover inventory during the quarter, 19% of new inventory sold with a markdown, and 63% of new inventory listed as unviewed online.

On the used side of the lot, inventory was just 40 days’ supply at the end of the first quarter. Forty-six percent of used inventory was considered aged, with 56% of used carryover inventory during the quarter, 35% of used inventory sold with a markdown, and 52% of used inventory listed as unviewed online2.

Greater insights into inventory risk management

Retailers now have access to monthly analytics that offer deep real-time data and insights visibility into the trends shaping OEM-specific and dealership inventory for both new and used vehicles, as well as key data on vehicle pricing and markdowns.

The data serves as a detailed comparative analysis that shows how each OEM is performing against industry benchmarks, so dealers can see where they rank amongst their competition. This approach not only highlights relative performance metrics but also demonstrates where buyer demand is. It also shows how their data has changed each month, month over month, and quarter over quarter.

This level of insight has never been available before because dealers now have access to comprehensive, market and competitive data for every vehicle on their lot, enabling dealerships to easily inform strategy and decision making for each VIN or vehicle segment (ex: condition, body style, model). The insights can answer questions about a dealer’s inventory down to the VIN level to help them make strategic decisions and seize new opportunities.

By leveraging this new level of reporting and staying informed on the trends shaping inventory, pricing, and markdowns, auto retailers can swiftly adapt and make informed decisions. This visibility enables agile responses to local and tier-two market changes, optimizing inventory management, pricing strategies, and ultimately, driving a distinct competitive advantage in the dynamic automotive market.

The role of inventory risk management in today’s auto dealerships cannot be overstated. In a rapidly evolving market characterized by shifting consumer preferences, intense competition, and economic uncertainties, effective inventory management is the backbone of dealership success. By embracing VIN-specific insights powered by AI and predictive modeling, auto dealers can gain a competitive edge by truly optimizing inventory assortment, mitigating risks, enhancing the customer experience, and driving sustainable growth. The future of auto retail belongs to those who harness this level of reporting and the power of AI to transform their inventory management practices and unlock new opportunities for innovation and profitability.

Jason Knight is the chief executive officer of Lotlinx, which offers an inventory platform that enables dealers to automatically adapt to market dynamics, mitigating inventory risk through VIN-specific strategies.

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What could be most beneficial for dealerships of all stripes is getting a boost of older, more affordable vehicles. Drury cited a variety of positive data points as reasons why via his analysis of the first quarter.

“The return of holdout buyers should help bolster the supply of more affordable, older used vehicles. In Q1 2024, new car transactions had a trade-in 49% of the time on average, while used had a trade-in 31% of the time on average,” Drury said in this report Edmunds posted on Tuesday.

“Within this pool of trade-ins, we’re also seeing that the consumers with older trade-in vehicles have a preference for buying a newer used vehicle instead of an outright new one. Right around the vehicle trade-in age of 9 years, we observed a perfect 50/50 split in customers either buying a new vehicle or buying a newer used vehicle. Vehicles older than 9 years were more likely to be traded in for a used vehicle,” he continued.

Drury acknowledged consumers have been in “hibernation” for several years as the combination of high vehicle prices and interest rates kept potential buyers out of showrooms. But with cooling prices and increased new-vehicle supply, Drury emphasized the scene is getting better for used-car departments.

“How do we know that consumers have made a return en masse? Look no further than an increase in average trade-in ages,” Drury said.

“In 2022, new-car inventory constraints forced many would-be buyers with prospective older trade-in vehicles to sit out the market and even had some traditional new-car buyers resorting to used. But as 2024 resembles a more familiar market, trade-ins of older vehicles have begun to return,” he continued.

“In Q1 2024, the average trade-in age for new vehicles climbed to 6.1 years compared to 5.3 years in Q1 2022. The average trade-in age for used vehicles increased to 9.4 years in Q1 2024, compared to 7.9 years in Q1 2022,” Drury went on to say.

But not every single part of the used-car retailing scene is rosy.

Edmunds’ data showed average transaction prices for used cars retailed in Q1 came in at $27,113. While that’s down 4.5% year-over-year, it’s a whopping 33.9% above the reading in Q1 of 2019 when Edmunds pegged it at $20,247.

Still, Drury pointed out that the average days to turn for used vehicles dropped to 37 days in Q1; the same as Q1 of last year.

What does it mean for used-car sales? Drury put it this way.

“Consumers making their way back into the market after a number of years away are likely experiencing some sticker shock when shopping for new vehicles and therefore more thoroughly evaluating their purchase options,” Drury said. “But the majority of new vehicles are far less likely to appeal to these buyers — they’ve waited for years to make a move and are likely a bit more price-sensitive than the consumers who were willing to pay above MSRP at the height of the shortages.

“Until new-car incentives make a real comeback, used vehicles will continue to offer what new vehicles cannot: affordable transportation,” he went on to say.

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In part as a result of social media videos showing how to steal Kia and Hyundai vehicles, cars from those manufacturers have jumped to the top of the list of America’s most stolen vehicles, compiled annually by the National Insurance Crime Bureau.

Six of the top 10 theft targets in 2023 were Hyundai or Kia models, NICB’s latest report found, including the top three – the Hyundai Elantra, with 48,445 reported thefts, Hyundai Sonata (42,813) and Kia Optima (30,204).

NICB said that broke a “years-long trend” of pickups topping the list.

The Chevrolet Silverado 1500 full-size pickup, which had been No. 1 in 2022, fell to fourth at 23,721 reported thefts, followed by the Kia Soul (21,001), Honda Accord (20,895), Honda Civic (19,858), Kia Forte (16,209), Ford F-150 series pickup (15,852) and Kia Sportage (15,749).

The rankings follow NICB’s trend analysis, released in April, that showed a record 1,020,729 total thefts reported in 2023, continuing a nationwide surge in vehicle thefts since the beginning of the COVID pandemic in 2020. That report showed California led all U.S. states with 208,668 reported thefts – more than 20% of the nation’s total.

NICB said more than 85 percent of passenger vehicles reported stolen were subsequently recovered by law enforcement or other means, with 34 percent recovered within a day of the vehicle being reported stolen and 45 percent recovered within two days.

“These rankings highlight the persistent threat of vehicle theft across the country,” NICB president and CEO David Glawe said. “NICB works with law enforcement agencies and industry partners to deploy advanced technologies and strategies to combat vehicle theft from organized criminal networks and individuals. Even as we work to deter crime, it is crucial for owners to remain vigilant and take proactive measures to protect their vehicles.”

NICB said it’s coordinating efforts by all auto manufacturers to identify vehicles frequently stolen in order to reduce vehicle theft, and is partnering with state and federal law enforcement agencies to disrupt criminal networks and help recover stolen vehicles for member companies.

It also participates in federal, state and local task forces, fusion centers and intelligence groups to deter vehicle theft and works strategically with lawmakers and regulators in all 50 states to boost efforts by insurers and law enforcement to fight insurance fraud crime trends.

NICB offered several recommendations to help prevent vehicle thefts:

• Park in well-lit areas.
• Close and lock all windows and doors when you park.
• Hide valuables out of sight, such as in the glove box or trunk.
• Do not leave your keys in your vehicle.
• Do not leave the area while your vehicle is running.
• If your vehicle is stolen, call law enforcement and your insurer immediately. Reporting a vehicle as soon as possible after it is stolen increases the chance of recovery.

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That’s according to respective wholesale car market analyses by the National Auto Auction Association and Cox Automotive.

NAAA’s AuctionNet data shows there have been 32,200 BEV sales at auction year-to-date through April, which is a 93% increase.

There were close to 9,000 BEV sales last month, which NAAA said is up 124% year-over-year and even with March.

Through April, the leader in the clubhouse for EV sales at auction has been Tesla (18,500), NAAA said in its AuctionNet reporting.

Second in volume is Chevrolet (2,690), followed by Nissan (2,220), Ford (1,550) and Hyundai (1,530).

For April, these were the top five BEV models sold at auction, per AuctionNet data:

—2021 Tesla Model Y 4D SUV Long Range 100 kWh (641 units sold)

—2021 Tesla Model 3 4D Sedan RWD Standard Range Plus 62 kwh  (450)

—2021 Tesla Model 3 4D Sedan AWD Long Range 75 kWh (263)

—2018 Tesla Model 3 4D Sedan AWD Long Range 75 kWh (250)

—2018 Tesla Model 3 4D Sedan RWD Long Range 75 kWh (229)

Further underscoring the wholesale volume potential for EVs: Cox Automotive said its Manheim Marketplace sold about 48,000 electrics last year. Not only was that a 58% increase from 2022, Cox anticipates its EV sales could double this year.

So, what are these vehicles fetching in the auction lanes?

Wholesale prices for EVs fell 17.5% year-over-year in April on seasonally adjusted basis, according to analysis around Cox’s Manheim Used Vehicle Value Index.

That compares to a 13.1% decline for non-EV values and a 14% drop for the overall wholesale market, Cox reported.

EV values were down 2.6% month-over-month in April, compared to a 3.0% decline for non-EVs.

The year-over-year price declines in EVs also outpaced non-EVs and the overall industry in March, February and January, the Cox data shows.

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Not according to the latest study conducted by Urban Science and The Harris Poll.

The 2024 Urban Science Dealership Transformation Index polled 3,005 U.S. car buyers in three “key dimensions” — dealer relevance, trend resistance and actions — to measure customer perception of dealers.

The study also surveyed 250 franchise dealers to compare their views with those of their customers.

The results show the dealership’s importance is rising, as measured on a 100-point scale called the DTI score.

Scores less than 45 are considered “critical”, 45-54 is “weak”, 55-64 is “average”, 65-74 is “strong” and 75 or more is “resilient”.

The overall score — an average of the three categories — was 56, up one point from the 2023 study. Urban Science said that positive progression “promotes consideration, trial and positive customer interactions, fostering short- and long-term service and sales loyalty, and in turn business relationships that promote healthy dealerships and retail networks.”

The relevance score rose two points year-over-year to 62, edging closer to the “strong” range. Most significantly, that score took a giant lap among the youngest consumers in the survey (Generation Z) soaring seven points to a strong 67, indicating “a growing openness to dealer guidance as this cohort continues to gain purchasing power.”

Specifically, 51% of Gen Z car buyers strongly agreed today’s dealers provide the resources, tools and tech to make buying a vehicle easy and convenient, an increase of 19 percentage points, and 46% believe dealers play an essential role in the car-buying journey, a 14-point jump.

Overall, 43% of auto buyers strongly agreed dealers play an essential role in the new-car-buying journey, up four points, while 74% of dealers strongly agreed, marking a 31-percentage point gap.

In addition, 38% of car buyers strongly agreed traditional dealerships are optimized for the future, an 11-point increase from 2023, as did 48% of dealers, up 17 points.

The action score, which describes what auto buyers are doing or considering regarding vehicle purchases, rose one point to 54, and the survey results showed car buyers of all generations still overwhelmingly prefer traditional in-person purchasing over other options, though non-traditional dealerships gained five percentage points over 2023.

Asked which buying format they would consider, 91% selected in person at a traditional dealership, followed by fully online from a dealership website (67%), fully online from an OEM website (59%), and non-traditional dealership (57%).

As to where they’re considering buying from, manufacturers’ dealerships led with 80%, ahead of independent used dealerships (35%) and national used dealerships such as CarMax and Carvana at 32%, up seven points YOY.

