Complete collapse of the used car market?

[c1pher]

Originally Posted by chassis

I'm seeing some asking price slippage, but not for P-cars.

Same, Porsche prices seem to be hanging on. I’m not sure if it was because they were the only growing car brand before all this happened and feel they can stick it out or the wealthy just aren’t impacted by all this and sales are great for them. I don’t see that since many cars I track have sat in inventory several months.

[DarkstarZero]

New update:

We now know why off-the-lot used car values haven't dropped much while auction prices have.
https://nypost.com/2020/06/05/used-c...utos-languish/

"More than 4 million off-lease vehicles are due to return to the market this year, at a rate of around 340,000 per month.

Automakers and their finance arms are trying to slow the pace at which those vehicles hit auctions to avoid flooding the market.

KAR Auction Services has bought 200 acres of land and is seeking another 100 acres to store cars for major customers.

Tom Kontos, chief economist at KAR, which alongside Manheim dominates the US used-car auction market, calls these vehicles “melting ice cubes.” They lose value every day, and cannot be held back for long."

Other reports show that they're now storing cars in stadium parking lots, since those aren't going to be used any time soon.



They're trying to control supply to reduce the flood of cars into the market which artificially keeps off-the-lot prices high. This helps out big used car dealers like CarMax who need to sell their cars for more than they paid for, before the flood happens, otherwise they would go bankrupt as each vehicle would then become a liability if the value on all of them fell below the price they paid.

However, this is basically like a dam holding back a rising river. Eventually they're going to have to open the flood gates before the dam breaks. All things considered, it still seems like around September is when the implosion will occur.

[chassis]

Smart on behalf of the industry participants (auctions and dealers). Not surprising. The headline doesn’t herald anything in my view.

There likely will be no floodwaters that need held back at the rate jobs are being restored in the US economy. Local Mercedes dealer told me business was good in May. Local tire shop that just opened told me business was much better than they had forecast and hoped for.

[thormessiah]

I think used car market will remain steady but the brand new car sales will take a hit. The dealers in our city are offering 0% APR to anyone with average credit scores and some serious discounts to go with the purchase of a new vehicle. I had a friend that traded in her almost brand new Camry to upgrade to the new 2020 & got over $6k in discounts along with no APR. Also those overpriced Supras they got sitting on their lot? All reduced along with no APR. I’m pretty sure you could negotiate further as well

[Alfisti]

What's APR?

[BeEmVe]

Originally Posted by Alfisti

What's APR?

Annual percentage rate (APR) refers to the annual rate of interest charged to borrowers and paid to investors

[BeastieBombRacing]

Originally Posted by thormessiah

I think used car market will remain steady but the brand new car sales will take a hit. The dealers in our city are offering 0% APR to anyone with average credit scores and some serious discounts to go with the purchase of a new vehicle. I had a friend that traded in her almost brand new Camry to upgrade to the new 2020 & got over $6k in discounts along with no APR. Also those overpriced Supras they got sitting on their lot? All reduced along with no APR. I’m pretty sure you could negotiate further as well

When I got my FRS, they gave us 0% APR so we got all of the available TRD parts installed at delivery.

I'm not sure whats available for the Supra, but sounds like you could do that and still be under MSRP with these price cuts. Not a bad deal.

[chassis]

New lower price levels are being established in my search window for the oldest models and less desirable colors. Nothing I would jump on, and no collapse of prices. But price slippage nonetheless.

[VChenz]

Originally Posted by chassis

New lower price levels are being established in my search window for the oldest models and less desirable colors. Nothing I would jump on, and no collapse of prices. But price slippage nonetheless.

I think the demographic who are in the market for luxury or gently used luxury cars were not as heavily impacted by the pandemic. Lots of working professionals just started working from home.

Im in Canada and I believe the US lay-off/furlough impact was similar to both of our economies, where people who earned less were hardest hit (ex. retail, manufacturing, food industry, etc.)

We have a lot of US customers (software service business) and almost everyone kept their IT staff/senior execs/etc. (some took a pay cut) but the only furloughed staff were those at the bottom of the food chain in those organizations.

