Used-car sales climb as Americans hold onto older vehicles
Prices drop slightly across the board, but dealers still have relatively limited supplies of lower-mileage models.
About 40.5 million used vehicles changed hands last year, a 4.4 percent increase from 2011, according to analyst firm CNW Research, which estimates private, retail, fleet and commercial sales of used light-duty vehicles. By the fourth week of January, sales of used cars were up 4 percent year-over-year, at about 2.3 million vehicles total.
According to AAA, the average age of all cars currently on U.S. roads is 11, up from about 9.4 years in 2009 and 8.4 years in 1995.
As usual, the top-selling used vehicles mirror most of the top-selling new vehicles. More than 1.1 million used Ford F-Series pickups were sold in 2012, marking the truck's 13th straight year leading the used market and outselling new models by nearly double, according to CNW. The Toyota Camry -- still the No. 1 selling new passenger car -- racked up more than 1 million used sales, followed by the Honda Accord (992,000), Honda Civic (809,000) and Toyota Corolla (808,000). Other popular used models included the Ford Focus, Ram pickup, Nissan Altima, Chevy Silverado and Ford Explorer, each of which sold more than 619,000.
Sales of certified pre-owned (CPO) cars by franchised dealers represented only 4.5 percent of the total used market, at about 1.8 million. CPO cars typically have an extended factory warranty and are supposed to have been inspected more closely. Americans bought more Asian brands than domestics -- 51 percent, compared with 32 percent -- with Kia, Hyundai, Mazda and Nissan posting big double-digit year-over-year gains, according to Autodata Corp. When accounting for all corporate divisions, Ford was the only domestic make to post an increase in CPO sales (32 percent), with Chrysler and General Motors dipping slightly.
A lagging supply of lower-mileage dealer trade-ins pushed prices of CPO cars upward in 2012, said Paul Taylor, chief economist for the National Automobile Dealers Association. Taylor said new-car sales should increase by 1 million in 2013 and spur an additional 600,000 used-car sales. About 60 percent of a dealer's used stock is trade-ins from buyers looking to get a new car.
"With the general shortage of cars [and] more mileage on average, then it becomes harder to find the low-mileage, near-perfect trade-ins that [dealers] need for CPO programs," Taylor told MSN Autos.
Many dealers, he said, may start offering shorter new-car leases in an attempt to get more low-mileage used cars on the lot. On average, dealers make significantly more money on used cars than new cars. In November 2012, the latest data available from NADA, used cars racked up $2,100 in profit versus $1,300 for new cars.
But buyers can stay confident throughout 2013. Used-car prices dropped in January among both franchised and independent dealers, to $10,558 and $9,158 respectively, according to CNW. While not huge, that represents a respective decline of 3 and 6 percent.
Want the best deal? No matter if you're buying from a private seller or a dealer, pay attention to resale values for specific makes and models, and look for factory incentives on CPO cars, especially from lower-selling luxury brands like Audi. Time it just right, and you might walk away with a heavier wallet.
Go figure, my car has held its value better than my house.
I believe we have a sick economy.
I would love a new Tahoe but the price on those are totally INSANE!!!
The buyer only has so much money or credit and most new cars,the taxes,the insurance and the state tag and reg fees just eat up the budget so buying a USED Car saves money on the manufacture markup and the taxes that follow this purchase.
Plus the newer cars seem to be plagued with computer issues that require a costly reboot or restore on everything from the seats,the radio and that GPS/phone/email data center thingee!
The newer cars are made to last just a few years and keep you on the endless car payment cycle
PreOwned what a sugar frosted word for a used car, end the PC murder of our english language
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