Working once again with our friends and colleagues at the Used Car Dealers Association, DesRosiers Automotive Consultants reached out to the used car dealer community. Close to 500 UCDA members responded to our survey with both independent dealers and the used vehicle arms of franchised new vehicle dealers offering their perspectives on the used vehicle market in the first half of the year.

According to the surveyed members, the first half of 2022 presented both challenges and opportunities for the used vehicle market. “The used vehicle market has been hugely disrupted by the various impacts of new vehicle shortages” commented Andrew King, Managing Partner of DAC. He continued, “For the first half of 2022, sales decreased as sourcing became even more difficult, and prices remained at stratospheric levels.”

According to dealers, used vehicle sales have—on average—fallen in the first half of 2022 when compared to the first half of 2021. While used vehicle dealers have seen a minor increase in average sales, up from 65 to 67 units sold, new vehicle dealers have seen their used vehicle sales drop from 165 to 148 units on average.
When asked what sales volumes they expect throughout 2022, used vehicle dealers cited an average of 146 units with new vehicle dealers expecting used sales at 286 units on average. When asked this question in our previous survey in January 2022, used vehicle dealers expected sales to reach 214 units on average with new vehicle dealers expecting 313. Overall, combined sales expectation dropped from 256 to 189 units.
One of the persistent issues impacting both the new and used vehicle markets has been vehicle supply, with new vehicle shortages leading to large shortages in used vehicles as well. When asked about the change in their supply situations, the majority of both new and used vehicle dealers cited a worsening situation, at roughly sixty percent of responses. A further 30.7% of both dealer types noted no change from the already difficult situation in 2021, with just 9.9% citing an improvement.
As soon as demand shifted from the new vehicle market to the used, prices began to shoot up for used vehicles. When asked how prices shifted for particular used vehicle types in the first half of 2022, results largely pointed towards increases. For passenger cars, a combined 78.0% of responses pointed towards price increases with just 5.0% noting price drops and 17.1% noting no change. For the comparatively more popular SUVs, results were similar with 76.4% of responses pointing towards price increases. For both passenger cars and SUVs, the largest portion or responses pointed towards increases of between 11 and 20 percent. For pickup trucks, 68.3% of responses pointed towards price increases—spread somewhat more evenly in terms of percentage—with 18.6% of responses noting no change and 13.0% citing a decrease in price for the first half of 2022.







Desrosiers Automotive Consultants. DesRosiers Automotive Consultants. (n.d.). Retrieved August 11, 2022, from

The wholesale market as a whole continues to slightly decline, down -0.26%, more than the 2017-2019 average, which was -0.21%, according to Canadian Black Book. The Canadian wholesale market for used cars was down -0.40%, compared to being down -0.22% last week. The truck/SUV market improved, but continued on a downhill path of -0.12% for the week, compared to the previous -0.22%, compared to the 2017-2019 average of -0.21%.

The US market exchange rate remains favourable for exportation, Arbitrage opportunities have continued to bring US buyers, causing a steady flow of vehicles south across the border. Gas prices are dipping slightly, but are still an influence on buyer behaviour, says the report. Supply remains low while demand is high on both sides of the border. Upstream channels continue to tap supply before it can be made available at physical auctions.

Only two segments of the car market made modest gains, with sub-compact cars up 0.27%, and prestige luxury cars up 0.04%. Mid-size cars were down the most, at -1.07%, with full-size cars down -1.02%.

For trucks/SUVs, there were only three slight price increases, with full size vans up just 0.45%, minivans up 0.34% and sub-compact crossovers up 0.16%. Compact vans declined the most, down a full -1.61%, followed by sub-compact luxury crossovers which were down -0.71% for the week.

The average listing price for used vehicles increased slightly week over week, as the 14-day moving average is just above $37,000. Analysis is based on approximately 120,000 vehicles listed for sale on Canadian dealer lots.

In other news, The Bank of Canada expects inflation to go “a little over” eight per cent for the month of June and stay in that range for a few more months, Governor Tiff Macklem told a business group in a webcast transcript released late Friday.