The survey showed electric vehicle owners (58%) are twice as likely as gas vehicle owners (29%) to strongly agree they are open to purchasing a vehicle fully online.

The overall trend resistance score, which measures car buyers’ reluctance to try new innovations in automotive retail, fell one point to 52, which Urban Science said “signals a change in auto-buyer behavior toward embracing digital platforms and shared mobility options.”

The survey found 33% of auto buyers strongly agreed they are open to purchasing a vehicle fully online from vehicle selection through contracting/purchasing (up three points), with millennials leading the way at 46%, followed by Gen Z (38%), and 20% strongly agreed owning a personal vehicle is not as important as it used to be, an increase of four percentage points Urban Science called “significant.”

Regarding EVs, 47% said dealers are keeping up on understanding and advising on the EV market. Boomers had the strongest agreement at 58% and millennials (34%) the weakest.

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Over 4% of Carvana’s sales in the first quarter were battery-electric vehicles, more than doubling their share of sales from Q1 2023, according to a study released Wednesday by the online used-car retailer.

Specifically, BEVs represented 4.3% of Carvana’s sales in Q1, up from 1.8% a year earlier.

And while in the overall used-car market, BEVs commanded less than 1% share of sales for full-year 2023, 7.6% of new-car sales last year were BEVs, compared to 5.8% in 2022, Carvana said, citing Kelley Blue Book and MarketCheck data.

And that means more used EV supply in the future.

“The significant, multi-year growth in new EV sales is a leading indicator of the potential of the used EV market,” Carvana CEO Ernie Garcia said in a news release.

“As a larger selection of EVs makes its way into the used fleet, prices normalize, and tax credits become available, more used car buyers will have the opportunity to access the EV category.”

To Garcia’s point, average used BEV sale prices at Carvana were $31,000 in Q1, down 16% year-over-year.

And the gap between the prices of used BEVs and used internal-combustion vehicles has also narrowed at Carvana. In Q1, BEVs were $7,000 more expensive than ICE vehicles; that’s down from a $13,000 gap a year ago.

Additionally, the company said that 24% of its first-quarter EV and plug-in EV sales qualified for the Federal Used Clean Vehicle Credit.

“Carvana has always sought to build an inventory that matches the tastes and preferences of our customers,” Garcia said. “While we maintain a diverse selection across all fuel types, we are proud to now offer more than 50 different models of EVs at a wide range of price points.”

Elsewhere, average list prices (ALP) for used EVs ($37,200) on the CarGurus platform fell 19.3% year-over-year in April, while the amount of used EVs listed climbed 29.6%, the company said in its Intelligence Report for April.

What’s more, all 10 of the used-vehicle models with the largest year-over-year price declines were EVs. And all 10 had price drops north of 30%, according to CarGurus.

Granted, the year-over-year declines in used EVs have mostly slowed since July, and April was the first time in six months that used EV prices climbed month-over-month, the company said.

Still, it appears consumers are in a much better position with certain used EV models.

“The influx of 30,000 used EVs from fleet providers like Hertz in 2024 could lead to further price reductions for specific models,” CarGurus director of industry insights Kevin Roberts said in a recap of the report.

“It’s important to note, though, that the price declines appear to be having a positive impact on some models. For example, the Tesla Model 3 had an ALP of $43,289 at the start of 2023 and spent 81 days on the market (DoM),” Roberts said.

“By the end of April 2024, the ALP had dropped to $26,396, a decrease of 39%. Correspondingly, the DoM fell to under 49 days, representing a drop of 38.6%,” he said. “By comparison, for overall used vehicles, the ALP declined just 3.6% and DoM declined 13.3% over the same period. This suggests that the price declines are stimulating interest in select used EV models.”

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In fact, Cox Automotive’s Manheim Used Vehicle Value Index for the month fell below 200 for the first time in more than three years.

The company said in a Data Point report accompanying the index that wholesale vehicle prices were down 14.0% year-over-year and 2.3% month-over-month, when adjusting for mix, mileage and seasonality.

Unadjusted, prices fell 11.9% year-over-year and 0.6% from March.

The index reading (198.4) was the lowest it has been since March 2021, when it came in at 195.4, according to Cox Automotive’s data.

In addition to the overall decline of 14%, there were year-over-year decreases across the board in selective market classes.

Compact cars (down 17.6%) had the heftiest decline, followed by midsize cars (down 16.8%) and pickups (down 15.2%), Cox said. SUV/CUV prices were off 14.6% year-over-year and luxury prices fell 12.9%.

The decline for non-electric vehicles was at 13.1%, while EV values dropped 17.5% from April 2023.

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The company called its Vincensus Report “the most comprehensive monthly/quarterly inventory report in the industry” and said each month and quarter the report will “offer deep real-time data and insights visibility into the trends shaping OEM-specific and dealership inventory for both new and used vehicles, as well as key data on vehicle pricing and markdowns.”

Vincensus is a syndicated report designed to demonstrate the state of automotive inventory across major OEMs and serve as a detailed comparative analysis that shows how each OEM is performing against industry benchmarks so dealers can see where they rank among their competition.

That approach, Lotlinx said, not only highlights relative performance metrics but demonstrates where buyer demand is, and shows how the data changes month over month and quarter over quarter.

“Real-time data and insights for new and used OEM-specific inventory is paramount in today’s auto dealership landscape,” Lotlinx executive chairman Len Short said in a news release. “By leveraging our new Vincensus quarterly and monthly reports and staying informed on the trends shaping inventory, pricing and markdowns, auto retailers can swiftly adapt and make informed decisions.

“This visibility enables agile responses to local and tier-two market changes, optimizing inventory management and pricing strategies, and ultimately driving a distinct competitive advantage in the dynamic automotive market.”

The inaugural Vincensus Report, available for download here, shows used vehicle sales volume in the first quarter of 2024 was up 11% from the previous quarter – not surprising since demand rose 19% in that span – while inventory dropped to 40 days’ supply, down by nine days.

The data also showed 46% of used inventory was considered aged, with 56% of used carryover inventory during the quarter (a 6% QOQ increase), 35% of used inventory sold with a markdown and 52% of the used inventory listed was not viewed online.

On the new-car side, sales were down 2% while days’ supply jumped by 10 days to 80 and carryover was up 10% to 50%, with 63% of listed new inventory unviewed online.

Lotlinx said the report was developed using its proprietary Lexaca data, using than 24 billion data points and machine learning models that have been evolving for the past 10 years.

The post Lotlinx launches Vincensus Report for monthly/quarterly look at market data appeared first on Auto Remarketing.

We didn’t particularly like it, but it was necessary.

Here’s the good news: It worked. Even better news: Customers still prefer to come to dealerships to complete their transaction. In 2023, only 7% of transactions were completed 100% online.

Still, there is bad news: Our online and showroom processes aren’t in sync. Why? Because we haven’t updated our showroom process. Buyers should be able to show up at the dealership needing only to answer a few more questions to finish their purchase. We’ve already adjusted our online process to answer the questions shoppers used to ask in the showroom:

• What’s the best price?
• What’s the trade-in value?
• What do you want your payment to be?
• What’s your down payment?

This is the main reason email inquiries and phone sales have dropped. Most of a dealer’s leads are simply customers asking “is it still available?” We’ve already told them that online. However, we still have our BDCs and showroom process built to anticipate addressing these questions in person.

Here’s the worst news: We don’t give shoppers the information online they’re looking for today. We are still using generic, VIN-populated descriptions that simply list standard equipment. Buyers today already know that vehicles come with air conditioning, power windows, locks, tilt steering wheel and cruise control. The ironic part is, if your description didn’t list that info, shoppers can find that same info in 5 other places on your listing.

Don’t believe me! Look at your listings the way car shoppers will. The pandemic has caused customers to be more conservative with their spend in the “new normal” than before the pandemic.

Today’s car shoppers have “Future Cost” questions they want answered:

• Where did you get the car from?
• What was it used for?
• Was it well taken care of?
• What did you find wrong with it, if anything?
• What did you fix?
• Did you replace the brakes?
• Did you replace the tires?
• Does this vehicle come with any kind of warranty?

There are two things we need to look out that will help us figure out how to reinvent our communication processes:

1. Our online listings need to answer the “Future Cost” questions buyers are asking today.
2. And our showroom, BDC and sales processes need to account for the buyers’ increased pre-contact knowledge. Make sure your salespeople are educated on a vehicle’s history including ownership, service, and any reconditioning done at your dealership. That will get the job done.

–Just The Fax

By Robert Grill, Carfax Senior Partner Development Manager

Read Just The Fax on Auto Remarketing | Follow Our Podcast | Email Bob Grill

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However, there are deals to be had in the used-car market for alternative-fuel vehicles — even beyond government rebates — that could help dealers overcome those shopper objections.  In fact, used hybrids may be a better deal than gas vehicles in terms of average overall cost-effectiveness.

In a study, iSeeCars.com examined data from more than 1.3 million transactions of 3-year-old used vehicles between November 2022 to April 2023 and determined average cost per 1,000 miles per year for various segments and models.

What iSeeCars found was that the price per 1,000 miles per year for 3-year-old hybrids ($3,056) was 2.1% lower than that of gas cars ($3,123).

Electrics ($5,108) and plug-in hybrids ($4,351), though, were much more expensive than gas vehicles: 63.6% and 39.4%, respectively.

“Everyone knows electric vehicles cost more than gasoline, hybrid, and plug-in hybrid models,” iSeeCars executive analyst Karl Brauer said in the analysis. “But when we combined their list price with the low use rate for EVs and compared those figures to other vehicle types, we were able to quantify exactly how much more electric vehicle buyers are paying, only to drive them less.”

Gas cars were driven an average 12,813 miles per year, while EVs were driven 20% less at 10,256 miles per year, according to iSeeCars. Plug-ins were driven 4.8% less than gas vehicles (12,199) and hybrids were driven 12,471 miles, just 2.7% less.

The latter is the more cost-effective option, iSeeCars said, given that “hybrid owners use their cars at almost the same rate as gasoline cars, while their average price is slightly lower than gasoline models,” the company said.

“Hybrids have become increasingly popular with consumers in recent years,” said Brauer. “And now many mainstream models, including the newest Toyota Camry, are only sold as a hybrid. This technology is set to become the dominant drivetrain throughout the industry.”

And perhaps the most affordable alt-fuel choice.

iSeeCars listed the 15 least expensive 3-year-old alt-fuel vehicles based on price per 1,000 miles per year. Thirteen of those vehicles are hybrids and two are plug-in hybrids.

“The price increase between hybrids and traditional gasoline models keeps dropping, making hybrids an increasingly desirable option for consumers looking to keep both purchase price and operating costs low without altering their driving habits or facing range anxiety,” said Brauer.

Turning to the new-car side of alt-fuel vehicles, the Costco Auto Program announced that it offering Costo members incentives on new hybrids and EVs from Volvo, Chevrolet, Cadillac and Polestar — this marks the first time it has offered such incentives on all four brands at the same time.

More information on the deals, which began Wednesday and run through July 31, can be found here.

“Costco Auto Program recognizes that for many car owners, vehicles are an extension of their own personality and style,” Costco Auto Program general manager Jay Maxwell said in a release. “Keeping this in mind, we are happy to offer savings on vehicles from four different manufacturers to help Costco members step in to the hybrid or electric vehicle that best fits their lifestyle.”

