As the world turns onto the 2020 freeway, it’s time to put 2019 in the rearview mirror and take a look at what the experts expect for the auto industry in the year ahead. Will used-vehicle prices continue their wild ride? Will new-vehicle sales continue to slump? What can you do to take advantage of what the experts say is waiting up the road in 2020?
New-Vehicle Sales Will Continue to Stall
The past few years have been difficult for new-vehicle sales, according to projections published by statista.
And the pain isn’t only being felt in the United States. CNBC reports that by the time New Year’s Eve rolls around, 2019 could see the steepest drop in new-vehicle sales since the Great Recession.
Used Vehicles Will Continue to Sell Well
Back in March 2019, Edmunds predicted that used vehicle sales would set records in 2019, and it looks like the experts were right. Well guess what, they’ve done it again.
In this article posted on liveabout.com, Jessica Caldwell, an Edmunds executive director of industry analysis, is quoted as saying that “used vehicles will likely grow in popularity … .” She qualified her assessment by adding that the sustained interest in used vehicles would depend on what incentives are offered on new vehicles and whether interest rates continue to creep up.
This is good news for the used vehicle industry.
Prices Will Decline
It’s not all good news for the industry, though.
According to an article posted on Auto Remarketing, experts with the RVI Group say there is expected to be an increasing supply of used vehicles–and incentive activity is expected to grow. Combined, this is the recipe for a decline in used-vehicle prices.
This puts consumers in the driver’s seat when it comes to making deals. They’ll be looking for vehicles that are clean, in exceptional running condition and ready to roll. It’ll put pressure on you to offer exceptional inventory–making it more important than ever for sales professionals to maximize profits by ensuring that their used car reconditioning process is as efficient and effective as ever.
Spring Will Be Busy
Tax refund season and used vehicle purchases seem to go hand-in-hand. In 2018 and 2019, purchases of used vehicles jumped between 20 and 30 percent, and the experts at Cox Automotive see no reason why that trend won’t continue in 2020. The refunds usually start hitting around the ninth week of the year, which launches the busy buying spring season that continues for another six or seven weeks.
One key to taking advantage of this ongoing trend is to make sure your inventory is ready to roll, which means having your used car reconditioning process in tip-top shape.
Reconditioning Is the Path to Improved Gross Margins
So it looks like 2020 will be a mixed bag for used vehicle sales–higher interest, lower prices.
This means squeezing every penny out of used vehicles will be more important than ever, and that starts with used car reconditioning.
Used car reconditioning comes down to speed, quality and price. To succeed, you’ll need to closely monitor your process so you can make sure you’re getting the lowest price, the most efficient service and the highest-quality parts.
This year, you may want to invest in ReconTRAC. It doesn’t just track your used car reconditioning process–it monitors and fixes it. Visit recontrac.com today to get started.