CPO car sales continue sequential growth, but still trail 2021 by wide margin
Good news, bad news for certified pre-owned vehicle sales last month.
First, the plus side.
March’s 219,360 CPO sales beat February’s total by 14.3%, marking the third straight month of sequential improvement and the strongest monthly sales tally since September, according to a Cox Automotive analysis of Motor Intelligence data.
However, CPO sales last month were down close to 23.3% year-over-year.
There were 577,529 certified sales in the first quarter, the Cox analysis shows. That’s down from 696,809 CPO sales in Q1 2021.
That's a 17.1% drop.
And as Q1 concluded this year, Cox trimmed its forecast for full-year certified sales. Analysts with the company said in a late March presentation that they are now projecting 2.8 million CPO sales for 2022, down from the 3.0 million unit forecast they made earlier in the year.
Cox Automotive chief economist Jonathan Smoke said at that time the revised forecast comes, “as we expect so much competition in nearly new vehicles including from rental car companies, that like last year, in the second half of the year, the CPO market will struggle with setting a record.”
In his latest monthly analysis, KAR Global chief economist said early results for CPO sales may have been hampered by high used-car prices.
“Retail used-vehicle sales and CPO sales have started the year down compared to 2021, 2020 and 2019, as consumers may be shying away from purchasing used vehicles at such historically high prices,” Kontos said in that report.
Looking at the pre-owned market at large, Cox estimated overall used-car sales fell close to 12% year-over-year last month. The total used-car SAAR came in at 38.0 million for the month, Cox said, compared to 34.0 million in February (revised numbers) and 43.1 million in March 2021.
Specificially, Cox estimates there were 3.55 million total used-car sales in March, compared to 3.07 million in February. In March 2021, used-car sales volume was at 4.03 million units.
Similarly, TrueCar was forecasting March used-vehicle sales of 3.6 million units, a 13% year-over-year decrease and an 11% month-over-month gain.
Cox estimates that used-car sales at dealerships were down about 11% year-over-year, coming in at 1.87 million. That's up from 1.62 million in February and down from 2.11 million in March 2021.
“Limited new-vehicle inventory has slowed the gently used segment due to fewer trade-ins,” Cox Automotive senior economist Charles Chesbrough said in the analysis. “And higher prices have slowed the sales of older model-year vehicles. Sales are likely to be slightly less this spring selling season.”