REPORT: USED CAR SALES STRONGER THAN EXPECTED IN FIRST HALF OF 2016
- August 25, 2016
- Posted by Stas Shilman
- Comments Off on REPORT: USED CAR SALES STRONGER THAN EXPECTED IN FIRST HALF OF 2016
At the start of 2016, a number of analysts predicted a sharp drop in used car prices and values. A look at the numbers through July, however, has shown that used cars have performed relatively well, despite the increase in used vehicle inventory and attractive incentives for new car sales.
According to Automotive News, analysts initially predicted a slump in the used car market because of a glut of vehicles coming off of lease. The AN report estimates 3.1 million off-lease vehicles to enter the market by the end of 2016, an increase from 2.3 million last year. That said, experts predicted used car values would slide 3 to 5 percent this year.
However, that hasn’t been the case. Demand for pickup trucks is one reason for the resilient used vehicle values. According to the report, subcompact and midsize car values are lower year-over-year, but strong used truck sales have offset the slump in weaker segments. The report also credits stronger Certified Pre-Owned sales with CPO inventory that appears to be priced more competitively than it has been in the past.
Experts believe used car values won’t fare as well in the second half of the year. Automakers generally ramp up new car incentives towards the end of the year, which could pull more customers away from pre-owned vehicles.