Laurence Dixon's Articles

May Mid-Month Used Price Update

Depreciation over the first half of May has been more or less consistent with the trends we’ve observed over the first four months of the year.

To date, prices this month of vehicles up to eight years in age have dropped by 2.7% relative to April. That figure equals NADA’s forecast for the entire month. While it’s certainly possible for prices to move even lower in the coming weeks, the fact depreciation slowed from well above 3% in the first week of the month to its current rate suggests May will close with prices near current levels.

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New Vehicle Spiffs Rise Noticeably In April

According to Autodata, automakers elected to hold the line on incentives over the first three months of the year following a two year period of steady increases. But the year’s short-lived streak was broken last month, as manufacturers increased incentive spending by 3.2% compared to last April to an average of $2,671 per unit. The month’s moderate rise placed spending year-to-date 1% higher than it was over the period last year.

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Credit Update: Times Are Good Now, But What About Tomorrow?

Credit availability and new and used vehicle sales are basically joined at the hip. After all, automaker captive finance companies were created with the mission to provide credit to consumers so more new vehicles could be bought and produced. Among many things, the Great Recession and the years since reaffirmed the lesson that as credit availability goes, so go new and used sales. Prices are also affected by access to lender cash. The incredible interest rate wave the market has been riding for the past few years combined with ever-increasing loan terms have allowed consumers to buy more richly contented vehicles with only nominal changes in monthly payments.

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From Temporary to Permanent, Car Rentals Educate on Future Purchases

From business trips to vacation or holiday travel, renting a car or truck always coincides with some sort of unique occasion, and these events offer drivers the opportunity to log valuable seat time in models that may find their way on to, or off of, auto

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Cheaper Gas Should Mark a Return to Gas Guzzlers, Right?

In almost serendipitous fashion, gasoline prices have plunged to their lowest level since 2010 just as the budget-stretching holiday season is upon us. According to AAA, the national average of a gallon of regular grade gasoline currently stands at $2.67, down nearly 30 cents from a month ago and almost a $1 from where prices were at this time last year. The tumble in price is due to a few factors (the Wall Street Journal has a nice summary). Substantial increases in Canadian and U.S. production of crude oil over the past few years and additional output from Libya and Iraq have raised t ...

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Summer Weather to See Economy Bounce Back

The U.S. economy was battered even more than first suspected by the harsh winter, actually shrinking from January through March. The result marked the first retreat in three years, but economists are confident the downturn was temporary. According to the Commerce Department, gross domestic product contracted at an annual rate of 1% in the first quarter. That was worse than the government's initial estimate last month that GDP during the period grew by a slight 0.1%. The economy last posted a decline in the first three months of 2011 when it dropped 1.3%. The  ...

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Mid-Size Car Deals Should be Especially Sweet in May

Long the preferred choice for consumers looking to strike the perfect balance between practicality and affordability, mid-size cars have fallen on tougher times as of late as new sales for the group have fallen by 11% over the first four months of the year – the most of any segment. The primary driver behind the decline in deliveries: competition from other segments. Today’s compact car is big enough to comfortably accommodate small families, has amenities comparable to its larger cousin, and comes with a price tag thousands of dollars less. The bigger problem for the segment ...

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2014 NADA – J.D. Power Automotive Forum Highlights

I’ve attended the majority of the Automotive Forums sponsored by NADA and J.D. Power held in conjunction with the New York International Auto Show over the past four years; however, the conference’s fifth showing was likely the most informative and thought-provoking thus far. Since a full day of presentations and panel discussion left too much usable content to be shared in a brief blog post, the following are condensed points and comments I found to be among the most interesting made during this year’s forum. Note that while many of these were derived from statements made ...

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GM Ignition Recall and Wholesale Auction Prices

On Feb. 10, GM announced a recall of model year 2005-2007 Chevrolet Cobalt and 2007 Pontiac G5 vehicles due to ignition switches that could inadvertently be switched off from too much weight on the key ring or jarring road conditions, factors that could cause the engine to shut off and prevent airbag deployment in the event of a crash. A series of fatalities linked to the defective ignition switch prompted GM to issue the recall and the automaker has since associated 12 fatalities to the problem. Two weeks later, GM increased the recall to include model year 2006-2007 Chevrolet HHR ...

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U.S. EIA’s Latest Report Contains Important Implications for Alt-Powered Vehicles

Recently the U.S. Energy Information Administration (EIA) released an early version of its “Annual Energy Outlook” report for 2014 (AEO2014). Each year the organization publishes a long-term energy assessment that is intended to be used “as a starting point for analysis of potential changes in U.S. energy policies, rules, or regulations or possible technology breakthroughs.” Contained within the pages of the early AEO2014 release are numerous projections that deal with the EIA’s reference case (or the most probable forecast) for energy market trends, which shou ...

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