Road Ahead: Used Car Dealers in the US Industry Market Research Report Now ...
24.05.12
In the five years to 2012, US automakers struggled to stay afloat. Before filing for Chapter 11 bankruptcy in 2009, General Motors and Chrysler accepted nearly $25.0 billion in government assistance. Turmoil in the market for asset-backed securities eroded the balance sheets of auto financiers, triggering dramatic tightening of credit standards and availability. While Used Car Dealers industry operators “have a similar structure and are sensitive to some of the same factors that new car dealers face, the industry weathered these challenges much better than other industries in the automotive sector,” says IBISWorld industry analyst Radia Amari. Over the five years to 2012, industry revenue has contracted at an annualized rate of 3.7% to $71.6 billion. In 2012, revenue is expected to grow about 1.2%, supported by financing revenue from credit-poor consumers, despite losses of customers to new car dealers.
Used car dealers offered independent financing solutions to outperform the automotive sector during the downturn. While new car dealers rely on financing companies to fund consumers' purchases, used car dealers often offer in-house financing known as buy here, pay here (BHPH). Traditionally, customers who purchase vehicles on a BHPH basis have C- and D-grade credit ratings. Says Amari, “Even customers with B-grade credit had difficulty finding affordable financing during the credit crisis.” These customers purchased vehicles from used car dealers on a BHPH basis rather than opting for traditional financing from new car dealers. The Used Car Dealers industry is firmly in the mature phase of its life cycle and has a low market share concentration. With the diffuse and highly saturated nature of this market, significant changes in industry concentration are unlikely to occur. Major company CarMax's notable growth was achieved organically, with no mergers or acquisitions. So any major increases in industry concentration are most likely to occur within CarMax or another used car dealer adopting similar business practices.
Mossy Toyota sold a used car that shakes, rattles, and rolls. San Diego consumer Jon Perz says the dealership refused to take it back ,and told ...
What do auto dealers use to value used cars?
Aug 27, 2008 by Pete F | Posted in Buying & Selling
I've heard of a "Black Book" of pre-owned car values used by dealerships when they buy and sell used vehicles (kind of like the industry version of the Kelly Blue Book). If so, how can someone who isn't a dealer get a hold of one of these books?
Most dealers base the price of the vehicle on current dealer auction results. Companies like Black Book have representatives at many auctions, and they rate the condition of the vehicle and note the sales price.
Many of the auction companies also offer either weekly or monthly reports of sales prices. Manheim Auto Auctions (one of the largest auction companies in the country has a pricing program available for dealers to download, and that also can be accessed on line.
The auction reports are proprietary information, and are not available to the public. Black Book will sell you a subscription to their publications, but unless you are a dealer, you really do not need a weekly update!
Black book has a website, but you have to pay to use it! You do not have to be a dealer!
http://www.blackbookusa.com/
The NADA book is not the Black Book. The NADA book is yellow, and is only updated monthly
fire4511 | Aug 27, 2008
The car dealers use a variety of tools to assess the value of a trade-in. One tool is the "black book" published by the North American Dealers Association. This provides an approximate value for many used vehicles.
Dealers have a used car manager that researches prices paid for similar cars at local auctions. The car dealer will often auction trade-ins if they require too much reconditioning or spend too much time on the used car lot (more than two weeks). The cars represent capital tied up in inventory, so turn around is important.
Sometimes, dealers have a list of vehicles that prospective customers wish to purchase, this adds to the base amount that a dealer might otherwise pay.
Finally, I have heard a dealer call another dealer in the area to ask what he thinks the car is worth, especially if the trade-in is a brand that the other dealer sells as new.
If you don't think one dealer is giving you a fair price, go to another. I have experienced a spread of as much as 10% difference between the low cash trade in and the high cash trade in offered for the same car on the same day.
gearhead4 | Aug 27, 2008
those blue books and similar are pretty much worthless if you have something that is in the least bit unusual, different, or over a few years old. The best way to judge the value of a vehicle is to price similar vehicles on craigslist.org, your local paper, and autotrader.com to get an average price for what vehicles go for in your area. They vary throughout the country, which is just one reason why the "blue-books" are worthless.
jd | Aug 27, 2008
How many new and used auto dealers are there in the US?
Oct 20, 2008 by brent.scott1 | Posted in Buying & Selling
I am trying to find out how many new and used car dealers there are in the US.
Plenty. Finding a car to buy here is no problem at all. Getting a good deal is another matter.
bastard | Oct 20, 2008
There are so many car dealers who are selling new car and used cars in US.It is not possible to count how they exactly.There every one has a car.The government of USA used to seize the cars every day from illegal activists.So there might be a plenty of used car dealers.
Sweety | Oct 20, 2008
Does anyone know any used auto dealers that have that 3 day money back guarantee in Ontario?
Feb 29, 2008 by toomuchtoomuch | Posted in Buying & Selling
I'm looking for a used car, but don't trust very many dealers. I understand that some dealers have an x-day money back guarantee, does anyone know of any in Ontario (maybe around Toronto)?
Thanks in advance
Rather than looking for a three day guarantee, which would have terms and limits, you may want to rethink your approach. A day return policy will usually just allow you to return the car, and have the purchase price applied to another vehicle (not refunded). The thing the dealer will not tell you is if you bring the car back, he will NOT negotiate one cent on the replacement car. You will have to pay list price of keep the first car.
A better approach is to pick out a car you like, and take the car, at your own expense, to a qualified mechanic of your choosing. You are paying the mechanic, so he will be looking out for you. Any dealer that will not allow you to take a car to your mechanic, during the day, at your own expense, locally, should not get your business.
Don't forget to have a vehicle history report run also.
fire4511 | Mar 01, 2008
Is it manditory that all Used Auto Dealers produce the buyer a Carfax?
Feb 17, 2010 by ClarenceP | Posted in Buying & Selling
Do auto dealers use Trans Union or Experian credit score to lease/finance a car?
Apr 03, 2009 by vgolish | Posted in Buying & Selling
I know that auto dealers use a specific credit score to lease/finance a car, but I forgot which one. I believe it is either Trans Union or Experian. I know that auto dealers use one score even if this score is the lowest of all. Does any one know which credit score, Trans Union or Experian, auto dealers use to lease/finance a car? Thanks.
they probably pull all three Trans union, experian, and Equafax.
The Cash for Clunkers program - which was supposed to help boost new auto sales - is actually crushing sales at used car dealerships nationwide. and more »
Meanwhile, Esterakis of John's Auto Sales says used-car dealers like him are not getting rich off of the higher prices. "We're not doing great. and more »
Fewer new car sales means fewer late-model trade-ins, the mainstay of auto dealers. Rental car agencies are hanging on to their cars longer as well. and more »
Since the early 1950s, Huntington has provided new and used automobile financing and dealer services business, as well as other comprehensive banking and more »
Ursomarso said there's been a consolidation in the local auto dealer industry, with the number of "dealer principals" down but each principal owning more and more »
Fewer new car sales means fewer late-model trade-ins, the mainstay of auto dealers. Rental car agencies are hanging on to their cars longer as well. and more »
