Editor’s Notebook: Five Interesting Remarketing News Items of Past Week

By Jon LeSage, Edi­tor, Used Car Mar­ket Reports

  1. CPO awards: Kia took the Best Pop­u­lar Pro­gram Award and Jaguar won the top spot in Best Pre­mi­um Pro­gram Award at the 17th annu­al Intel­li­Choice Cer­ti­fied Pre-Owned Car Awards. “Jaguar and Kia both edged out Vol­vo and Hyundai for the best pro­grams by hav­ing bet­ter spe­cial financ­ing offers over the last year,” said IntelliChoice’s Eric Ander­son. Audi, Ford, Hon­da, and GMC were all rec­og­nized with awards in key vehi­cle cat­e­gories dur­ing Vincentric’s CPO awards. Both award shows took place at Used Car Week in Scotts­dale, Ariz.
  2. Sales fore­cast: “New light-vehi­cle sales will rise to 17.71 mil­lion units in 2016, a 2.3% increase from our fore­cast of 17.3 mil­lion sales in 2015. This would mark the sev­enth straight year of increas­ing U.S. new-vehi­cle sales,” said Steven Sza­kaly, chief econ­o­mist at NADA. Mod­er­ate wage growth, declin­ing gaso­line prices, and con­tin­ued low inter­est rates on auto loans will dri­ve sales up next year, he said. Sza­kaly thinks that with­out heavy automak­er incen­tives, new-vehi­cle sales will reach a peak in 2016.
  3. Used car vend­ing machine: Online car sell­er Car­vana has con­struct­ed a five-sto­ry, glass-encased, vend­ing machine next to Inter­state 65 near Nashville filled with used cars ready for pick­up. Car buy­ers acquired them on Carvana’s site; the vend­ing machine-style park­ing lot was assem­bled when Car­vana found that con­sumers do actu­al­ly want to expe­ri­ence of going there and pick­ing up their car. Car­vana is also sav­ing mon­ey on deliv­ery costs for used vehi­cle sales.
  4. New third-par­ty site: J.D. Pow­er and Asso­ciates has joined the world or third-par­ty auto sites by launch­ing a new vehi­cle rat­ings and research site. Site fea­tures include: qual­i­ty rat­ings, per­for­mance and design rat­ings, depend­abil­i­ty and reli­a­bil­i­ty rat­ings, pric­ing with MSRP and invoice, fuel econ­o­my and vehi­cle specs; and robust search tools for new, used, and CPO vehi­cles in local deal­er inven­to­ry.
  5. SUV sales growth: Ford thinks that SUVs will make up 20% of new vehi­cle sales in the U.S. by 2020. That will come from Baby Boomers emp­ty­ing their nests and their grown Mil­len­ni­al off­spring start­ing their own fam­i­lies. Oth­er mar­ket dri­vers would be low gaso­line prices, cheap car loans, and the abil­i­ty to car­ry large loads of pas­sen­gers and car­go. Ford’s def­i­n­i­tion of SUVs will be broad with the com­pact SUV Ford Escape a big part of the automaker’s mar­ket­ing dri­ve and fore­cast. Auto­da­ta includes SUVs and sport wag­ons in its sales num­bers, and crossovers like the Toy­ota RAV4 are usu­al­ly includ­ed in sales analy­sis fig­ures by automak­ers and ana­lysts when look at the SUV mar­ket.
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