Thursday, April 30, 2009
Wednesday, October 8, 2008
Wednesday, April 9, 2008
Dealers Report Higher Used Car Sales
Sourced From: AutoRemarketing, April 1, 2008
Situation
1. Recent Wachovia survey indicates 28% of dealers say used-vehicle sales "above expectations"
2. Represents significant increase from 22% in previous survey, up 6%
3. Dealers have "just enough" used-vehicle inventory: 82%, compared w/ 80% previously
4. This measurement climbed from 64% last year
5. Wachovia Capital Markets surveyed 40 dealers, GMs, sales managers from dealer network
6. Releases equity research papers 6 times / year; small sample size, representing only 16 states
Significant Points
1. Used-vehicle demand appears to be climbing; demand for new vehicles falling
2. Movement largely reflects seasonal trends
3. Automakers pushed new-vehicle sales in Nov and Dec
Lenders Add Restrictions for Auto Loans
Sourced From: Wall Street Journal, April 2, 2008
Situation
1. Even as Fed cuts interest rates, getting tough for buyers to find attractive terms on auto loans
2. GMAC tightened lending standards 3 times in 2007
3. AmeriCredit and Sovereign Bancorp have recently raised minimum credit score
4. In 2008, 90% of auto-loan applications from prime borrowers approved, down from 92.5%
5. Among subprime applications, 57% have been approved in 2008, down from 68% early 2007
6. Delinquencies hit 10-year high in Jan, though they declined slightly in Feb
Significant Points
1. Many lenders making fewer loans; instituting stricter standards on loans they do approve
2. Often requiring higher credit scores, making smaller loans, bigger down payments
3. Some lenders applying tough standards for borrowers in states hard hit by housing crisis
4. Subprime borrowers will bear brunt of shifting lending standards
5. Even prime borrowers w/ good credit may be affected by some changes
6. Some consumers may not be able to get a car loan at all
Says
"We're trying to lend to people who will be able to pay us back." -- Thomas Kelly, spokesman, J.P. Morgan Chase & Co.'s Chase Auto Finance
Friday, March 28, 2008
Bank survey: Franchised car dealers following customers to the used car department
A recent Wachovia Bank survey of 40 large automotive retailers shows an increase in used car sales, with 28 percent of dealerships indicating that their used car sales were above expectations, reports the Associated Press.
The results represented a steep increase from 6 percent in the bank's January survey and flat results compared with year-ago levels.
"Although there was some seasonality, we believe many dealers have lowered their expectations and new car intenders may be switching to used cars," Wachovia's Richard M. Kwas wrote in a note to investors. "In general, dealers conveyed that prospects are more interested in used vehicles over new."
In addition, 82 percent of dealers said that they have "just enough" used vehicle inventory for their needs, up from 64 percent at the same time last year.
At the same time, 15 percent of dealers said they had "too little" inventory, up from 6 percent in the last survey, but down from 31 percent last year, indicating optimism among some dealers about the spring selling season.
Officials for MyRide.com, said they've seen a steep increase over the past several months in searches for information on used cars.
According to MyRide.com, nine of the top 100 search terms entered on the Web site in September were used car-related, representing 6.2 percent of the top 100 terms' traffic volume. But by February, the most recent month available, that number had risen to 27, or about 21 percent of top 100 terms' traffic volume.
A spokesman for MyRide.com said that the specific used models drivers are searching for are the more expensive models including light trucks, such as the Ford F-150 pickup and Chevrolet Tahoe, and luxury cars like the BMW X5.
From DealersEdge Daily Headlines
March 28, 2008