The post Alt-fuel vehicles don’t necessarily have to break the bank appeared first on Auto Remarketing.

But first, here’s how the market looks at the end of April.

In a word, they’re stable, a departure from the past 12 months, CARFAX said.

“After falling down a steep pricing slope over most of the last year, the average used car prices on Carfax.com have — in most segments — flattened out, suggesting a return to “normal” after a couple of years of upheaval in the market,” CARFAX editor in chief Patrick Olsen writes in the analysis.

“We say ‘normal’ because prices are still running higher than historic levels, and the market is still being affected by fallout from the pandemic,” Olsen said.

Tom Kontos, the chief economist at ADESA, has noticed a similar flattening in wholesale used-car prices.

After climbing 2% from February, average wholesale prices went from $14,603 in March to $14,530 the week ending April 14, according to the latest Kontos Kommentary report.

“The 2024 tax season still had some ‘spring’ in its step (please pardon the pun), as exhibited by wholesale price rises and solid retail sales in March,” Kontos wrote in the analysis. “But that bounce may be waning in April, as wholesale prices plateaued and dealers became more selective when restocking their inventories.”

As for those three takeaways from CARFAX, the first is that the segment showing the most decline year-over-year is the hybrid/electric vehicle, where prices are down 7.9%.

“As gas prices go up during the summer months, this could be the right time to invest. That is, if these vehicles meet your needs – they’re not for everyone,” Olsen writes.

While his advice was geared toward consumers, the same sentiment could be applied to dealers.  In the first half of April, for example, wholesale prices on EVs were down 18.3% year-over-year, according to the latest mid-month reading of Cox Automotive’s Manheim Used Vehicle Value Index.

The second takeaway from the CARFAX analysis was that there have been solid declines in both SUV prices (down 7.1% year-over-year) and luxury SUV prices (down 7.3%).

CARFAX also recommended consumers acting sooner than later on these vehicles, as “prices are starting to edge up.”

Lastly, the steadiest segment has been the non-luxury car, which would include sedans, coupes and wagons. Prices have fallen 1.7% year-over-year.

“Of course, this has always been the bargain segment, so there’s not much room for these prices to fall,” Olsen said. “Add to that the ongoing love affair with pickup trucks and SUVs, and cars remain a good value for commuters or folks who don’t need tons of cargo space.”

Speaking of pickups, those were marginally steady, declining 3.7% year-over-year. Luxury cars were down 6.1% and van prices dropped 6.0%, according to CARFAX.

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For the latest installment of its “Tuesday Nights Live” series on YouTube, ATI Auto Business livestreamed with Cherokee Media Group senior editors Joe Overby and Nick Zulovich from the Auto Intel Summit + National Remarketing Conference in Cary, N.C.

Joe and Nick recapped Day 1 of AIS + NRC with ATI host Jay Wertzberger, including a look at the first-ever live recording of the Auto Remarketing Podcast, which took place at the event’s opening luncheon and included Cox Automotive’s Jade Terreberry and TransUnion’s T.J. Cox.

The podcast version of their conversation can be found below.

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In a month were days-to-sell plummeted (more on that later), franchised and independent dealers combined to sell an estimated 1.66 million used vehicles, which was a 10.9% gain from March 2023 and up 18.5% from February, according to Cox Automotive.

Through three months of 2024, dealers have sold approximately 4.38 million used vehicles, compared to 4.29 million the same period of 2023, Cox data shows.

The company bases its sales estimates on Live Market View data from its vAuto business unit.

“As we move into spring, sales for used vehicles typically rise and we saw that trend continue this year with strong demand,” Cox Automotive senior director of economic and industry insights Jeremy Robb said in the report.

“Sales for used vehicles picked up in February, continuing to increase for eight weeks in a row before peaking towards the latter half of March. Affordability matters more than ever to consumers, and declines in used-vehicle prices help offset higher interest rates,” Robb said. “Once tax return season got underway, many consumers had more income to use as a down payment, driving customers into retail dealerships.”

The year began with used-car sales by dealers falling 6.4% year-over-year and climbing 1.3% month-over-month in January, according to the Cox data.

In February, used sales were up 4.1% year-over-year and improved 7.4% from January.

Certified pre-owned sales have also been strong to start the year. According to data that Cox reviewed, there was an estimated 231,927 CPO sales in March. That beats February figures by 10.1% and is up 1.1% year-over-year.  Year-to-date CPO sales are also up 1.1%, Cox said.

And it’s not just that used cars are selling — they’re also selling fast.

According to iSeeCars.com, 1- to 5-year-old used vehicles spent an average of just 34.2 days on the market in March. That’s down from 49.8 days in February and 64.8 days in January.

Hybrids are selling particularly fast (30.4 days on market) when compared to the overall market and electric vehicles (36.4 days on market).

“While used cars and used EVs track closely in sales pace, hybrids again hold an advantage,” iSeeCars executive analyst Karl Brauer said in an analysis. “Their lower fuel costs and lack of range anxiety make hybrids a desirable option for consumers looking to reduce post-purchase operating costs without altering their driving habits.”

The post Used-car sales climb about 11% & move at faster clip appeared first on Auto Remarketing.

Our behavior made new insights from DTS highlighting the top songs users listened to in their vehicles last year even more intriguing. Literally, it was a crossroads of professional and personal interests.

Many folks from auctions, dealerships, finance companies and elsewhere have said in person or through social media that “all some people want is a car with four wheels and Apple CarPlay.”

I can understand the sentiment. With a trio of aftermarket accessories costing less than $150 combined, I was able to upfit my 2007 Toyota RAV4, so I can take advantage of the massive musical capabilities of an Apple iPhone with the factory sound system already installed.

After I turn the ignition, accessing my music library is the next order of business.

And no doubt, many other drivers get their music or other media content going straightaway, too.

“The way consumers view their vehicles has changed considerably in recent years. The vehicle is now viewed as a destination unto itself for work, socializing and even relaxing,” DTS said in a news release that highlighted DTS AutoStage’s Song Impact Report.

“Radio remains a pivotal entertainment source for the vehicle, and the DTS AutoStage platform, the only global entertainment platform for the connected car, is delivering next-generation, AI-powered connected radio, audio and video content for more than 100 connected car models worldwide, seamlessly combining linear broadcast with IP-delivered content that enables a powerfully personalized, unified, user-centric experience,” the wholly owned subsidiary of Xperi continued in that news release.

With that platform as the source, the report indicated the top 10 songs played last year included:

1. “Cruel Summer” by Taylor Swift
2. “Snooze” by SZA
3. “Flowers” by Miley Cyrus
4. “Calm Down” by Selena Gomez
5. “Fast Car” by Luke Combs
6. “Last Night” by SZA
7. “Dance the Night” by Dua Lipa
8. “Paint the Town Red” by Doja Cat
9. “Sure Thing” by Miguel
10. “Need a Favor” by Jelly Roll

“The radio industry has long reported spins, which provided some measure of a song’s performance, but in today’s digital age, it’s really all about the listener and how they are responding to new music,” Xperi senior vice president of broadcast at Joe D’Angelo said in the news release.

Confession time: Of those 10 songs, I have only heard one previously. And I’m old enough to remember when Tracey Chapman first sang that song Combs covered and gained so much airtime and attention for it. But, according to DTS, music afficionados sought out the original 1988 version after hearing Chapman give a live performance with Combs at the 2024 Grammys.

You can check out the top 100 songs played in vehicles last year through the DTS platform via this site.

How many of those songs have you heard previously? How many are among your favorite tunes?

Thanks to today’s technology, I’m still listening to the same 1990s country, pop and alternative music I heard on bootleg mix tapes and CDs in the old Chevrolets I drove in high school and college. I’ll ping Joe now and then with a song from that era he probably hasn’t heard previously. Joe replies sometimes with great songs from artists with real talent, not just a laptop tuner.

So, the next time you get behind the wheel, enjoy whatever music brings you joy. We sure do.

Nick Zulovich is senior editor at Cherokee Media Group and can be reached at nzulovich@cherokeemediagroup.com.

The post From the editor: This in-car song list is music to our ears appeared first on Auto Remarketing.

Not surprisingly, then, the monthly Cars Commerce Industry Insights Report for March showed a big surge in inventory.

The report found used-car supply jumped 7.6% from February to March, based on the company’s marketplace inventory, as dealers stocked up for the tax-season rush. That was also 4.7% higher than March 2023.

At the same time, used-car prices plummeted 5.1% year-over-year, to an average of $28,433, its lowest level in 32 months.

“March’s data shows the new- and used-car markets are adjusting,” the Cars Commerce analysis said, “with new-car prices continuing to drop and used-car prices hitting their lowest point in years, signaling a move toward more typical pricing.”

The report, compiled by Cars Commerce’s data analysts, looks at supply, demand, pricing and consumer behavior data from across the company’s platform, including Cars.com, Dealer Inspire and AccuTrade.

The inventory increase has been driven by the lower end of the price scale, with the supply of vehicles priced less than $30,000 up 12.2% from last year. The largest sectors of the used market — $20,000-$29,000 and $10,000-$19,000 — were up 10% and 13.3%, respectively. Cars under $10,000 were up 19.1%.

That said, those cars now have more miles on their odometer than similarly priced vehicles in the past. Those priced less than $20,000 now average 8.6 years old with 93,000 miles, three more years and 24,800 miles more than in March 2019.

The report found trade-in values continuing to drop — down 15% from their 2022 peak to $28,433 for vehicles 2-6 model years old, though still more than $5,000 above pre-pandemic levels.

Leading the way in that decline is the 3-5-year-old Tesla Model Y, which, according to Cars Commerce, has dropped $13,580 worth of trade-in value in the past year to its current $26,520, a 33.9% decrease.

But that’s not far out of line for used electric vehicles, which have fallen more than 20% year-over-year to an average of $36,429. Used-EV inventory and demand are also up, according to the report, with inventory soaring 49% year-over-year and 16.5% month-over-month, and demand, as measured by searches on Cars Commerce’s platforms, up 14.5% since February and 37.6% since March 2023.

The complete report is available here.

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According to sales data analyzed by Kelley Blue Book in its Q1 2024 Electric Vehicle Sales Report, Americans purchased 268,909 new EVs in the first quarter. That’s up 2.6% year-over-year, but down 15.2% from the Q4 2023.

Stephanie Valdez Streaty, director of industry insights for KBB’s parent company, Cox Automotive, said that represents the first quarter-over-quarter drop in EV sales since the second quarter of 2020 – the beginning of the COVID pandemic shutdowns.

The year-over-year increase was also much smaller than those of the past two years. In Q1 2023, EV sales volume rose 46.4% from the previous year and 15.5% quarter-over-quarter. In 2022, first-quarter EV sales jumped 81.2% year-over-year and 20.4% from the previous quarter.

Cox Automotive analysts said the slowdown in EV sales growth was expected, as segment growth typically slows as volume increases.

That is best illustrated by Tesla, which has long dominated the EV market. According to KBB estimates, Tesla’s U.S. sales plummeted 13.3% year over year, a huge departure from its past double-digit gains.

As a result, KBB said, Tesla’s EV market share has dropped from 61.7% a year ago to 51.3%.