Bank of Canada increases policy interest rate by 100 basis points, continues quantitative tightening, and the Canadian dollar strengthened against the greenback on Monday, and the yield on benchmark government debt climbed. The loonie was trading 0.5% higher at C$1.2965 to the greenback, or 77.13 U.S. cents, after trading in a range of 1.2899 to 1.3029.






dealer, C. auto, Ockedahl, C., dealer, C. auto, & McAlister, Z. (2022, July 21). Used car and truck market continues gradual decline. Canadian Auto Dealer. Retrieved July 25, 2022, from

With inflation and interest rates both up sharply, and gas prices at record levels, DAC reached out to consumers to get their input about how the economic situation may impact their intention to purchase a vehicle this year. Unsurprisingly, nearly half of respondents suggested that they are less likely to take the plunge into the vehicle market given the current economic concerns. Looking across the country, consumers from the Atlantic region and Alberta were the most hesitant, citing ‘less likely’ at 57.0% and 56.9% respectively.

While consumers seem to be echoing Elon Musk and his “super bad feeling” about the economy it should be noted that current consumer actions are showing a completely different perspective. Across the wide range of economic variables tracked by DAC, consumer spending is at record levels – often well above the previous highs of 2019. OpenTable reports restaurant reservations in Canada 15% above pre-pandemic levels, RBC cardholder spending data is tracking 30% higher than 2019, Statistics Canada retail sales data jumped yet again in the most recent month. One variable after another, shows consumers are (currently at least) spending at a torrid pace.

“When it comes to the outlook for vehicle purchases, future consumer behaviour is far from clear” commented Andrew King, Managing Partner at DAC. He continued, “while such concerns are in some way moot until vehicle supply issues are resolved, they are critical for the future outlook of the industry.” As such, DAC continues to track a broad range of economic variables closely and each quarter publishes a vehicle sales forecast by segment, province, and powertrain type for the coming 5 years.












More information on these numbers can be found in the DesRosiers Automotive Reports published by DesRosiers Automotive Consultants Inc.

Copyright © 2022 DesRosiers Automotive Consultants Inc., All rights reserved.



In a report released by this week, it was revealed that auto prices are at record highs across the country. Used auto prices continued to gradually increase throughout the first part of 2022, which is “the opposite of the pricing trends observed in previous years before the pandemic. This trend is similar for new vehicle prices, which also continued to rise.”

Well-publicized inventory shortages due to global events, the pandemic, and material scarcity, which has pushed the demand for new vehicles into the used vehicle market, causing upward price pressure on both segments. Quebec’s prices are not as high as the rest of the country, but have been increasing more rapidly to catch up.

SUVs, minivans and trucks are experiencing the strongest  increases as a result of “growing consumer demand for larger vehicles, with minivan prices increasing at the fastest rate given shortages in the segment.”

According to the study, the price of used North American vehicles has been stabilizing with increased levels of used inventory. AutoTrader predicts that, as vehicle production returns to capacity, it will ‘relieve pressure from car buyers switching to used, which will have a calming effect on price inflation for both new and used vehicles.”

Anecdotal evidence suggests that the Quebec used car low inventory situation may have arisen from dealers outside the province purchasing inventory from Quebec, but the situation is slowly improving.

The top 10 most-searched vehicles over the study period were:

  1. Honda Civic
  2. Ford Mustang (up from #5)
  3. Ford F-150 (down from #2)
  4. BMW 3 Series
  5. Porsche 911 (up from #6)
  6. Toyota RAV4 (down from #3)
  7. Mercedes-Benz C-Class
  8. Chevrolet Corvette (up from #14)
  9. Mercedes-Benz E-Class (down from #8)
  10. Jeep Wrangler (up from #11)

In general, prices have increased substantially year-over-year across the board, from Alberta, with the lowest increase at 32.9%, to Quebec, with the highest, at 43 per cent.






dealer, C. auto, MacDonald, S., Phillips, T., dealer, C. auto, & McAlister, Z. (2022, June 15). Autotrader reports record high prices in Canadian Auto Market. Canadian Auto Dealer. Retrieved June 16, 2022, from

Used car prices have shot to record highs and wait times for new vehicles can now take months as chip shortages have slowed down production. All of that has Canadians rethinking their car buying plans, according to a new survey. 

