Widening Gap Between Certified & New Prices May Lead Shoppers to CPO Trucks
This fall season may be bringing more shoppers to the lots to purchase a certified pre-owned pick-up truck, and AutoTrader.com officials suggest now may be a good time for shoppers to consider these full-size rides.
Why?
AutoTrader explained there is a “pretty big gap between the average price of new models and CPO models” on the site, which will come as a welcome surprise to many used buyers as high late-model prices had many shoppers turning their heads towards new units the past few years.
But now, new rates for full-size trucks are on the rise.
“With demand for new full-size trucks strong, prices have followed suit. Average listing prices for new full-size trucks are up 0.7 percent since July, with the current average price in September being $41,395 on AutoTrader.com,” officials said.
On the other hand, CPO rates for these vehicles are sliding downward, making them more attractive to shoppers.
“However, prices for CPO full-size trucks are down 0.8 percent in that same time frame, with the current average listing price for a CPO version at $33,532. That 25-percent gap means that now may be a great time for shoppers in the market for a full-size truck to consider a CPO model,” AutoTrader said.
Also, besides a widening price gap, Rick Wainschel, vice president of automotive insights at AutoTrader.com, gave Auto Remarketing a few more reasons why vehicle shoppers should consider CPO.
“CPO vehicles can be great alternatives to new models, particularly when there’s a significant gap between the price of the CPO model and a new model,” said Wainschel. “CPO vehicles are typically late-model used vehicles that have been fully inspected according to strict guidelines from the manufacturer, and they come with a warranty to give shoppers added peace of mind.”
And the truck market as a whole is seeing rising interest, as well.
“Despite gas prices rising throughout the third quarter, shopper interest in new full-size trucks on AutoTrader.com showed significant year-over-year growth, indicating that other economic factors were at play,” AutoTrader officials said.
In fact, according to the October edition of the company’s Trend Engine report, shopper interest in full-size trucks showed year-over-year increases in July, August and September, “a time when prices for regular and diesel fuel rose over 40 cents per gallon.”
Breaking the numbers down, interest in full-size trucks was up 14 percent in the third quarter, compared to the same period in 2011.
“In looking at the numbers month-by-month, the biggest year-over-year spike was in July, when interest was up 25 percent,” officials said.
Moreover, August and September also showed growth year-over-year, with interest up 13 percent in August and up eight percent in September.
And AutoTrader officials are attributing the rise to a few economic factors: the continued recovery in the housing market and construction workers looking to replace their aging vehicles.
According to data from the U.S. Census Bureau and the Department of Housing and Urban Development, new building permits were up 29.5 percent in July, up 24.5 percent in August and up 11.6 percent in September year-over-year, the site shared.
And with the average age of vehicles on the road continuing to rise, now standing at 11 years, AutoTrader noted the “growing interest in full-size trucks is being fueled by the need for workers in this industry to replace their aging workhorses.”
Wainschel also offered his thoughts on the trend:
“Shoppers typically move away from larger vehicles in times of rising gas prices, particularly when those prices are above $3.75 per gallon, but that wasn't the case in the third quarter,” said Wainschel. “Seeing a big spike in interest in July and continuing to see interest well above the levels of 2011 is a solid indication that the recovery of the housing market was strong enough to overcome shoppers concerns about the price of fuel.”