Remarketing Trends to Watch through the End of 2013

For those fol­low­ing remar­ket­ing trends, they’ve seen that used car prices have been fluc­tu­at­ing this year in whole­sale and retail trans­ac­tions. Sky­rock­et­ing whole­sale prices that occurred in the first half of 2011 have been bob­bing up and down since that time. What are the fore­casts for the rest of this year, along with oth­er met­rics that shape remar­ket­ing prof­its? Here’s what experts are say­ing, along with a few trends to track as the year pro­gress­es…..

  1. Sup­ply is increas­ing, and there’s debate over whether that means prices will be strength­ened or weak­ened. Sup­ply growth is com­ing from off-lease vehi­cles, rental return, com­mer­cial fleet lease, and more aggres­sive lend­ing.
  2. ADESA’s Tom Kon­tos says that grow­ing whole­sale vol­umes should keep down­ward pres­sure on prices.
  3. Man­heim Consulting’s Tom Webb thinks “sup­ply will be exces­sive rel­a­tive to demand.”
  4. As for recent mar­ket trends, Webb and has seen whole­sale pric­ing increase in the Man­heim Used Vehi­cle Val­ue Index – that’s com­ing from low inven­to­ries and high trans­ac­tion prices in new vehi­cle mar­ket, plus strong prof­it oppor­tu­ni­ties in the retail used vehi­cle mar­ket.
  5. In the lat­est Guide­lines, NADA sees used price loss­es con­tin­ue to be mild and expects favor­able cred­it con­di­tions to help spur over­all demand; prices should rise by 1% this year.

Mar­ket dri­vers to watch through end of year:

  1. Kon­tos thinks whole­sale vol­umes will grow and soft­en prices; it will also increase the avail­abil­i­ty and selec­tion of used vehi­cles for deal­ers.
  2. Art Spinel­la and Tom Webb have been report­ing on strong sales vol­ume in retail used vehi­cle sales.
  3. If prices are soft­en­ing, deal­ers are mak­ing up for it by increas­ing vol­umes; that’s dif­fer­en­ti­at­ed by local mar­ket demand and the diverse vehi­cle offer­ings deal­ers can tap into. So, it’s expect­ed to be a good year for used vehi­cle prof­its if the inven­to­ry man­age­ment is done the right way by each mar­ket.


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