The latestBNN Bloomberg RATESDOTCA survey, conducted by Leger, found that four-in-10 Canadians said they have made changes to their purchasing plans, with 13 per cent saying they were delaying their purchase as a result of high prices. The online survey of 1,538 Canadians was conducted between April 8 and 10.

The price of cars has been an issue in Canada since last year. The COVID-19 pandemic has led to a trend of more Canadiansopting to drive over taking public transit, which has increased demand and prices for vehicles. Supply chain shortages have also contributed to long wait times for new vehicles to be shipped to consumers.

The survey shows that Canadians are aware the current auto market requires making concessions. About 12 per cent of respondents said they changed or are expecting to change their choice of vehicle as a result of cost, while another nine per cent said they will change their choice because of availability. Another 25 per cent of respondents said they were planning to delay their purchase entirely due to cost or availability. 

On the other hand, according to the survey, Canadian consumers are researching the vehicles they buy extensively before getting into the driver’s seat.

Two-thirds (68 per cent) of respondents said they factor in the cost of replacing and repairing a vehicle when they buy it, and how that impacts the insurance premium they pay on the car. The make and model of a vehicle can have a large impact on your monthly insurance costs — that’s because insurers look at how expensive a car will be to fix if it gets into a collision, as well as how often certain models tend to be involved in accidents. So, if your car is favoured by young people who love to speed, you’ll be paying higher insurance premiums.

Six-in-10 (61 per cent) respondents said that they consider a vehicle’s safety record or crash rating when they purchase a car, while half of respondents said they also consider the likelihood of accidents or theft.

While the majority of respondents were well informed about how the vehicle they buy impacts their car insurance rate, two-in-10 said they were not aware that factors like the cost of repairing a vehicle and its likelihood of getting stolen affected their insurance rate. 









Shmuel, J. (2022, April 29). Canadians increasing budget or delaying car purchases amid high prices: Survey – BNN Bloomberg. BNN. Retrieved May 2, 2022, from

The pandemic has been a global event with unprecedented impact on our industry. We learned that in these times, our customers demand convenience, efficiency, and speed in the buying process. Online transactions have become an expected part of the purchasing experience. Through it all, dealers have embraced digital tools to create a smooth car buying experience. 

The latest studies showed that nearly all the car buyers in the market start their research online, regardless of how they ultimately complete their purchase.

Fewer and fewer respondents completed each subsequent phase of the research process online. After submitting a lead form, the shopper either continues the process online or moves in-store.

The results showed that even though some purchasers end up buying online, the majority of them visited the store to complete their transaction. 


Did you complete your entire vehicle purchase online? 

How you can apply this your dealership:


Online research is one of the most important parts of the car buying process. A potential buyer needs to find the right vehicle, calculate payment estimates, and even start the credit application which is an important phase while they’re shopping for cars. There’s a higher chance to complete the sale when the applicants submit an application rather than just visiting your website or calling you for further information without filling out your online application.

This only can happen if you provide them with the right amount of information and convenience as they’re engaging with your website or your online inventory.


During the “research” phase, when consumers find a car on your website that they’re interested in, calculate payment estimates, and a credit application can play an important role until they finalize their purchase with you– whether online or in-store.



“11.63% of respondents said they completed their last vehicle purchase online. This subset of customers was asked again if they visited the dealership for any reason at all, and 77.59% still had to visit the dealership for one reason or another. Meaning of the total survey respondents, a mere 2.56% purchased 100% online. When asked about their online purchase experience, their satisfaction level was above average, with a score of 7.97 on a 10-point scale. 39% said convenience was the driving factor.”