“As anticipated, Tesla’s sales took a hit, influencing the overall market dynamics,” Valdez Streaty said in a news release. “However, a few brands saw significant EV sales increases, achieving over 50% year-over-year growth.”

The KBB report showed nine brands — BMW, Cadillac, Ford, Hyundai, Kia, Lexus, Mercedes-Benz, Rivian and Vinfast — surpassed that 50% mark. For Cadillac and Mercedes, EVs now make up 15% or more of their brand’s total sales.

Cox said strong EV sales from luxury brands suggest the EV market remains luxury-driven. The success of Cadillac’s Lyriq fueled that brand’s 500% year-over-year increase in EV sales, while Mercedes and BMW recorded more than 60% growth.

On the other side of the price spectrum, the nation’s most affordable EV in the U.S. — the Chevrolet Bolt — has been removed from the market temporarily halted. KBB said Bolt sales fell 64.3% year-over-year in Q1 to just 7,040 when production stopped. A new version of the Bolt is expected to launch in 2025.

Among non-luxury brands, Ford’s EV sales soared 86.1% year-over-year to move it into second in volume behind Tesla.

Cox Automotive said overall EV sales volume has been supported by lower prices, with Tesla leading the way. Tesla’s Q1 average transaction price of $52,315 was down 13.5% year-over-year. The average transaction price among all new EVs fell 9% to $55,167.

That said, Cox’s analysis noted lower prices did not generate higher volume, and said the price cuts and increased incentives offered by many brands are signs of slowing demand.

In addition, the analysis said, EV leasing has more than doubled in the past year, now accounting for 27% of all new EV transactions, allowing many buyers to qualify for the full $7,500 tax incentive created by the Inflation Reduction Act.

All that said, Cox Automotive is forecasting another rise in U.S. EV sales in 2024, with EVs expected to reach a 10% market share by the end of the year.

“As noted in January, we are calling 2024, ‘The Year of More,’ ” Valdez Streaty said. “More new products, more incentives, more inventory, more leasing and more infrastructure will drive EV sales higher this year. Even so, we’ll continue to see ups and downs as the industry moves towards electrification.”

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First, we need to look at our “short-term gain” decisions we made back in 2020.

New cars were at a premium that year, and many dealers decided to “make hay while the sun shines” so, according to NADA, as a result, the new per-vehicle gross profit by 22% nationally.

That was then. Today? The supply of new cars is up, and in many cases back to pre-pandemic levels. We know that means the future will include additional incentives and competitive pricing.

Meanwhile, used-car values are trending down. The increase in new-car incentives and lower selling prices will put additional downward pressure on used vehicles for the near term.

That all means that we’ve put our best, most loyal customer in a very tough spot. How? Once again, unlike the last time they bought, there are new cars readily available — and as part of their normal trade cycle that we include in our sales forecasting, that will bring them back to our dealerships.

That’s usually a good thing. In fact, that’s how we stay in business. However, this time, based on those 2020 decision, they are the proverbial “upside-down” customers. Even if they paid cash or did only a short-term loan, they’re about to be informed their vehicle is worth quite a bit less than they had anticipated, based on the premium they had to pay when they bought it.

Here’s the decision we need to make:

What’s more important? Do we try to make another home run sale at the risk of alienating our loyal, returning clients? Or do we make customer retention the priority, and do what we have to in order to keep them in the family – and coming back?

If you decided to go the first direction, good luck with that. I’ve got nothing for you.

If you take the second path, here’s some advice for what may be the biggest challenge you will face. When you go to appraise these trade-ins — “throw the book out.” If you appraise simply with a wholesale value based on the Year, Make, Model and mileage, and aiming for the margins you’ve been making the last few years, you won’t have much success.

Instead, recognize that these are your best, most loyal customers. Their vehicles are:

• Well-maintained (mostly serviced at your dealership)
• One-owner
• Just 4 to 6 years old
• In the right colors
• With the right options

This is the hard-to-find used car inventory that you’ve been begging for the last 4 years.

The right answer: Step up. These are not the vehicles you’ll get hurt on. The smartest move would to OEM certify them. Price them to the right retail amount from Day 1. Time is not your friend. Sell them in the same market window you traded for and DO NOT let them age.

The No. 1 goal? Keep them in your customer base!

–Just The Fax

By Robert Grill, Carfax Senior Partner Development Manager

Read Just The Fax on Auto Remarketing | Follow Our Podcast | Email Bob Grill

The post COMMENTARY: Are you prepared to make the right long-term decision? appeared first on Auto Remarketing.

Not surprisingly, it’s in California, according to a report from Realtor.com and Cox Automotive.

In fact, the 2024 Realtor.com Housing Market and Electric Vehicle Report found three of the top 10 and eight of the top 20 housing markets for EV ownership are in the Golden State.

The San Jose-Sunnyvale-Santa Clara market ranked No. 1 on the list, followed by Salt Lake City, Utah; San Francisco; Boston; Seattle; Durham-Chapel Hill, N.C.; Austin, Texas; Los Angeles; Washington D.C. and Denver.

“A mix of accessibility to charging facilities and a high share of EV-friendly homes listed on Realtor.com made those places the most EV-friendly housing markets,” Realtor.com chief economist Danielle Hale said in a news release. “The data shows home sellers are very aware of the trend toward electrification. Mirroring the rise in the number of electric vehicles, the share of homes marketing EV-friendly characteristics on Realtor.com is growing over time.

“Similarly, rates of EV adoption vary by market, and rates of EV-friendly homes in different areas reflect that. As the number of EV owners grows, I expect to see more demand for at-home charging and EV-friendly characteristics from both buyers and renters. Sellers and property managers who can meet that demand, which can be found in newer and older homes, will undoubtedly have an edge.”

The analysis ranked markets on Realtor.com based on the combination of EV-friendly listings and the congestion index — the ratio of EVs and plug-in hybrids to public charging ports.

The report noted more home listings are now being described as EV-friendly, climbing from 0.1% of for-sale homes on Realtor.com in in 2018 to 0.9% in 2023.

In the San Jose market, the report said, one in five households has an EV and 4.9% of homes in Realtor.com were listed as EV-friendly — the most of any market. Listings are considered EV-friendly if the include terms such as “electric vehicles” and “240-volt outlet” in the descriptions.

Boulder, Colo. (3.4%), Seattle (3.3%), Bloomington, Ill. (2.2%), Honolulu (2.1%), Bend, Ore. (2.1%), Trenton, N.J. (2.0%) and Austin (2.0%) all had a higher-than-average share of EV-friendly homes listed for sale.

“We have found a clear and positive synergy between the housing market and EV adoption,” Cox Automotive chief economist Jonathan Smoke said. “While we remain in the early innings in the electrification of the auto market, with dramatic variation in adoption thus far, EV-friendly homes are proving to be key.

“Having access to a charger is fundamental to the ease of use for an EV, and when that charger is in a home, it is both convenient and economical. That in turn makes EV-friendly homes stand out in markets with more EV owners.”

Still, even in EV-friendly markets like Oxnard and Riverside, Calif., Honolulu and Portland, Ore, where there’s already a high concentration of EV-friendly listings, the crowded public charging facilities indicate a potential for even greater demand for EV-compatible homes, the report said.

The full report is available at www.realtor.com/research/electric-vehicles-2024.

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That’s the big takeaway from Kerrigan Advisors’ newly released 2023 Blue Sky Report, which showed dealership buy-sell activity up 6% year-over-year, with a record 397 completed transactions in 2023.

Among those sales, the sell-side advisors for auto dealers said, was the third-largest transaction in auto retail history – the sale of Jim Koons Automotive’s 20 dealerships, generating $3 billion in revenue, to Asbury Automotive Group.

The report said thanks to “significant access to capital” 680 franchises were sold, up 5.4% from 2022, even as the overall corporate merger and acquisition market declined 30% in 2023.

“Despite negative headwinds of higher interest rates and declining profit margins, dealers continued to seek acquisitions, powered by their belief that scale is not only critical to future success, but essential to sustaining their businesses in the face of an evolving industry,” Kerrigan Advisors founder and managing director Erin Kerrigan said in a news release.

“We expect the consolidation trend, ignited by the pandemic-induced surge in industry earnings, to continue in 2024, as the industry has amassed nearly a quarter of a trillion dollars of pre-tax earnings since the pandemic.”

Kerrigan noted that nearly half of the more than 650 dealers surveyed by Kerrigan Advisors in November said they planned to acquire one or more dealerships in the next 12 months, while only 6% expected to sell.

As a result of that strong buyer demand, Kerrigan Advisors said, dealership valuations remained near historically high levels in 2023, though they were down slightly from the previous year. The report said estimated blue sky values dropped by an average of 8%, which it said was far less than the estimated 26% reduction in industry earnings, as buyers were driven by expected future earnings rather than past performance.

“When earnings soared in 2021, buyers correctly projected that pandemic earnings were unsustainable, and normalized earnings for valuation purposes,” Kerrigan said. “When earnings declined in 2023, those normalized expectations were already accounted for in most valuations and thus had less of an impact on blue sky.”

The report showed public dealership groups spent $2.7 billion to acquire 61 franchises, the second highest U.S. acquisition spending level on record. Dealerships in the South were particularly coveted, accounting for 42% of all sales last year — more than twice the next-strongest regions, the West and Northeast.

Looking forward, the Blue Sky Report offered three trends Kerrigan Advisors expects to impact the market in 2024: Buyers are increasingly focusing on the past 12 months’ financial performance to determine blue sky value; top import and luxury franchises in growth markets continue to achieve record valuations; and state electric vehicle mandates, if left unchecked, will have negative implications for blue sky values.

Highlights from the report include:

• The 126 multi-dealership transactions in 2023, matched 2021’s record number. That represents 32% of all sales last year.
• The industry is consolidating, with the percentage of dealers with 11 or more dealerships rising and that of dealers with 5 or fewer dealerships declining.
• Public dealer groups ended the year at a blue sky multiple below the 7.3x average of the top franchises, and mostly in line with the 3.75x average of domestic franchises, often leaving them priced out of the buy/sell market for top assets.

A preview of the report can be downloaded here. Click here to subscribe for the full report.

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It may depend on which industry index you’re observing. Still, a common theme of “normalcy” certainly has emerged in the used-car market.

On Monday, Black Book released its Used Vehicle Retention Index, which fell 13.6% year-over-year and rose 0.9% month-over-month to come in at 151.8 for March.

Its chief data science officer suggests that this year’s spring market was rather robust and that Q1 showed normalization in the market.

“We are observing a stronger spring used auto market in terms of prices and wholesale activities this year,” Black Book’s Alex Yurchenko said in a news release. “Used wholesale prices have been increasing at rates above normal levels across most segments and age buckets since early March.

“Additionally, wholesale channel volumes and conversion rates saw increases last month,” Yurchenko said. “During the first quarter of this year, we observed a return to some normalcy even in the face of some headwinds in the used and new market — buildup of new inventory, increased incentives, improved retail and commercial sales, and more active wholesale used market.”

At Cox Automotive, the company’s Manheim Used Vehicle Value Index for March (203.1) was down 14.7% year-over-year and 0.4% month-over-month, when adjusting for mix, mileage and seasonality.

Unadjusted, it was down 11.4% year-over-year and up 3.1% month-over-month.

