NADA Reveals ’09 Used-Vehicle Trends for Franchised Dealers
McLEAN, Va. — The average price that new-car dealers fetched for a used-vehicle on the retail market in 2009 dipped about 1.5 percent from the prior year, according to the NADA DATA 2010 report compiled by the National Automobile Dealers Association.
Specifically, NADA noted that average used retail price was $14,976, compared to $15,201 in 2008.
This was just one of the many findingsof the report, which covered a slew of franchise trends and provided a look at how its dealer members fared in 2009.
While pointing out that new-car sales plummeted from 13.2 million units to 10.4 million vehicles, there was some "good news" on the used-vehicle front.
"Used-car values increased as the shortage of used units started to limit sales for used vehicles," officials noted. "The demand for used cars increased more quickly than the supply increased. This shortage of used vehicles, along with other factors, contributed to higher second-half new-vehicle sales and a V-shaped recovery of manufacturing in the United States."
Looking at the used-vehicle operations at franchise dealers in more detail, the report noted that there were just under 15 million used units sold at these stores last year. This compares to the average from 1999 to 2009 of 18.89 million vehicles.
Breaking it down, retail used sales for franchised dealers were at 9.1 million units in 2009, while wholesale sales were at 5.8 million vehicles.
Where did these dealers obtain their used inventory in 2009?
According to the report, 34 percent were bought at the auction, 30 percent were trade-ins for customers buying new vehicles, and 30 percent were trade-ins for customers buying used. The "other" category comprised 11 percent of the total and 5 percent of used inventory was acquired through street purchases.
Revenue from used vehicle sales was up 3.5 percent, officials noted.
NADA: Dealers Still Vital in Communities
And while acknowledging that on an overall basis, last year was quite rocky for dealers, in general, NADA pointed out that despite the challenges, dealerships still provided a high level of employment for cities and towns throughout the U.S.
"The payroll for all new-car dealerships was nearly $44 billion, and represented about 13 percent of the nation's total retail payroll," explained Paul Taylor, NADA chief economist. "New-car and -truck dealers are significant contributors to their local economies, tax bases and civic and charitable organizations."