The good news is consumers are willing to pay more for their vehicle if the dealership offers the following portions of the deal online:

As the studies show, the customer needs to be able to structure their deal on your website. 

Therefore, Ontario Underwriters are introducing an exciting new product to help you sell cars. We are offering our dealer partners an opportunity to add a link from their website (on other online presences such as Facebook, Kijiji, etc.)to a customized credit application. To Learn more about the product:






REYNOLDS&REYNOLDS. (n.d.). Car buying unfolded. Retrieved April 21, 2022, from 


Time to raise the red flag about what’s coming up, and how to manage the inevitable.

As a general principle, the non-prime market did somewhat well over the course of the pandemic, due to government aid.

The help consumers received during the COVID-19 crisis led to increased purchases for vehicles and even power sports. There was an increase in value for many reasons, and the price for used vehicles actually jumped about one per cent month-over-month—for power sports as well.

With government aid, many consumers were able to save more and spend more on things like more expensive vehicles. Some of these consumers are subprime, and specifically subprime consumers buying vehicles that are more expensive today.

The problem with this, that will inevitably present itself before us in the near future, is that consumers that buy into these more expensive vehicles will have a much higher negative equity when they want to resell or repurchase a new vehicle and trade-in that vehicle.

What Is Equity in a Car? How to Trade it | CASH 1 Blog - News

The problem we have today is not related to consumers getting approved at credit, because the credit approval and the default rates have been great. There is no issue with the markets as it is today.

But every lender knows that what is coming soon are rising (general) inflation rates—and higher interest rates mean consumers that are in non-prime will be the first to be impacted due to having purchased a vehicle over market value.

The whole non-prime market will see this potential issue coming fairly soon, where people will want to get out of those very expensive payments. And when they return those vehicles to a store or to try to sell them, they will be losing quite a lot, because their interest rates are higher and the vehicle price is higher. Therefore, their negative equity will be much higher.

This is a problem we are creating right now—that we created as of around last November, December, and into January. These consumers are buying high with high interest rates, and we are creating an impact that—in a few months from now, or years, or maybe a year or two—will have a lot of people buying vehicles with huge negative equities.

So for now, dealers are happy to sell vehicles during what may otherwise be a difficult period, with the vehicle inventory issue and other pandemic-related challenges. The problem is that we are shoveling negative equities, and we are not going to see such a nice scenario in a few months from now.

There is something coming—there is a wave coming, or it is already here. And what I can say is that I’m certain about that.

If you become more selective on prime,  then the non-prime segment will just grow by itself.

There will be more non-prime in the coming months and years because the interest rates will be higher. Therefore, consumers will be stuck with payments and it will be complicated and challenging for dealers that are not decoding non-prime, to cater to that segment. And the reason being is that the files will get more complex.

Dealers in the market will be choosing their consumers much more wisely, because they will not be able to afford issues with clients delaying payments since their interest rate will be high. They will become more narrow in terms of the actual prime consumers they want, which will raise the non-prime segment.

That’s the effect. If you become more selective on prime, then the non-prime segment will just grow by itself. There will be more non-prime consumers in the future, and with higher negative equities.

The challenge with that is that dealers need to secure the right inventory and the right employees to deal with the more complicated files that will result from this situation.

It’s not a simple prime approval—it will require expertise. Some dealers have that expertise, but I expect artificial intelligence technology to become a key or important player in this overall situation.

These types of tools, like predictive AI, are being adopted by some dealers to help with loan-matching and customer credit management, so that more consumers are approved, and dealers don’t leave money on the table.

And this year, dealers must investigate and implement this new technology, as well as prepare their non-prime processes for the coming months. Unprepared dealers will struggle with non-prime, they will pay a high price for experienced non-prime business managers, and their sales volumes will suffer as a result.





dealer, C. auto, & Hobbs, A.-M. (2022, February 22). Decoding the subprime lending market for 2022. Canadian Auto Dealer. Retrieved April 11, 2022, from

In the car industry we can be mystified when we see good finance applications are rejected. People just move on to the next deal and don’t give it much thought while they could make the deal work . 

