Used car sales are climbing as new vehicle sales are falling. Thanks to rising new car prices and interest rates, along with the ever-increasing number of off-lease vehicles, dealers should be relying on their used car departments more than ever. Auto Credit Express can help bolster your used vehicle strategy and expand your store's reach as customer preferences shift.
Automotive Industry Trends Highlight Importance of Used Cars
A number of auto industry trends point to an increased importance for your dealership's used car business. Both J.D. Power and Edmunds are predicting big things for used vehicle sales as new car sales taper off:
- J.D. Power data shows that used vehicle sales at franchised dealers were on a record pace in the first quarter of 2019. At 3.5 million, sales were up 5.1 percent over the first quarter of 2018.
- Edmunds analysts predict that used car sales in 2019 are going to reach the highest level since the recession. After 40.2 million used vehicle sales in the US in 2018, they're predicting sales could approach 41 million in 2019.
Typically, the industry sees new and used cars follow a similar pattern. If new is up, used is up, or vice versa. Now, we're seeing new vehicle sales fall while used car sales rise. There are several reasons why:
- Rising new vehicle prices – According to the latest Kelley Blue Book data, the average transaction price for a new car in the US increased two percent in April 2019 year over year. This is undoubtedly playing a role in pushing buyers out of the new vehicle market.
- Price gap between used and new cars widening – At the same time, Cox Automotive analysts are projecting used vehicle prices to drop 1.8 percent in 2019. As the price gap between the two increases, it's going to drive more buyers toward more affordable used cars.
- Increased supply of used vehicles – Stop us if you've heard this one before, but a record number of off-lease cars are expected to be returned to dealership lots this year. This ever increasing supply of quality late model used vehicles means consumers have more options than ever to consider.
- Rising interest rates – While the Fed decided not to raise rates in early May, auto loan interest rates have still been climbing recently. In fact, Edmunds data showed that the average rate on a new car loan reached a 10-year high in April. It's yet another reason consumers are looking at the used vehicle market more as they try to spend less.
Increase Used Car Sales at Your Dealership
With all of these industry factors putting downward pressure on new car sales, there's never been a better time to sharpen your focus on your used vehicle strategy. If things continue to head in the current direction, used car sales have the potential to contribute more to your bottom line.
Auto Credit Express wants to help your team sell more used vehicles. Our used car leads are powered by CarsDirect Connect and can help keep a steady stream of potential buyers coming through your doors. The timing is ripe to take advantage of all we have to offer:
- Expand your reach – Our network of automotive websites gets over 35 million visits each month. By listing your inventory across our more than 130 websites, you can increase exposure and connect with new shoppers.
- Real-time analysis – Get access to real-time reporting scorecards so you can review current and past leads and tailor your inventory based on what you're seeing.
- Friendly to any budget – You can choose a used vehicle lead program on a subscription basis or a pay-per-lead basis.
As your used car department becomes more important to your bottom line in this changing automotive landscape, Auto Credit Express wants to help you along the way. Your sales staff can focus on selling vehicles, and we'll focus on driving more leads to your dealership.
In addition to our used car leads, we also offer industry-pacing subprime auto leads and new car leads. Plus, our additional dealer products, from our call center and BDC services to our targeted direct mail campaigns, can help your store boost its bottom line.
Call us today at 888-535-2277 to learn more, or you can fill out our online contact form and we'll get back to you with all the details you need!