Comments on: Are you prepared for what’s about to happen? http://www.dalepollak.com/2008/12/10/are-you-prepared-for-whats-about-to-happen/ Used Car Market - A Guide for Success Thu, 02 Sep 2010 17:23:00 +0000 hourly 1 http://wordpress.org/?v=3.0.1 By: Dennis Cardinale http://www.dalepollak.com/2008/12/10/are-you-prepared-for-whats-about-to-happen/comment-page-1/#comment-3061 Dennis Cardinale Thu, 18 Dec 2008 00:43:44 +0000 http://www.dalepollak.com/?p=251#comment-3061 Here in SoCal the contraction of supply (lack of trades) has created more demand for clean units, excepting the typical "program" type vehicles! As always, supply and demand are the determing factors. Here in SoCal the contraction of supply (lack of trades) has created more demand for clean units, excepting the typical “program” type vehicles!
As always, supply and demand are the determing factors.

]]> By: dpollak http://www.dalepollak.com/2008/12/10/are-you-prepared-for-whats-about-to-happen/comment-page-1/#comment-3056 dpollak Fri, 12 Dec 2008 15:05:10 +0000 http://www.dalepollak.com/?p=251#comment-3056 As further testimate to my projections, please see the below exerpt from Tom Kontos, Manheim's economist released today: Next, conversion rates have climbed moderately, but inflow at auction was heavier than outflow during the month, thus increasing inventories, