Buying A New Or Used Vehicle? Hold Your Horses - Lower New Car Inventories, Out of Sight Used Car Prices, A Year Of New Car Hots All Add Up To a Car Dealers Dream
TACH's TAKE: Unless your current vehicle can't continue to do its job wait until the selling field is more rational to fill your new car desire.
Atlanta (Out Of Auto Gasoline), GA - May 12, 2021: Cox Automotive reported that new and used vehicles continue to be in high demand and, as seen at gas stations across the South right now, when supply dips, consumers come calling, many with their wallets wide open.
In fact, more than 40% of car shoppers are willing to pay above MSRP right now, and those willing to pay over MSRP are willing to accept a 12% premium, aka $5,000 over sticker. That fact was one key takeaway from a recent snapshot consumer poll undertaken by our research team. Bottom line: New-vehicle shoppers in the U.S. have their eyes wide open and are expecting limited choices and high prices.
Auto retailers are also paying big prices, as tight supply in the wholesale lanes is pushing auction values even higher. As noted last Friday, the Manheim Used Vehicle Value Index marked an all-time record, again. Wholesales prices serve as a crystal ball for retail prices, and current retail list prices for used vehicles are already near record highs. Check back to the Cox Automotive Newsroom in the coming days for updates on inventory.
Two additional items in the hopper right now:
Our Kelley Blue Book team finalized their Q1 Brand Watch data. The quarterly reports offer insights into consumer shopping behavior and showcase how different brands and products compare in a dozen key factors. The team produces separate Brand Watch reports for non-luxury and luxury brands each quarter, and the most recent reports have been posted in the Newsroom. You can find them here:
Q1 2021 Kelley Blue Book Brand Watch Report: Tesla, Volvo Gain While BMW, Mercedes-Benz Slip
Q1 2021 Kelley Blue Book Brand Watch Report: SUVs Hit Another Record; Subaru Models Ride the Wave
While inventory is tight, access to auto loans is becoming more available. Our analysts from Dealertrack post a monthly Credit Availability Index and offer insight on the market for auto loans. The data from April was posted yesterday. Auto credit availability is an important measure for the industry, as roughly 80% of vehicle purchases include an auto loan of some sort. Thankfully, credit is more plentiful than vehicle inventory right now.