Cox’s analysis suggests a more “muted” spring market in wholesale, but one that also brought a return to normalcy.

“Our normal spring bump was a bit muted this year, but the wholesale market progress in terms of timing and weekly changes – it was the most normal pattern we’ve seen in some time,” Cox Automotive chief economist Jonathan Smoke said in a news release.

“From a historical perspective, we typically see a 3.4% increase in March (non-seasonal) and came up with a 3.1% this year. We expect the market and prices to continue a downward trend — demand is tepid at best, as shoppers just don’t have any urgency to buy in the current economic environment,” he said.

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U.S. law firm Troutman Pepper acknowledged those elements and other risks undermining EV adoption in its new industry report released on Monday. But Troutman Pepper also offered four recommendations to help.

In Driving Change: Scaling up EVs in the U.S., Troutman Pepper has been joined by a variety of market experts to reflect on recent growth in the sector and the impediments to continuing this expansion.

Experts explained that federal incentives, growing consumer demand and supportive policies are driving efforts by the automotive industry to scale up production and uptake of electric vehicles.

Troutman Pepper pointed out consumer demand has led to a record number of EVs on the road. And the firm said businesses, consumers, and policymakers are increasingly aligning their efforts to support that growth.

However, Troutman Pepper acknowledged that scaling further requires transformative change to infrastructure and environmental regulatory programs — as one report participant put it, “everything has to change.”

The report argued that the continued advancement of EVs requires a fundamental and dynamic upgrade and expansion of charging station infrastructure, along with a supportive regulatory framework for the establishment of new manufacturing facilities in the U.S. to produce EV batteries and vehicles.

Although the federal government has offered significant incentives to accelerate production, Troutman Pepper pointed out that automakers have been left scrambling to unpick complex infrastructure permitting rules.

Experts added this is further complicated by individual interpretations and implementation by states of federal policies and guidelines.

“While the federal government is pushing out new policies and regulatory guidance to aid in the permitting of battery manufacturing, it is the states that implement those programs,” said Andrea Wortzel, Troutman Pepper’s environmental and natural resources practice group leader.

“Some states are more cautious than others, and the application of environmental regulatory programs to the various aspects of EV battery manufacturing can vary significantly from state to state,” Wortzel continued in a news release.

Additionally, the report highlighted the urgent need for faster permitting for scaled up battery manufacturing facilities. The report also touched on concerns around the workforce skills, technology, machinery and raw materials necessary to support the desired growth in this industry.

“A lot needs to happen for EVs by 2026 to be widely adopted,” Troutman Pepper Partner Dan Anziska said in the news release. “That includes speeding up the permitting process for battery gigafactories and speeding up manufacturing facilities.

“It is expensive and time-consuming to build a massive gigafactory, as well as being reliant on many suppliers, and there are so many that have been announced. There’s competition for everything from labor to equipment and resources,” Anaziska continued.

Having spoken with EV industry experts who shared their insights about the biggest infrastructure and regulatory challenges facing the industry, the report focused on the following four recommendations:

Continue to expand the public charging station network.

Troutman Pepper found that states must clarify the charging station functions that should be performed by electric utilities. In states encouraging non-utility firms to own and operate charging stations, regulators must confirm that operators will not be required to be permitted as public utilities, but be viewed instead as service providers operating in a competitive environment.

Provide clarity on environmental rules for battery factories.

The firm pointed out automotive companies and battery makers are driving innovation. However, a lack of regulatory clarity can delay permits and investments in new battery plants in the U.S.

Troutman Pepper encouraged policymakers to seek and deliver clarity, particularly related to the import or manufacture of chemical components for EV batteries, as well as recycling processes. Experts said these rules will help advance innovation in the manufacturing, recycling, and management of battery waste.

Streamlined approval processes for key battery chemicals.

Troutman Pepper suggested the EPA should streamline approvals for chemicals used in EV battery production that are similar to ones already approved. Applicants may not have access to all available information due to trade secret protections.

“But the EPA does and could use it to make more informed and streamlined decisions,” the firm said.

Similarly, Troutman Pepper suggested the EPA could issue additional policies or guidance to outline how wastewater from EV battery production is handled under the 1986 categorical pretreatment standard for battery manufacturing. Minimally, the EPA could outline the information and process for determining whether the standards apply to the technology used in EV battery manufacturing.

Encourage innovation and collaboration in battery recycling and disposal.

Troutman Pepper determined the industry would benefit from collaboration regarding best management practices associated with EV battery recycling, including management of shredding operations. This includes the development of uniform, certain, and protective environmental permitting programs for EV battery recycling.

Troutman Pepper said that addressing these bottlenecks is essential for the expansion of EV adoption, and the report metioned additional proposals from the firm’s environmental and energy teams on how this can happen.

“Momentum is building for the transition to electric and there is a tremendous push to supercharge EV sales. The report concludes that the right mixture of public policy, investment, and innovation will enable the EV sector to achieve its full potential,” Troutman Pepper said.

Driving Change: Scaling Up EVs in the U.S. can be downloaded via this website.

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Wholesale auction sales volume in the first three months of 2024 represents the strongest first quarter in four years, according to AuctionNet data from the National Auto Auction Association shared exclusively with Auto Remarketing.

There were 1.7 million units sold at auction in Q1, which beats year-ago figures by 7%, NAAA said in its monthly analysis.

In March, there were 582,956 units sold at auction, down 4% year-over-year and up 1% from February. But take that dip from a year ago with some context.

“Sales volume remained robust however, reaching nearly 583,000, with the negative prior year comparison due more to last March’s strong 607,500 unit tally rather than a material erosion in sales this year,” NAAA vice president of Auction Data Solutions/AuctionNet Larry Dixon said in the commentary.

Breaking it down by seller type, sales from dealers was up 3% from February, the third consecutive month-over-month gain. Sales from commercial consignors were down 2% month-over-month, but are showing some major improvement from 2023.

Dixon notes that, “despite three straight month-over-month increases, dealer sales over the quarter were down 5.4% versus Q1 2023, while commercial sales were up nearly 28% compared to last year.”

In Q1, dealers had a 54% share of auction sales volume, with commercial consignors at 46% (excluding other sale types like salvage), according to the NAAA data.

There has also been improvement across all vehicle age bands, with 11-year and older units having the strongest gains in Q1 (up 11% year-over-year). Sales of vehicles up to 3-years-old and sales of vehicles between 4- and 10-years-old were each up 5%, respectively, according to the data.

Battery-electric vehicle sales still represent a small portion of the overall auction market (1.4% share in Q1), but their numbers are improving.

There were 8,990 auction sales of BEVs in March, beating year-ago figures by 78.1%. Through three months, there have been more than 23,000 sales of BEVs at auction, which is 83% higher than Q1 2023.

More details from NAAA’s AuctionNet data can be found below.

Note: This is part of a new monthly series in which Auto Remarketing shares AuctionNet data and commentary provided by the National Auto Auction Association.

As noted by the organization, more than 260 NAAA member auctions power AuctionNet, making it the most comprehensive source of wholesale auto auction sales data in the U.S. Unless otherwise noted, auction sales figures are based on total reporting auctions, the number and composition of which may vary over time. 

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Wertzberger brought this group together to give viewers a preview of the event scheduled for April 23-25 in Cary, N.C. This session included:

Neil Alliston of Ravin AI

John Foley of Recharged

Alain Nana-Sinkam of a.i.m.

John Possumato of DriveItAway

Micah Tindor of Cox Automotive

Jeremiah Wheeler of DRN | MVTRAC

You can watch the show on demand in the window below.

The post ATI Auto Business hosts AIS+NRC preview with 6 speakers appeared first on Auto Remarketing.

Six primary findings from the sixth annual U.S. Consumer Insights Report from CarGurus reinforced this market condition.

The digital auto platform for shopping, buying, and selling new and used vehicles sought to learn more about how shoppers’ habits have shifted in response to an automotive landscape that has three distinct attributes:

—Interest rates and costs that continue to be elevated

—Selection that is growing

—Additional opportunities to do more from home

The survey of recent car purchasers and/or sellers examined factors influencing why and where people buy and sell, as well as their preferences to navigate some — or all —portions of a transaction online.

For a complete picture of the buy/sell journey, the survey also considered sentiment after the transaction.

“The automotive market has seen incredible change within the last few years, with pricing and inventory levels in flux, EVs becoming more mainstream, and more paths to purchase — especially online — available for shoppers,” CarGurus director of product marketing Alison Ciummei said in a news release. “As we examine how these factors have impacted buying and selling habits, there is a consensus: consumers are taking control of the process in a way that makes the most sense for their individual goals for pricing, convenience, and confidence in the transaction.

“Whether that involves exploring financing options, considering a trade-in, or comparing vehicles against specific needs, shoppers are looking to both digital retail tools and dealership support to tailor the most seamless experience possible,” Ciummei added.

Here are the six survey findings that prompted CarGurus to make those assertions.

1. Vehicle reliability and costs were more important to consumers compared to prior years

While vehicle costs and reliability remain the dominant factors influencing decisions, CarGurus noticed more shoppers today are likely to cite reliability (41% versus 35% in 2022), finding a vehicle that fits their budget (40% versus 33% in 2022), and expected costs (26% versus 21% in 2022) as the most important factors in selecting a vehicle.

Findings point to these priorities trumping loyalty to a specific make or model, with 89% saying they’d be willing to switch models and 69% open to switching brands.

2. The best price often determines where consumers buy

According to CarGurus’ findings, price remains the top priority in determining the seller they select, with 55% of respondents saying it’s the most important factor, followed by inventory selection (34%), and availability of financing or special offers (26%).

Notably, analysts pointed out confidence in being treated fairly increased (23% versus 17% in 2022).

3. Consumers are more open to selling their vehicle entirely online

CarGurus discovered 82% of consumers are open to selling their vehicle entirely online (up from 77% in 2022).

In tandem, the survey showed 69% of shoppers say they want to conduct more of the buying process from home, particularly price negotiation and trade-in estimates.

CarGurus mentioned that the preference to do more from home has remained unchanged year-over-year since rising from 60% in 2021, indicating a lasting shift in behavior.

Steps that mainly occur online (or a combination of online and in-person) include researching what vehicle to buy (81%), assessing the value of a car to be sold (77%), and getting offers to sell a car (69%), according to CarGurus.

4. Financing declines year-over-year

According to findings, 42% of buyers apply for financing before a dealer visit.

However, 56% of respondents said they financed (down from 60% in 2022), with many opting to buy in cash due to higher interest rates.

5. More young buyers purchased their first car in 2023.

Of those who said they bought or leased their first car in 2023, CarGurus determined 27% were Gen Z, which was up from 20% in 2022.

Analysts indicated the most popular brands among all Gen Z respondents included Toyota, Chevrolet, Honda, BMW and Ford.

6. Electric vehicle consideration continues to grow

CarGurus learned more shoppers are considering EVs (27% versus 22% in 2022 and 16% in 2021).

However, analysts noticed purchase rates among respondents remain low, with 8% reporting an EV purchase (up from 5% a year prior).

According to findings, 84% of those that had purchased a gas vehicle are sticking with gas, while 20% of those who purchased an EV, and 25% of those who purchased a hybrid, switched to gas.

The full study from CarGurus is available for download via this website.

