How fares the used vehicle market for franchised and independent new car dealers this year? According to DesRosiers Automotive Consultants (DAC), the market outperformed the new vehicle market in 2020, but the first half of that year was nevertheless difficult for the used vehicle dealer community. In 2021, the recovery was more apparent. 

DAC partnered with the Used Car Dealers Association on a survey aimed at better understanding the impact that the pandemic and the supply-side microchip issue had on the used vehicle market. Nearly 500 UCDA members, including independent used vehicle dealers, and used vehicle operations of franchised new vehicle dealers, were included in the survey regarding the first half of 2021.

“Respondents indicated that average sales in their stores fell from 102.7 units in the first half of 2019 to 86.5 units in 2020,” said DAC. “However, this average sales figure bounced back to nearly the same pre-pandemic levels—102.4 units on average—in the first half of this year.”

DAC also said sales surpassed 2019 volumes for new car dealers, while independent used car dealers experienced a smaller recovery—“a dynamic directly related to access to vehicles in a market where demand often exceeds supply.”

They said ongoing supply issues for new and used vehicle dealers were a topic of “particular concern” during the first six months of 2021, with dealers noting “extreme difficulties” in sourcing pickup trucks and SUVs. In comparison, passenger cars were easier to source, but there were still challenges. And younger vehicles of one-to-three and four-to-seven years old were more difficult to source than older vehicles.

Based on the survey, only 6.2% of dealers. experienced overall price decreases for their used vehicles, with the largest category (38.3%) noting average price increases of 11-20. On the other end, 18.2% of respondents experienced price increases of more than 20%. 

“The sentiments of used vehicle dealers paint a clear trend for the first half of this year,” said Andrew King, Managing Partner of DAC. “Although sales volumes bounced back, limited supply led to clear increases in the prices of used vehicles as demand spiked and vehicles continued to flow south across the border.”

 

 

 

How does the used vehicle market fare? Canadian auto dealer. (2021, September 24). Retrieved September 29, 2021, from https://canadianautodealer.ca/2021/09/how-does-the-used-vehicle-market-fare/.

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