ADT Report Sees Continued Strength in Used Car Market
27 January 2000
Company Releases 2000 Used Car Market Report at NADA Convention
NASHVILLE, Tenn.--The 1999 used car market was the strongest since 1995, suggesting that demand for used vehicles remains strong despite the best new car market in history, according to ADT Automotive's 2000 Used Car Market Report.The Report, released today at the National Automobile Dealers Association annual convention in Orlando, is the fifth edition of the annual comprehensive study of new and used vehicle sales and auction activities conducted by ADT Automotive, a vehicle auction and logistics company with 28 U.S. wholesale auto auctions.
According to the Report, 1999 was a year that saw simultaneous strength in the new and used vehicle markets, resulting in a combined market value of more than $700 billion. New vehicle sales came in at 16.9 million units, demolishing the old record of 16.1 million set in 1986. For used vehicles sales, total volume reached 40.89 million units (the second best volume ever behind 1995, when 41.76 million used vehicles were sold). And, even with the record new vehicle sales year, used vehicles represented more than two-thirds of the vehicles sold for the year and more than half the value of the combined markets ($361 billion).
"We continue to be the beneficiaries of some of the strongest sales trends in the history of our industry, which helped lead 1999 to be the best year ever for our auctions," said Tony Moorby, president and chief executive officer of ADT Automotive. "We anticipate continued high used vehicle sales volumes for the next five years and expect to see the record set in 1995 to be nearly matched in this coming year and exceeded by 2001."
The Report shows that leasing hit a high of 4.1 million units in 1999, and predicts that this volume will stabilize over the next four years to levels between 3.5 million and 3.9 million units. The Report predicts between 1.8 million and 1.9 million off-lease vehicles will be remarketed annually through auctions for the foreseeable future.
"We've seen a lot of new factors play a role in the industry over the last several years -- the explosion of leasing, the Internet, new car incentives and the popularity of certification -- all of which have had a positive impact on the used car market," said Tom Kontos, director of strategic planning and market analysis for ADT Automotive.
Other features of this year's Report include:
| -- | The Report estimates that Internet-based new and used vehicles sales in 1999 were more than 1.5 million units -- up 6 percent from 1998. Of those vehicles, 1,054,000 were new and 457,000 were used. |
| -- | Superstores became less of a factor in vehicle remarketing in 1999, with the exit of AutoNation leaving CarMax as the only major player in this once-promising concept. |
| -- | Certification programs continued to draw attention last year, as manufacturers, banks, automotive finance companies and other remarketing entities have entered the certification arena. Consumer research shows the top two items consumers consider most important in choosing a certified vehicle are the warranty and the inspection process. Among certified used vehicle buyers, 72 percent rated their certified used vehicle "truly outstanding" or "excellent," and 66 percent would purchase another certified used vehicle. |
The 2000 Used Car Market Report relies on statistical data composed of proprietary research as well as data from The Polk Company, Goldman, Sachs & Co., Bobit Publishing, the National Automobile Dealers Association, CNW Marketing/Research, J.D. Power and Associates, the National Auto Auction Association, and others.
Copies of the Report are available for $25 and may be obtained by contacting ADT Automotive's Market Analysis department, 615/781-3212.