As used car prices decline by 5% year-over-year, dealers and consumers alike are navigating a shifting landscape. In this episode of CBT Now, Rebecca Lindland, Senior Director of Industry Data and Insights at Cars Commerce, breaks down the key factors behind this trend, the impact on dealers, and what the future holds for the automotive market as we enter the third quarter of 2024.
Key Takeaways
1. The 5% year-over-year drop in used car prices is primarily attributed to improved inventory levels and vehicle availability. However, the available stock tends to be older and has higher mileage.
2. While increased inventory is beneficial for consumers, it poses challenges for dealers, who must carefully manage supply to remain profitable and competitive.
3. The decline in trade-in values provides a unique opportunity for dealers with unique opportunity lanes to acquire more vehicles by engaging consumers who come in for service appointments.
4. Price fluctuations in the used electric vehicle (EV) market continue as interest grows. Consumers are increasingly drawn to used EVs due to more inventory and the appeal of avoiding the high costs of new EVs.
5. Key trends to watch for the remainder of 2024 include potential interest rate cuts by the Federal Reserve, which could drive market activity, and the ongoing monitoring of consumer confidence and employment stability.
“We really believe in leveraging the service drive. When a consumer comes in for service, particularly with a three to five-year-old vehicle, talk to them about trading it in. Trade-in prices are softening, so now is really the time to get the best deal.” – Rebecca Lindland.