If a finance manager can understand why certain deals get rejected at first, it can help dealers find some hidden opportunities for rejected applications.

Automatic rejections from a lender are often accepted as: “Consumer does not fit the lender criteria.”, without more information. Sending the application from one lender to another until the finance manager closes the file, only hurts the applicant’s credit.

Lenders see a different credit bureau than the finance managers and have their own internal scoring system. A finance manager will rarely know the actual internal score of a customer with that lender.

Understanding Your Credit Report & Credit Score - Approved Equity

Lenders might decline a file that is not structured based on that lender’s specific criteria. The decision made by the lender is 90 percent based on the data that the finance manager puts in their system. It is very important for dealers to have a deep understanding of credit in order to figure out if their clients will be declined or approved prior to submitting. 

Dealers have to be aware that when you send a finance application, approximately 2 out of every 3 deals are decided automatically regardless of an approval or decline. These transactions may never be seen by a person. 

For example, there was an applicant who applied for a car loan while under bankruptcy. On the credit bureau you could see a vehicle repossession happened nine months after the bankruptcy, but in fact it was included in the bankruptcy. The lender’s system was  triggered to decline the application, however it was only bad timing and not another issue on the credit file.

Ontario Underwriters are confident that we can provide your customers the best finance option for their situation. Our licensed financial agents will consider each lender’s financing requirements when working on each deal. We know how to navigate your finance deals and help you to make the most out of each deal. 

A Hyundai car dealership is shown in Bowmanville, Ont., on Jan. 22, 2022. Around the world, automakers are still struggling with a global chip shortage that has hobbled the industry for much of the past year. Doug Ives/The Canadian Press

Canadians hoping to buy a new or used vehicle in 2022 are in for the same kind of rough ride that 2021 turned out to be.

Continuing supply chain snarls and pent-up buyer demand mean consumers should brace for shortages, staggering price tags and months-long wait times for new orders, industry experts said.

In the new car market, buyers will likely find a dearth of both vehicles and financial incentives on the dealership floor, said David Adams, president of Global Automakers of Canada.

The chances consumers will walk onto a dealer’s lot and find what they’re looking for are slim. Instead, according to Mr. Adams, more and more consumers will have to place an order for the vehicle they want and wait weeks or months for it to arrive.

And with demand outstripping supply, deals will be hard to come by, he cautioned. As of January, Canadians were paying around $44,000 on average for a new vehicle, according to figures from J.D. Power.

Buying a preowned vehicle won’t spare Canadians from sticker shock either. As of mid-February, the average used-car price in Canada was $34,594, up an astonishing 47 per cent compared with the same period in 2021, according to figures provided by Canadian Black Book (CBB).

Normally, cars lose between 20 per cent and 30 per cent of their value in the first year. But with new-vehicle shortages diverting demand to the used-car market, one-year-old vehicles are now often selling for roughly the price of new ones, said Daniel Ross, senior automotive analyst at CBB. He expects that trend to continue into the spring and summer.

Frustrated consumers can blame a lasting mismatch between supply and demand for their woes, according to Shawn DuBravac, chief economist at IPC, an electronics manufacturing trade association.

Around the world, automakers are still struggling with a global chip shortage that has hobbled the industry for much of the past year. Semi-conductors, an essential component of electronic devices, are also a mandatory input for a number of new vehicles’ features, from infotainment modules to fuel management systems to backup cameras.

The shortage traces its origins to the onset of the pandemic in the spring of 2020, when automakers around the world abruptly cut down production – and their semi-conductors orders – in response to what turned out to be a sharp but short-lived drop in demand for new vehicles.

When car sales bounced back and vehicle manufacturers rushed to increase orders from parts suppliers, they found they’d slipped to the back of the line for chip producers, which were also facing soaring demand for products such as laptops and servers from households and businesses adapting to remote work and schooling, Mr. DuBravac said.

