|
The U.S. auto industry is enjoying the greatest run on record. If all goes according to plan, auto dealers will report six straight years of sales growth in 2015. Although the focus of the industry has always been on new vehicles, it's actually used cars that sell in higher numbers. In fact, car shoppers are more than twice as likely to leave the dealership with a secondhand auto than a brand-new one. It is no wonder the amazing recovery in auto sales is being fueled by these vehicles. New car dealerships were pleased when the price of the average pristine auto jumped by 1.9 percent in 2014. At the same time, however, used car dealers reported price increases of 5.1 percent! The increase was even greater for pre-owned trucks. According to industry insiders, secondhand truck prices surged more than 6 percent last year. Why? Here are a few explanations. Lower Gas Prices Because they typically aren't as fuel efficient as cars, trucks sales took a huge hit when gas prices skyrocketed in 2014. Now that prices have fallen to more affordable levels, these vehicles are once again a hot commodity. This is true of every type of truck, from pickups to SUVs, vans, and commercial vehicles. Large Inventory Although few drivers were buying trucks when fuel costs rose, lots of them were selling. Trading these perceived gas-guzzlers in for more efficient rides became a frequent occurrence at car lots across the nation. Now, those same lots are selling their stockpiles as fast as they can. Homebuilding When the housing crisis hit, the construction industry took a brutal beating. Workers who were building homes at a record pace suddenly found themselves out of work. As a result, many of them traded in their old pickups for used cars. Now that the housing market is recovering, these same workers are once again purchasing rugged, reliable transportation. Certified Vehicles As important as all of those factors have been, the biggest thing to happen to the entire used auto industry is the growth of certified pre-owned (CPO) vehicle programs. Unlike ordinary used cars, these automobiles offer buyers a guarantee against fraud and defect. Backed by extended warranties from their manufacturers, these vehicles give dealers the ability to make much higher profit margins, which are comparable to those of new automobiles. In just the past few years, sales of CPO autos have gone from a mere blip on the radar to a substantial portion of the pre-owned market segment. According to a recent report from Edmunds.com, certified automobiles accounted for more than one-fifth of the total used auto sales. Easily a record high, that proportion is only expected to rise in the foreseeable future. As impressive as they may be, sales of new automobiles are dwarfed by those of pre-owned models, both in number and in price appreciation. When they're looking for used cars, Ann Arbor drivers should check out http://www.dunningtoyota.com/used-inventory/index.htm.
Related Articles -
used, cars, ann, arbor,
| 
