NADA: VW Diesel Car Vs. Gas Prices, Haig: Fixed Ops and F&I Helping Dealers December 23, 2015

November Used Prices Double Decline from Previous Year

Jonathan Banks
Executive Automotive Analyst
NADA Used Car Guide

While November’s used vehicle prices declined 1.9%, nearly a percentage point above October’s 2.7% decline, it was nearly double the decline of last November’s 1% slide. Compact cars continued their steep decline – 2.7% in November and almost 16% down for the year – 4-percentage points worse than for all of 2014. Light trucks continued performing well with compact utility, midsize utility and large pickup prices down an average of 1.5%; and mid-size pickup and large SUV were each down about 1%.

Here’s the latest edition of Guidelines

NADA UCG Sees Prices for Vehicles Up to 8 Years Old Down 1% from November:
Subcompact and compact cars expected to fall 1%, and luxury car and utility should be down 1% to 1.5%.

Trade-in Values for Cars Down 2.4% from November and Trucks Down 1.9%:
Large car and sport car values took the biggest hit, falling by an average of 3.2%.

Since VW’s Emissions Violation, Diesel Engine Jettas and Passats Have Fallen 13% to 16%:
Gasoline powered Jettas and Passats have fallen by lesser 6% to 10% during that time.
Haig_Alan_Haig Partners2

Conditions Staying Strong for Buying and Selling Dealerships

Alan Haig
Haig Partners

Private buyers are the biggest driver for dealership acquisitions this year. That number increased 34% in the first nine months of 2015 compared to the same period in 2014. Growth is leveling off from the boom in major acquisitions that took place in 2014, but remains a very strong market for buying and selling. Luxury franchises continue to bring the strongest interest from buyers. Honda, Toyota, and Subaru also remain attractive to most buyers, along with an increase in interest for domestic brands.

Here’s The Haig Report for third quarter 2015

Biggest Challenge is Erosion of Gross Profits in New and Used Vehicle Sales:
Decline driven by OEM stair stepping programs, turn and earn policies, TrueCar, and ease consumers have in comparing prices on mobile devices.

Fixed Operations and Finance & Insurance Departments Seeing Higher Profits:
Higher profits from fixed and little expense against revenue in F&I helps dealer profits.

Used Car Market Will See Growing Supply from Strong New Vehicles Sales in Recent Years:
Should help boost dealer profits since some franchisees seeing more profit in used cars than new cars.
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Kontos video Nov 2015
Kontos Kommentary November 2015 Edition

ADESA Ana­lyt­i­cal Ser­vices is see­ing signs of price soft­ness in three broad areas when you really drill down into the data.

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Car Buying: Women Adopting Technology Faster Than Men

Women are more com­fort­able with using tech­nol­ogy in the car buy­ing process than men, but be care­ful not to pro­file women or men.

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