In good sign for service departments, age of vehicle population hits all-time high
In recent years, several automakers have expanded the age eligibility limits for vehicles in their respective certified pre-owned programs.
And although there’s room for improvement, dealers are improving the customer experience in the service department.
Both are good signs, given what S&P Global Mobility discovered about the average age of vehicles on the road.
At 12.6 years, the average age of vehicles in the U.S. in 2024 is at an all-time high, the company said Wednesday.
What’s more, the population of vehicles in the 6- to 14-year-old age group — which S&P Global Mobility called the “sweet spot” for vehicle service — is expected to climb, while numbers for vehicles newer than 6 years old have slowed.
“With average age growth, more vehicles are entering the prime range for aftermarket service, typically from 6 to 14 years of age,” said Todd Campau, aftermarket practice lead at S&P Global Mobility, in a news release.
“With more than 110 million vehicles in that sweet spot — reflecting nearly 38 percent of the fleet on the road— we expect continued growth in the volume of vehicles in that age range to rise to an estimated 40 percent through 2028,” Campau said.
In January, there were 286 million vehicles in operation in the U.S, versus 284 million a year ago.
Less than 90 million of those 286 million are younger than 6 years old, S&P Global Mobility said. It will likely be 2028 before that age group hits that mark again, the company said.
That’s quite a change from pre-COVID times, when there were 98 million vehicles less than 6 years old in the U.S. vehicle population in 2019.
But those “historically high volumes” of younger vehicles have gone in reverse thanks to the COVID-induced supply chain impacts, the company said.
S&P Global Mobility anticipates that for the next five years, about 70% of the vehicle population will be at least 6 years old.
The aging vehicle fleet was also evident in trade-in data from Edmunds.
“How do we know that consumers have made a return en masse? Look no further than an increase in average trade-in ages,” Edmunds director of insights Ivan Drury said in an analysis last week.
“In 2022, new-car inventory constraints forced many would-be buyers with prospective older trade-in vehicles to sit out the market and even had some traditional new-car buyers resorting to used. But as 2024 resembles a more familiar market, trade-ins of older vehicles have begun to return,” he continued.
“In Q1 2024, the average trade-in age for new vehicles climbed to 6.1 years compared to 5.3 years in Q1 2022. The average trade-in age for used vehicles increased to 9.4 years in Q1 2024, compared to 7.9 years in Q1 2022,” Drury said.
Older vehicles have seen growth in the auto auction lanes, as well.
While sales of 1-3-year-old vehicles last month climbed 15% from April 2023, all age bands climbed double-digit percentages year-over-year, according to AuctionNet data from the National Auto Auction Association.
The scope of that growth included a 17% year-over-year gain for vehicles 11 years and older down to an 11% hike for 4-6-year-old vehicles.