Tuesday, 6 May 2014

Used Car Demand Keeps Prices High in First Quarter - Toyota Motor ...

Used <b>Car</b> Demand Keeps <b>Prices</b> High in First Quarter - Toyota Motor <b>...</b>

Used <b>Car</b> Demand Keeps <b>Prices</b> High in First Quarter - Toyota Motor <b>...</b>

Posted: 05 May 2014 07:25 AM PDT

Sales of used vehicles slipped 6.7% in the first quarter of 2014, from 9.8 million units in the year-ago quarter to 9.1 million units this year. Franchised sales were up 11% at 2.8 million, with the decline coming from private party and independent dealer sales, which were down 11.4%.

The average retail price for a used vehicle at franchise dealers was $16,090, up 1.4% sequentially and up 1.7% year-over-year for the quarter. Even with higher volume, franchise dealers were able to keep the price higher, indicating that demand for used vehicles remains high. The data come from auto industry research firm Edmunds.com.

New vehicle sales totaled about 29% of the market in the first quarter, compared with 71% of sales for used vehicles. That is a sequential rise from 68%, but down from 72.6% in the first quarter of 2013.

The top five auto sales segments by market share are midsize cars (9.4%), compact cars (9.3%), large trucks (7.4%), entry-level luxury cars (7.1%) and midrange luxury cars (6.2%). The leading model by first-quarter sales in each of these segments is:

  • Midsize cars: Accord, from Honda Motor Co. Ltd. (NYSE: HMC)
  • Compact cars: Civic, from Honda
  • Large truck: Silverado 1500, from General Motors Co. (NYSE: GM)
  • Entry-level luxury cars: 3 Series, from BMW
  • Midrange luxury cars: E-Class, from Mercedes

ALSO READ: Toyota Camry Holds Spot at No. 1 Car in America

The largest change in market share among the top-selling models came in the entry-level luxury SUV category, where the Lexus RX 350 from Toyota Motor Corp. (NYSE: TM) rose to 10.8% share. All top five categories with the largest positive share changes were SUVs. The RX 350 was followed by the Honda MDX (10.5%), Honda CR-V (5.2%), Chevrolet Equinox (4.5%) and Chevrolet Acadia (3.8%).

The largest quarterly declines in market share came in these segments:

  • Premium sport car: Mercedes SL-Class, down 16.3%
  • Large car: Chevy Impala, down 10.8%
  • Compact truck: Toyota Tacoma, down 10.4%
  • Premium luxury SUV: Cadillac Escalade, down 8.8%
  • Midrange luxury car: Mercedes E-Class, down 6.3%

The analysts at Edmunds.com expect new car sales and leasing to remain strong in the second quarter, easing demand for used vehicle inventory. Low borrowing costs and advantageous leasing deals could boost new car sales. For used vehicle sales, Edmunds.com says lower income consumers are staying out of the market during the uneven economic recovery, especially in private party sales and at independent dealers.

ALSO READ: States With the Most Drunk Driving

By Paul Ausick

Used <b>Car Prices</b> Are Softening, but It&#39;s Not Just from Off-Lease | Au

Posted: 29 Apr 2014 02:55 PM PDT

Used Car Prices Are Softening, but It's Not Just from Off-Lease | A

Used Car Prices Are Softening, but It's Not Just from Off-Lease

Yes, lower used car prices are just around the cor­ner; and no, it's not just about off-lease units see­ing big vol­ume increases.

Experts like NADA Used Car Guide ana­lyst Larry Dixon and Black Book's Ricky Beggssee price declines, with much of it com­ing from sea­sonal pat­terns – and from what hap­pens his­tor­i­cally when used car prices sky­rocket to abnor­mal lev­els. Now, they're com­ing down to get back in line, Dixon said.

As April closes, Dixon expects eight-year-old and newer vehi­cles will see a 2% price drop from March lev­els – and that should fall another 3% in May. It does tend to hap­pen – "When see [the prices] rise dra­mat­i­cally, they tend to fall dra­mat­i­cally," he said. "We've seen this cycle before."

Beggs saw that used-vehicle prices remained strong in April, but Black Book research has been indi­cat­ing that by mid-April, deal­ers were bid­ding less aggres­sively. Mid-size and com­pact cars took the biggest hit. Pickup trucks are retain­ing their value and that should con­tinue with all the demand com­ing from hous­ing and construction.

Dixon does acknowl­edge that the pre­dicted down­ward price trend is here, and that March was unex­pect­edly high due to pent up demand fol­low­ing the harsh weather con­di­tions of Jan­u­ary and Feb­ru­ary. He cites tight used-vehicle sup­ply com­ing from car rental com­pa­nies hold­ing their cars longer than usual to sat­isfy replace­ment car demand fol­low­ing weather-related acci­dents and to meet demand gen­er­ated by mas­sive vehi­cle recalls.

Auc­tion vol­ume was down 4% in March – that was sur­pris­ing to Dixon given the growth in off-lease vehi­cles. He thinks that auc­tion vol­ume was thrown off by deal­ers pur­chas­ing many of these units from lessors before they arrived at auc­tions. But pay atten­tion to off-lease vehi­cles – it is grow­ing. "Its tra­jec­tory is up, not down," Dixon said.

2014 Automotive Information Network, Inc. All Rights Reserved.
Posted by at

No comments:

Post a Comment

Subscribe to: Post Comments (Atom)