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The Q4 Haig Report, which tracks trends in auto retail and their impacts on dealership values, showed 528 dealerships changed hands in 2023 — the third-highest annual volume on record, but down from a record 707 in 2021 and 566 in 2022.

That included two record-setting sales, the report said. Al Hendrickson Toyota sold for the highest price ever paid for a dealership of any kind at the time, and Lake Norman Chrysler-Dodge-Jeep-RAM set the record for a Stellantis store, according to Haig Partners, which advised on both deals.

The company also advised on the sale of South Motors/Vista Motors early this year, which it said set records the highest prices paid for BMW and Honda dealerships.

Profits per dealership for publicly traded retailers were down an estimated 23% in 2023, and Q4 2023 average profits per store plummeted 31% from Q4 2022. Haig Partners said dealers believe profits will decline again through 2024 to as much as 15% below current levels.

Still, Q4 profits remained an estimated 78% higher than they were in Q4 2019, just before the COVID pandemic, which Haig Partners said is helping keep buyers and investors attracted to auto dealerships.

“We are seeing mixed trends in auto retail today, which are pushing down dealership profits and dealership values,” Haig Partners president Alan Haig said. “Sharply rising inventories and floorplan expense are pushing down profits at most stores. At the same time, vehicle prices and loan rates for consumers are far higher than before the pandemic, and that is suppressing the pent-up demand we believe exists in the market.

“But even with this decline in profits, dealers are still making far more than they were before the pandemic.”

The estimated blue sky value per publicly-owned dealership at the end of last year dropped 14% from 2022, but are still more than twice pre-pandemic levels. The report said that decline was less than the decline in profits because buyers had already factored in their expectations of falling profits.

Haig Partners said it believes blue sky values for most dealerships will continue to decline in 2024 as their profits continue to moderate.

“Estimated average blue sky per dealership has fallen from a peak of $25 million in 2022 to $21.4 million in 2023,” Haig said. “But even at these lower values, dealerships are still far more valuable today than in the past.

“Life is getting harder for auto dealers, but it’s still pretty darn good.”

Other highlights from the Q4 2023 Haig Report include:

—Approximately 90% of dealerships sold were acquired by private dealers or investors.

—Public company spending on domestic auto dealership acquisitions reached $2.8 billion in 2023, up 50% from 2022 and the second-most on record.

—The average publicly-owned dealership made $5 million in fiscal year 2023, a 23% drop from year-end 2022.

—Since the pandemic, some brands, such as Mazda and Kia have performed very well, while others, like Honda and Infiniti, have struggled, which has affected dealership profits and values for those brands.

—The buy-sell market is expected to remain very active in 2024.

Publicly traded auto retailers were in acquisition mode throughout 2023, spending 52% more than the previous year on U.S. auto dealerships, with two of them — Asbury and Lithia — spending a combined $2 billion on platforms. Haig expects public retailers to continue aggressively acquiring dealerships in 2024.

To subscribe for the full Haig Report, click here.

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But a recent survey conducted by Edmunds found there is still a disconnect between what consumers want and what is currently available in the EV market.

In her analysis of the 2024 Edmunds EV Sentiment Survey, conducted in January, head of insights Jessica Caldwell said the results show “a significant mismatch between car shopper preferences and the realities of today’s EV market that could be reflective of current market challenges.”

Those large gaps show up in three areas consumers say are critical EV purchase considerations: price, brand trust, vehicle body type and driving range.

When it comes to cost, the survey found 47% of the respondents who indicated they’re considering an EV for their next vehicle purchase said they’re looking for something at less that $40,000, and 22% want an EVs priced less than $30,000.

Caldwell pointed out there are no new EVs available with an average MSRP of less than $30,000, and only four — the MINI Hardtop 2 Door, Nissan Leaf, Fiat 500e and Hyundai Kona Electric — priced less than $40,000.

Edmunds data shows the average EV transaction price in 2023 was $61,702, almost $15,000 more than the average for all other vehicles ($47,450).

“It’s worth noting that the consumers who are most comfortable with the idea of purchasing a new EV might also not be in a financial position to afford one,” Caldwell said in the analysis, citing survey results showing 90% of 18- to 24-year-olds and 83% of 24- to 34-year-olds said they’re open to an EV as their next purchase.

Caldwell pointed out another disconnect between the types of vehicles EV buyers want and the vehicles being emphasized by automakers.

According to the Edmunds survey, drivers of pickup trucks are least likely to consider an EV for their next purchase, with 39% saying they would not consider one. Meanwhile, just 10% of all respondents who are interested in an EV purchase said they’d be interested in a truck, compared to 43% for cars and 42% for SUVs/crossovers.

The market reality, Caldwell said, is different.

“The electric truck market appears bloated — Rivian R1T, Ford F-150 Lightning, GMC Hummer EV and Tesla Cybertruck, with possibly the Chevrolet Silverado EV, GMC Sierra EV and RAM 1500 Rev arriving in the not-so-distant future,” she said.

“It’s not surprising that the Detroit automakers moved swiftly to protect their top money-making products from the threat of EV startups, but at least for now it appears this fear was unwarranted, as EV pickup trucks are still largely niche products with a limited consumer base.”

The results of the survey’s questions about range yielded interesting results that Caldwell said imply a “knowledge gap” among consumers.

Asked what they desire regarding the range for an EV they’d consider buying, 46% of respondents said they’d be comfortable with 200 miles or less. And 24% said 99 miles or less.

The fact is, those are very low figures. Edmunds’ EV range test found the vast majority of EV models on the market can go 200 miles or more before recharging, and, Caldwell said, “the significant percentage of respondents who indicated they were comfortable with a range below 100 miles signals a potential knowledge gap surrounding realistic range expectations.”

Edmunds said its data shows sales of EVs rose to 6.9% of new vehicle market share in 2023, up from 5.2% in 2022. But the company’s analysts predict the rate of growth will slow through 2024.

“The electric vehicle market is growing,” Caldwell said in her analysis, “but consumers have enough reservations about the current options and charging infrastructure challenges to limit more significant growth in the short term.”

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J.D. Power’s 2024 U.S. Electric Vehicle Experience Home Charging Study found the customer satisfaction score for all three home charging segments were up from last year’s study, led by a significant rise of 20 points on a 1,000-point scale for Level 1 portable chargers.

Satisfaction for Level 2 permanently mounted home chargers was up four points year-over-year, Level 2 portable charging stations climbed two points.

Level 1 portable chargers operate through a standard 120-volt electrical outlet, Level 2 portable chargers offer faster charging through a 240-volt outlet and Level 2 permanent stations use a wall-mounted 240-volt outlet.

“In contrast to public charging, home charging is the ultimate convenience for owners to charge their EV,” said Brent Gruber, executive director of J.D. Power’s EV practice. “Home charging is the most satisfying aspect of owning an EV, which is why all parties in the EV ecosystem need to take the necessary steps to ensure residential charging is available for current and potential EV owners alike.”

Gruber said incentives and programs are available to offset the costs of charger installations and upgrades, as well as helping manage ongoing charging expenses.

“But too few EV shoppers are taking advantage of those offerings,” he said. “The industry needs to do a much better job with consumer education and awareness, and dealers are certainly in the best position to fill that role at a local level.”

While satisfaction of Level 1 chargers rose dramatically this year, J.D. Power noted there is still a large gap between that segment’s overall score of 581 and that of the Level 2 segments — 735 for Level 2 portable and 744 for Level 2 permanent.

Charging speed is the biggest reason for that difference, the study found. Level 1 chargers have by far the lowest satisfaction score for charging speed at 325, more than 300 points less than Level 2 portable (649) and Level 2 permanent (682).

The study showed Tesla ranks highest among Level 2 permanently mounted charging stations for a fourth consecutive year with a score of 790, followed by Emporia (764) and GRIZZL-E (761).

Other findings include:

EVs have more problems: While satisfaction was up in all three segments, problems per 100 chargers (PP100) were also up in all three year-over-year. Owners of Level 2 portable chargers issues rose by 6.6 PP100 on average, with internet or wi-fi connection issues cited most. Slower than normal charging speed was the most common problem with Level 1 portable chargers, which increased by 8.6 PP100.

Bidirectional charging: Bidirectional charging allows an EV to send energy for use by other devices in the home, or to potentially be returned to the grid to offset consumer energy costs and help balance peak electrical demands. The study showed 35% of owners of premium EVs and 29% of mass market EV owners said they are interested and willing to pay extra for that feature.

Awareness of utility programs: Nearly half (49%) of EV owners said they are unaware of programs offered by their electric utility and 18% say their electric utility does not offer any programs. J.D. Power said educating owners about local utility programs increases customer satisfaction, which benefits automakers and home charger manufacturers. Satisfaction is 18 points higher for cost of charging 15 points higher for fairness of retail price among Level 2 charger owners who use financial incentives for installation, than among those who don’t use incentives.

The U.S. Electric Vehicle Experience Home Charging Study was conducted in collaboration with EV research firm PlugShare, based on a survey of 15,617 owners of 2018-2024 model year battery electric and plug-in hybrid vehicles from December 2023 through February 2024.

Satisfaction is measured in eight areas: fairness of retail price, cord length, size of charger, ease of winding/storing cable, cost of charging, charging speed, ease of use and reliability.

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Analysts found that service activity at franchised dealerships in the U.S. decreased in February compared to January, while revenue increased slightly.

Despite it being a historically challenging month for service departments, Cox Automotive discovered the Repair Order Revenue Index improved year-over-year.

The Repair Order Revenue Index for February came in at 139.9, reflecting a 1.6% increase from the January reading. This index rose 4.5% year-over-year and 26.4% from February 2019.

Analysts explained the notable jump from five years ago stemmed in large part to inflation and higher labor and parts costs.

Meanwhile, the February Repair Order Volume Index dropped to 78.8, marking a 4.1% decrease from January. Analysts acknowledged the reading was a 2.2% increase from February of last year, but it also was a 12.3% decrease from February 2019.

Cox Automotive reiterated the monthly Xtime volume and revenue metrics are designed to showcase average service department performance over time, with the information indexed to February 2019.

Analysts added the two top-line measures provide a glimpse into service department performance at franchised dealerships in the U.S.

Xtime provides software that helps auto dealers facilitate more than 10 million service appointments monthly.

Skyler Chadwick, director of product consulting at Cox Automotive, looked to add some clarity to the metrics and recommendations for managers through a Data Point.

“February is typically a bump in the road for service departments, with low consumer spending,” Chadwick said. “The data show that the volume of repair orders was low due to customers not keeping their appointments.

“In such a difficult month, dealers must ensure that appointments are confirmed, which could be as easy as sending a text reminder,” Chadwick continued. “The decline in appointments was consistent across all OEMs, meaning there is an opportunity for all dealers to improve in this area.”

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The company’s 2024 U.S. Original Equipment Tire Customer Satisfaction Study found the satisfaction gap with original equipment tires between EVs and gas-powered vehicles is widening because EV owners expect their tire wear to be similar to that of gas vehicles.

The reality is EV tires naturally wear faster due to greater vehicle weight and higher torque.

“The widening satisfaction gap between EVs and gas-powered vehicles highlights an opportunity for tire manufacturers and automakers to educate EV owners on the differences in performance,” J.D. Power senior director of benchmarking and alternative mobility Ashley Edgar said.

