1. Lease Returns to Create Used Car Glut


Speed Read:

Edmunds Q4 2013 Used Car Mar­ket Report just came out on Feb­ru­ary 11th.

Found that year-over-year used car prices are falling & could fall anoth­er 2% in next year.

Drill-Down Details:

  • Glut of vehi­cles of used cars will dri­ve down prices as much as 2% in 2014
  • Drop in used car prices will affect mar­ket and all car buy­ers
  • Trend will cause a rip­ple effect, influ­enc­ing shop­pers of both new & used cars
  • New- and used-car mar­kets feed off each oth­er
  • Boom in new car leas­es is lead­ing to a high­er num­ber of lease returns
  • Adds to grow­ing inven­to­ry of used cars, forc­ing their prices down
  • Drop in used-car val­ues; rise in the month­ly pay­ments of new car leas­es.
  • Soft­er resid­ual val­ues cause high­er month­ly pay­ments
  • Pro­vides deal­er with bet­ter cer­ti­fied pre-owned (CPO) car offers
  • Low­er vehi­cle trade-ins offers leads to high­er retail vehi­cle inven­to­ry


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