It'll be interesting to see the impact on the used car market for higher dollar vehicles. Like someone stated earlier - Porsche resale is still strong/flat. The town I live has a very small Porsche dealership and I see inventory rotating off their lot/new inventory coming in throughout the pandemic.

[thegump]

The stimulus + $600 extra for unemployment has left most people with more money and time than they had while actually working.

Sales have slumped mostly from business closures and people not wanting to go out

[fastboatster]

+1 to used luxury car prices holding up well. Don't see too many moves.

[aerostar]

Originally Posted by thegump

The stimulus + $600 extra for unemployment has left most people with more money and time than they had while actually working.

Sales have slumped mostly from business closures and people not wanting to go out

Watch what happens in August after the $600 a week runs out.

I can see mass riots b/c I don't see unemployment improving much from the 13% current number.

[Mach550]

Looks like a group of people either changed their minds and lost 20-40k or couldn't afford the payments

2020 X3M Comp 3k Miles $66k

2019 750i 6k Miles $72k

2019 S560 6k Miles $80k

2019 M850i 5k Miles $82k somethings wrong with this ones hood or it wasn't latched properly and the interior seems like it was used by wolverine

[BeastieBombRacing]

I’ve seen a LOT of used BMWs with the hood askew like that. Always wondered what happened

[PYE46M3]

Originally Posted by DarkstarZero

New update:

We now know why off-the-lot used car values haven't dropped much while auction prices have.
https://nypost.com/2020/06/05/used-c...utos-languish/

"More than 4 million off-lease vehicles are due to return to the market this year, at a rate of around 340,000 per month.

Automakers and their finance arms are trying to slow the pace at which those vehicles hit auctions to avoid flooding the market.

KAR Auction Services has bought 200 acres of land and is seeking another 100 acres to store cars for major customers.

Tom Kontos, chief economist at KAR, which alongside Manheim dominates the US used-car auction market, calls these vehicles “melting ice cubes.” They lose value every day, and cannot be held back for long."

Other reports show that they're now storing cars in stadium parking lots, since those aren't going to be used any time soon.



They're trying to control supply to reduce the flood of cars into the market which artificially keeps off-the-lot prices high. This helps out big used car dealers like CarMax who need to sell their cars for more than they paid for, before the flood happens, otherwise they would go bankrupt as each vehicle would then become a liability if the value on all of them fell below the price they paid.

However, this is basically like a dam holding back a rising river. Eventually they're going to have to open the flood gates before the dam breaks. All things considered, it still seems like around September is when the implosion will occur.

so a lot of nice cars getting tons of bird poop cooked into the clear coat under the summer heat. how many CF roof BMWs will be in the mix and go down the drain?

[chassis]

Originally Posted by Mach550

2019 M850i 5k Miles $82k somethings wrong with this ones hood or it wasn't latched properly and the interior seems like it was used by wolverine

This happens when the hood isn't slammed evenly. It happens on my wife's G01 X3 when I don't use two hands and firmly slam the hood shut.

[Flacht3]

Originally Posted by DarkstarZero

Would love it if they had to pull out one of those middle cars for some reason. Imagine being the guy who works on the lot and getting that phone call...

(I know it's not likely, but still ).

[dreamingat30fps]

Originally Posted by Mach550

Looks like a group of people either changed their minds and lost 20-40k or couldn't afford the payments

2020 X3M Comp 3k Miles $66k

2019 750i 6k Miles $72k

2019 S560 6k Miles $80k

2019 M850i 5k Miles $82k somethings wrong with this ones hood or it wasn't latched properly and the interior seems like it was used by wolverine

When did a used X3 get up to $66k??? How much is a new X3???

[VChenz]

Originally Posted by dreamingat30fps

When did a used X3 get up to $66k??? How much is a new X3???

X3M... Not a regular X3

[Alfisti]

A regular X3 is well over 60K here. YOu can option it to past 70K

[dreamingat30fps]

Originally Posted by VChenz

X3M... Not a regular X3

Theres an X3M???

Oh BMW you cray cray!

[chassis]

Good news for sellers, not so much for bargain hunters such as myself.

Wholesale Prices Continue Strong Performance First Half of June
https://publish.manheim.com/en/servi...lue-index.html