“Additionally, because of the inherit conflict of maximizing vehicle range and optimizing tire wear for EVs, tire manufacturers and automakers need to work together to overcome the challenge without completely sacrificing tire performance in other areas, especially as the EV market continues to increase.”

Michelin was the top-ranked tire brand in three of the four segments studied, J.D. Power said, winning the luxury category for the 21st consecutive year. Its score of 834 bested Goodyear (812) and Continental (811).

Michelin won the passenger car segment with a score of 823, ahead of Goodyear (811) and Kumho (799), and claimed the performance sport segment with a score of 833.

Falken was No. 1 in the truck/utility segment at 818, followed by BFGoodrich (812) and Hankook (804).

J.D. Power said the U.S. Original Equipment Tire Customer Satisfaction Study measures tire owner satisfaction in four areas — tire ride, tire wear, tire traction/handling and tire appearance — based on responses from 31,414 owners of 2022 and 2023 model-year vehicles and to a survey conducted from August-December 2023.

The post EV owners’ unrealistic tire expectations lead to lower satisfaction, J.D. Power finds appeared first on Auto Remarketing.

Hear what else Manzi had to say about the franchised dealership world from Las Vegas during NADA Show 2024 through this episode of the Auto Remarketing Podcast.

Listen to the episode in the window below.

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Joe and Jeremy connected at NADA Show 2024 last month in Las Vegas for a conversation in which each asked the other five surprise questions.

They chatted about everything from electric vehicles, the Boston Bruins, exploring Vegas by foot and a punk rock museum.

Learn more about the PAL Podcast here and see both Jeremy and Joe record their respective shows from the Podcast Stage at the Auto Intel Summit + National Remarketing Conference, which is set for April 23-25 in Cary, N.C.

Listen to their conversation from NADA in the window below and stay tuned for more from the convention.

The post Dueling Podcasts: Jeremy Louisos of the PAL Podcast & Joe Overby of Auto Remarketing appeared first on Auto Remarketing.

When adjusting for mix, mileage and seasonality, the midmonth reading of the company’s Manheim Used Vehicle Value Index (202.6) is 14.9% lower than the full month of March 2023 and down 0.6% from February, Cox said in a Data Point report Tuesday.

Unadjusted, prices fell 11.6% from March 2023 but were up 2.8% month-over-month, the company said.

Breaking the adjusted price changes down by segment, luxury vehicle prices were down 13.5% year-over-year, compact cars were off 16.6% and midsize car prices fell 16.9%.

Pickup prices fell 15.6% and SUVs/CUVs were down 14.5%.

Electric vehicle prices had a sharper decline in the first half of March (18.8%) than non-EVs (down 13.1%), according to the Cox data.

Looking at wholesale supply, there were 24 days’ supply on March 15, compared to 25 at the end of February, Cox said, citing Manheim data.

Supply in up from 23 days in March 2023, but down from 28 in 2019.

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The report showed dealers moved 1.29 million used vehicles last month, up from 1.13 million in January and the most recorded by ZeroSum since August 2021 – and that number is projected to rise slightly higher in March.

The result of that sales surge was a dip in used inventory levels to 1.89 million units — though still far above the 1.34 million of February 2023 — and a giant leap in turn rate, from 57% in January to 71% a month later.

ZeroSum said the key factor in the used market is pricing, which was down in February for the eighth consecutive month. In all, the report said, the average list price of a used vehicle has dropped more than $3,800 from $30,000 in June to just over $26,000.

The average new-car price, meanwhile, fell below $50,000 for the first time in more than a year, but that decline has been outpaced by the used-car slide.

“The sustained pressure on pricing appears to be having an effect on movement of not only used vehicles but new vehicles as well,” ZeroSum vice president of dealer success Jeff Englishmen said in a news release. “The slower decline in new vehicle pricing is widening the gap between the two, which can cause consumers to consider their options carefully.”

The CPO segment mirrored the overall used-car market with a big sales increase, rebounding from a slow fourth quarter to reach 163,000 in February. Inventory dropped below 200,000 units for the first time in five months as turn rate soared to 86%, the highest level since the 90% rate in March 2023.

As with used cars in general, certified prices have dropped quickly — more than $3,000 in average since May — to about $37,000 in February. That’s also a faster fall than new car prices, which again increases the price difference compared to new vehicles, making CPO vehicles an appealing option to cost-conscious car buyers.

The full report is available for download here.

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This spotlight delves into the heart of this transformation, exploring the myriad ways in which AI technologies, particularly generative AI, are enhancing the efficiency of dealers’ internet and digital divisions.

Generative AI: A new paradigm for customer engagement

At the forefront of this technological revolution is generative AI, a subset of AI that excels in creating content, from text to images, that can pass as human-generated. For automotive dealerships, this means the ability to craft highly personalized and engaging content at scale, a critical component in capturing the fleeting attention of potential customers online.

By leveraging generative AI, dealers can automate the creation of vehicle descriptions, promotional materials, and even personalized email responses, ensuring a consistent and captivating online presence. Moreover, generative AI plays a pivotal role in optimizing dealerships’ websites and digital interfaces.

Through AI-driven analytics, dealers can now understand customer behaviors and preferences in real-time, allowing for the dynamic customization of their websites. This not only improves the user experience but also significantly enhances lead generation and conversion rates by presenting the most relevant content to each visitor.

AI-driven vehicle inspection: Qualifying leads and enhancing service

Another groundbreaking application of AI in the automotive sector is in the realm of vehicle inspection and appraisal. Remote vehicle inspection technology solutions, powered by AI, are transforming how dealerships gather information about vehicles, whether coming in for service or considered for trade-in.

Vehicles arriving for service are now being scanned by service writers using AI-enabled devices, a significant leap from the traditional method of basic image taking.

This technology provides comprehensive scans of the vehicle, identifying potential areas of concern that can be used to discuss additional work with the customer. From tire replacement and bodywork to alignments, these AI-driven assessments allow service writers to present compelling visual evidence of the recommended services, improving customer trust and the likelihood of service uptake.

Moreover, for website leads or trade-in prospects, dealerships are now leveraging remote scan technology that allows customers to perform a vehicle scan in less than two minutes from their location. This scan generates a detailed condition report, enabling remote appraisers to  accurately assess the vehicle’s condition and make informed purchase or trade-in offers.

This not only streamlines the appraisal process but also significantly enhances the customer’s experience by making it more convenient and transparent.

Empowering on-site appraisers and service writers

The benefits of AI-driven vehicle inspection extend beyond the initial lead qualification and service recommendation. On-site appraisers, equipped with insights from AI-generated scans, can efficiently review the condition of vehicles brought in by service writers.

This enables them to quickly identify vehicles that are prime candidates for purchase or trade-in offers, even after the customer has left the dealership. Such agility in decision-making can dramatically increase the dealership’s inventory acquisition rate, ensuring a steady supply of vehicles for sale.

Service writers, on the other hand, are empowered to present detailed images and reports to customers, highlighting potential issues or areas that require attention. This visual and data-driven approach not only enhances the credibility of the service recommendations but also fosters a more transparent and trust-based relationship with customers.

By clearly illustrating the need for certain services, dealerships can significantly boost service department revenues and customer satisfaction levels.

Enhancing operations: Beyond customer engagement

As we delve deeper into the transformative impact of AI on automotive dealerships, it becomes evident that its applications extend far beyond customer engagement and vehicle inspections.

AI technologies are now pivotal in streamlining operations, from inventory management to predictive maintenance, offering a holistic approach to dealership efficiency.

Inventory management revolutionized

AI’s predictive analytics capabilities are revolutionizing inventory management. By analyzing vast amounts of data, including sales trends, local market demand, and even social media sentiment, AI algorithms can accurately forecast which vehicle models and features will be most in demand. This enables dealerships to tailor their inventory acquisition strategies, reducing the overhead of unsold stock and ensuring a more dynamic, demand-driven approach to vehicle sales.

Moreover, AI-driven tools can optimize pricing strategies in real-time, adjusting to market conditions, competitor pricing, and inventory levels to maximize profitability. This dynamic pricing model not only improves sales volume but also enhances customer satisfaction by offering fair, market-reflective prices.

Predictive maintenance and service scheduling

AI technologies are also transforming the service departments of automotive dealerships. Through predictive maintenance algorithms, dealerships can anticipate service needs and schedule maintenance appointments proactively. By analyzing vehicle data and historical service records, AI can identify patterns that predict potential failures before they occur, notifying both the dealership and the vehicle owner.

This not only improves customer service by preventing breakdowns but also allows dealerships to manage their service department workload more efficiently, leading to increased revenue and customer retention.

Case studies: Success stories in the field

Several leading automotive dealerships have already embraced these AI technologies, witnessing remarkable improvements in efficiency, customer satisfaction, and profitability. For instance, a dealership in the Midwest implemented AI-driven inventory management and saw a 20% reduction in the time vehicles spent in inventory, alongside a 15% increase in sales margins.

Another dealership on the West Coast utilized predictive maintenance algorithms to improve service department bookings by 30%, significantly boosting their service revenue and customer loyalty.

The road ahead: Navigating the future of automotive retail

The integration of AI into automotive dealerships is just the beginning. The future promises even more advanced applications, including virtual reality showrooms powered by AI, chatbots for 24/7 customer service, and blockchain technology for secure, transparent vehicle transactions.

As 5G technology becomes more widespread, the potential for real-time data processing and AI-driven insights will further enhance the responsiveness and efficiency of dealership operations.

However, navigating this future will require more than just technological adoption. Dealerships must also invest in training their staff to work alongside AI tools, fostering a culture of innovation and continuous improvement. Moreover, ethical considerations, particularly regarding data privacy and security, must be at the forefront of any AI strategy.

Conclusion

The digital transformation of automotive dealerships, driven by AI technologies, is not just a trend but a fundamental shift in how dealerships operate and engage with their customers. From generative AI enhancing customer engagement to AI-driven vehicle inspections and predictive maintenance, the potential of AI to revolutionize dealership operations is immense.

By embracing these technologies, dealerships can not only improve their efficiency and profitability but also offer a more personalized, responsive, and satisfying customer experience.

As the automotive industry continues to evolve, the successful dealerships of tomorrow will be those that view AI not as a tool but as an integral part of their strategic vision. The journey towards digital transformation is complex and ongoing, but with AI, dealerships have a powerful ally in navigating the road ahead.

Eliron Ekstein is CEO of RAVIN AI

The post COMMENTARY: How AI is driving lead generation in automotive dealerships appeared first on Auto Remarketing.

The pandemic has accelerated changes in consumer behavior and expectations, leading to a notable shortage in the new- and used-car day’s supply.

This scarcity has underscored the resilience of traditional car retail methods, but as the industry evolves, a pivot towards a more omni-channel, customer-centric approach is inevitable. Dealerships that embrace this change are poised to thrive in the new era of automotive retailing.

The pandemic’s impact on car supply

The initial outbreak of COVID-19 brought the global automotive industry to a near standstill.

Manufacturing shutdowns, supply chain disruptions, and workforce constraints led to a significant drop in vehicle production. Despite the gradual resumption of operations, the industry has been grappling with a persistent shortage of semiconductors and other critical components, further straining the supply of both new and used vehicles.

This scarcity has not only driven up prices but also prolonged the day’s supply of cars on dealer lots, a metric that indicates how long the current inventory would last at the current sales rate.

