From the monthly archives: June, 2011

We are pleased to present below all posts archived in 'June, 2011'. If you still can't find what you are looking for, try using the search box.

New vs. Used Payment

Auction prices on passenger cars this week continued to follow a gradual decline from the peak prices reached during early June.  The view from the peak has been amazing; wholesale prices on many passenger cars still hover at 25 – 30% over last year’s prices, which is great for stimulating new car sales.  Industry pundits, NADA included, are forecasting depreciation throughout the remainder of the year, but not at a rate that will significantly change the gains we have experienced year over year.  In fact, most consumers will remain with a strong equity position on their used tr ...

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Supply Impact on Price

We’ve frequently stated that lower used vehicle supply has played a critical role in keeping used vehicle prices high over the past two years.  However the supply of vehicles being wholesaled through physical auctions has experienced even sharper declines than the market as a whole, and as a result wholesale auction prices continued to reach record levels during May and into early June.  While we have likely reached a peak in used prices for a variety of reasons, NADA does not expect prices to decline dramatically which is an assumption that is supported in large part by supply da ...

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Politics & the Automotive Industry

I read a quote this week that made me start thinking about all the political banter surrounding the automotive industry.  The quote went something like this: “In retrospect the situation was very predictable...”  The context of the quote was not automotive related, but made me think of what scholars have dubbed hindsight bias, which basically explains that when one  looks at anything retrospectively it creates false confidence that  a situation was easily predictable when it occurred  even though the event was very complicated at the time.  This quote is ver ...

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May Sales could have reached 12.6M

The doom and gloom in the press was getting me down, so I decided to find some solace by searching for a silver lining among all of these dark clouds.  The used market is one; prices are high, demand is strong, and more consumers can view their automobile as an asset and not a liability.  On a more theoretical level, David Wagner, NADA’s Senior Manager of Analytics, provided some other encouraging data that helped improve my day.  The month of May's new vehicle sales were disappointing and when thrown into the cauldron of other bad news (unemployment, consumer confidence, etc. ...

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Springtime Blues

The fragile state or our economy was exposed in May with virtually all indicators showing signs of weakness.  Housing prices according to the S&P/Case-Shiller index dropped 4.2 percent during the first quarter. Consumer confidence dropped, retail sales did not live up to expectations and gasoline prices remain very high.  All these factors contributed to a cautious, if not negative situation for demand, and the new vehicle sales pace suggested some hesitation in consumers for purchasing automobiles with the SAAR tracking under 12M for the first time since September of last year.& ...

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