While chip makers are producing at full throttle and new manufacturing capacity is coming online, persistently strong global demand for durable goods, many of which require semi-conductors, means the industry will likely take until late 2022 or early 2023 to catch up with the backlog, he said.

And chips are just one of the supply chain bottlenecks facing auto manufacturers, with the cross-border trade delays linked to Canada’s trucker convoy protests adding another disruption to an already strained logistics network.

Rising interest rates, which would make it more expensive for Canadians to finance their auto purchases, are unlikely to have much of a dampening effect on demand this year, Mr. Adams said. That’s because many consumers will be able to trade in their used vehicle for unusually high values, softening the financial impact of higher borrowing costs, he said.

For car buyers with a limited budget, the only options may be shopping for less popular models, such as large sedans, or older vehicles, according to Mr. Ross.

By Erica Alini, The Global and Mail

Even though the Emergencies Act invoked by Canadian Prime Minister Justin Trudeau halted the various border protests by truckers, some people in the Canadian automotive industry believe it will impact the relationship between Canada and the U.S. as trade partners.

David Adams, President of the Global Automakers of Canada, said beyond just the initial financial losses the Canadian automotive industry suffered, due to the inability of goods to cross the U.S.-Canadian borders, there is also the damage it may have caused in the business partnership between the two countries.

“The whole premise of investing in Canada is you have access to the United States, which is the largest market,” said Adams in an interview with Canadian auto dealer, adding the border impasse “probably caused significant damage internationally” for Canada. 

Moreover, he wondered if the protests were part of a concerted effort to make it look like Canada is an untrustworthy trading partner.

In an interview with the Globe and Mail, Automotive Parts Manufacturers’ Association President Flavio Volpe said the border disruptions have “caused potentially irreparable harm to Canada’s reputation as a reliable trading partner.”

The protests happened at a time when Canada was actively trying to stop the U.S. from passing controversial legislation by U.S. President Joe Biden that would provide financial incentives to build electric vehicles in America—something that could cripple the Canadian auto industry. 

Though the bill failed to pass by one vote in December, the Canadian auto sector is concerned it could pass if it is tweaked.

Jeanine Lassaline-Berglund, President of Automate Canada and the Canadian Association of Mold Makers, said regardless of why the protests happened, it is one of the many things that has been piled on the manufacturing community to deal with as a result of on-going legislation to control the pandemic. 

“When (the governments) call manufacturing an essential sector, it’s difficult to see our way through that without interruption,” said Lassaline-Berglund.

She said the protests and the fallout made it difficult on a manufacturing sector that is already feeling the impact of strained relations with their U.S. partners, customers and suppliers.

“We’re going to need to do some significant work through the manufacturing community with our government partners in building back relations with the U.S. if we want to get out of the mess we’re in,” she said.

The decision by Trudeau to step up the government’s reaction happened after various U.S. politicians publicly spoke about the need for Canada to end the dispute. Among those who voiced their opinion was Transportation Secretary Pete Buttigieg and Homeland Security adviser Liz Sherwood Randall. 

Michigan Democrat Debbie Dingell told CBC News the impasse is going to have an impact on relying on Canada for imports. “I’m going to be very blunt. It does,” she said. “We cannot let ourselves be held hostage to these kinds of situations. If this is going to become a new and regular situation, we’ve got to bring our supply chain back home. We can’t count on this bilateral relationship we have.”

Adams was critical of the length of time it took Trudeau to put legislation in place to end the protests. “The time to do this was probably a week or two ago, not three weeks into the dispute,” he said. “I think it seemed pretty clear after the first week that nobody was going to be doing anything any time soon. But if (the Emergencies Act) gets the protests sorted out, that’s a good step to take.”





dealer, C. auto, Lefko, P., Ockedahl, C., dealer, C. auto, Moskowitz, B., & Phillips, T. (2022, February 16). Auto leaders concerned protests damaged relationship with U.S. Canadian Auto Dealer. Retrieved February 16, 2022, from