Historically, a balanced automotive market would have a 60-day supply of vehicles. However, during the pandemic, this figure plummeted, with some dealers facing day supplies in the teens.

This shortage has allowed dealers to maintain traditional retail methods, such as requiring customers to make appointments for in-store visits, trades, and test drives. The high demand and low supply have given dealerships leverage, enabling them to stick to conventional sales tactics and avoid discounting vehicles.

Shifting consumer expectations

While the pandemic has temporarily bolstered traditional retail practices, it has also accelerated a shift in consumer expectations towards a more digital, convenient, and personalized buying experience.

The rise of EV manufacturers like Tesla and Rivian, which have eschewed traditional dealership models in favor of direct sales and online ordering, has set new
benchmarks for customer experience. These companies offer a seamless online-to-home buying journey, from virtual test drives to doorstep delivery, reshaping what consumers expect from the car buying process.

The enforced physical distancing of the pandemic has further amplified consumers’ appetite for digital engagement. Buyers have grown accustomed to the convenience of researching, customizing, and purchasing vehicles online. This digital-first approach, complemented by personalized virtual consultations and home delivery services, is becoming the new norm.

As the days’ supply of vehicles begins to stabilize and grow, dealers will need to adapt to these evolving customer expectations. The transition to an omni-channel strategy, which integrates online and offline experiences, is no longer a luxury but a necessity for survival.

The omni-channel imperative

Embracing an omni-channel approach requires a fundamental rethink of the traditional dealership model. Dealers need to leverage technology to offer a cohesive experience across all channels, ensuring that customers can move seamlessly between online research, virtual consultations, in-store visits, and home test drives.

This approach not only caters to the heightened expectations of digital-savvy consumers but also expands the dealership’s reach beyond its physical location.

Furthermore, an omni-channel strategy enables dealers to collect and analyze data from various touchpoints, providing valuable insights into customer preferences and behaviors. This data-driven approach can inform personalized marketing, sales strategies, and after-sales support, enhancing customer satisfaction and loyalty.

Adapting to the new retail landscape

Dealerships that quickly adapt to the omni-channel model will be better positioned to thrive in the post-pandemic world. This adaptation involves not only investing in digital platforms and capabilities but also retraining staff to navigate the blended online-offline environment effectively.

Sales teams need to become as proficient in conducting virtual vehicle demonstrations and consultations as they are in traditional in-person sales tactics.

Moreover, the physical dealership space may need to be reimagined to complement the digital experience. For example, showrooms could be transformed into experience centers where customers can explore and interact with vehicles in more engaging and innovative ways, supported by digital tools and augmented reality.

Operational shifts and challenges

The move towards an omni-channel approach requires significant operational shifts. Dealerships must invest in robust digital infrastructure to support online sales, virtual consultations, and digital marketing strategies.

This includes the development of user-friendly websites, e-commerce platforms, and personalized digital communication tools. However, the integration of digital and physical operations presents challenges, particularly in maintaining a consistent brand experience across all channels and ensuring data security and privacy.

Training staff to adapt to new technologies and sales approaches is another critical component.

Employees must be equipped with the skills to handle digital inquiries, manage online sales processes, and deliver the same level of personalized service online as they do in person. This shift also necessitates a change in dealership culture, emphasizing flexibility, customer-centricity, and innovation.

Role of sustainability

Sustainability is becoming a driving force in consumer purchasing decisions, particularly in the electric vehicle market. As more consumers prioritize environmental impact in their vehicle choices, dealerships must align their operations and offerings with these values. This includes not only selling EVs and hybrid models but also implementing sustainable practices in dealership operations, such as reducing energy consumption, minimizing waste, and adopting green technologies.

Promoting sustainability can also be a key differentiator in the competitive automotive market.

Dealerships that highlight their commitment to environmental responsibility can attract a growing segment of eco-conscious consumers. This approach aligns with the broader industry trend towards electrification and sustainability, positioning dealerships as forward-thinking partners in the transition to cleaner transportation.

Broader implications for the automotive ecosystem

The shift to omni-channel retailing and the emphasis on sustainability have broader implications for the automotive ecosystem. Manufacturers must work closely with dealerships to facilitate a seamless customer journey, from online research to vehicle delivery. This collaboration can extend to developing shared digital platforms, co-creating marketing strategies, and providing training and support for new technologies.

Furthermore, the rise of EVs and the focus on sustainability are accelerating changes in automotive design, manufacturing, and supply chain management. Manufacturers and suppliers are investing in cleaner production processes, renewable energy, and recyclable materials, reshaping the industry’s environmental footprint.

Preparing for the future

As dealerships adapt to the omni-channel model and embrace sustainability, they are not just responding to current market dynamics but preparing for the future of the automotive industry.

This transition requires a long-term vision, investment in technology and people, and a commitment to continuous improvement.

The success of this transformation will depend on dealerships’ ability to innovate, adapt, and meet the evolving expectations of consumers. Those that can effectively integrate digital and physical experiences, offer personalized and sustainable options, and build strong customer relationships will lead the way in the new era of automotive retailing.

Conclusion

The pandemic has accelerated a seismic shift in the automotive retail landscape, with profound implications for dealerships. The shortage of new and used vehicles has temporarily reinforced traditional retail methods, but the growing days’ supply signals a need for change.

As consumer expectations evolve towards a more digital, convenient, and personalized buying experience, the adoption of an omni-channel approach becomes critical. Dealerships that embrace this shift, leveraging technology to integrate online and offline experiences, will not only survive but also thrive in the new era of automotive retailing. The journey ahead is challenging, but for those willing to innovate and adapt, it offers a road filled with opportunities.

Jim O’Brien is general manager of the America’s for RAVIN AI

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The Cox Automotive Dealer Sentiment Index for the first quarter of 2024 shows dealers’ view of the market has improved only slightly, up to 42 (out of 100) from Q4 2023’s dismal score of 40 — the lowest since the beginning of the COVID pandemic in the spring of 2020.

But looking ahead, the score for what dealers are expecting three months from now took a giant leap from the record low 41 of the previous survey, up 10 points to 51. That’s just above the midpoint of 50, indicating more dealers believe the market will be strong than weak.

Cox analysts pointed out the Q1 survey typically shows a “spring bounce” as dealers look forward to the spring selling season.

The survey showed profitability, customer traffic and costs are dealers’ main concerns in the here and now. The overall profitability index of 33 is the second-lowest ever, behind only the pandemic shutdowns of Q2 2020. That score has dropped steadily since its peak of 60 in Q3 2021.

The decline has been especially precipitous among franchised dealers, whose profitability index fell 10 points in the past quarter to 41. That’s less than half of its 2021 high point of 86 and the first time since the pandemic that it’s been below the 50 threshold. The score for independents matched its post-pandemic low at 31.

“The vehicle market in the U.S. is shifting from a seller’s market to a buyer’s market, and dealers are feeling the pinch of tighter margins and higher costs,” Cox Automotive chief economist Jonathan Smoke said. “After some highly profitable years for many dealers, 2024 will be a tough comparison.

“Dealer costs continue to grow and profitability per sale has dropped. As we often see in our surveys, spring is bringing some optimism, but dealers are clearly indicating the U.S. auto market is very different than it was just two years ago.”

Sales environment still down

Dealers said the current sales environments for both new and used vehicles have improved over last quarter but are still down year over year. The new-vehicle sales index was up one point to 52, down from 57 one year ago. The used-vehicle index also rose one point, to 40, but is below the 44 posted in Q1 2023 and well below the long-term index average of 50.

Among franchised dealers, the used-vehicle sales index continued to hover at its post-pandemic low of 51, while the independents’ score was up a point at 36.

The new-vehicle inventory index reached an all-time high of 75 in Q1, soaring 13 points from the previous quarter and 50 points since Q1 2022, when low new-vehicle supply was among the most cited factors holding back business.

Used-vehicle supply, other the other hand, is still an issue, with a score of 45 indicating inventory is declining rather than growing. That seems to be more of a problem for independents, who gave it a score of 42, compared to 53 for franchised dealers.

Dealers as a whole are still less than optimistic about the overall U.S. economy, with the index of 42 – well below the 50 threshold – indicating weakness, though it was up from 39 in Q4. Independent dealers, whose score rose four points to 40, drove that increase.

Interest rates, the economy and market conditions remained the top three factors seen by dealers as holding back their business. But the percentage of dealers citing each decreased in Q1, with interested rates at 62% (down from 65%), the economy at 55% (down from 61%) and market conditions at 40% (down from 48%).

EV sales sink to record low

The majority of dealers said sales of electric vehicles are worse than they’ve been since that category was added to Cox Automotive’s index in Q2 2021.

The current index fell to a record low 42, down from 48 in the previous quarter and 50 a year ago. The three-month outlook for EV sales plummeted as well, falling six points to 36, also a record low. That’s down 17 points year-over-year, when dealers were optimistic EV sales were poised to take off.

“The drop in dealer sentiment related to electric vehicles is understandable when we look at where EVs stand on the adoption continuum – shifting from early-adopter buyers to mainstream,” Cox Automotive director of industry insights Stephanie Valdez Streaty said. “In 2024, the Cox Automotive team expects the industry to fully acknowledge the fact that the average consumer needs to be convinced on the merits of going electric, and many won’t be easily persuaded.

“The EV market is likely to see a rise in the number of models, incentives, discounting and advertising. However, selling more EVs will require more effort on the part of dealers.”

Methodology

The Q1 2024 Cox Automotive Dealer Sentiment Index is based on a survey of 1,018 U.S. auto dealer respondents, comprised of 546 franchised dealers and 472 independents. The survey was conducted from Jan. 30 to Feb. 13, 2024.

Dealer responses were weighted by dealership type and sales volume to represent the national dealer population.

For each aspect of the market surveyed, respondents are given an option related to strong/increasing, average/stable or weak/decreasing, along with a “don’t know” opt-out.

Indices are calculated by creating a mean score in which:

Strong/increasing answers are assigned a value of 100.

Average/stable answers are assigned a value of 50.

Weak/declining selections are assigned a value of 0.

Respondents who select “don’t know” at a particular question are removed from the related index calculation.

The full results can be downloaded here.

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This after what appeared to be sluggish start to 2024.

Citing data from its vAuto business unit, Cox Automotive estimated that used-vehicle retail sales in February climbed 18% month-over-month and 5% year-over-year.

The company said in a Data Point report Monday that CPO sales were up 5% month-over-month and 2% year-over-year.

Cox is forecasting a 3% year-over-year hike in CPO sales this year, with sales projected at 2.7 million units.

In the first month of 2024, however, certified sales were off to a slow start.

Cox estimated in February that CPO sales for January were down 12% month-over-month and even with January 2023 figures.

In his latest Kontos Kommentary report, ADESA chief economist Tom Kontos shared preliminary January used-car sales figures from the National Automobile Dealers Association that show “2024 is off to a slower start than any of the previous five years.”

The 1.99 million used-car sales from franchised and independent dealers in January, per NADA estimates in the Kontos report, was down 6.3% year-over-year.

It was off 7.5% from January 2022, down 10.4% from 2021, down 13.3% from 2020 and 10.1% softer than January 2019.

Franchised dealers moved 985,325 used vehicles in January (down 6.3% year-over-year drop), according to the NADA estimates cited by Kontos. Independents sold 1,008,076, also a 6.3% decline.

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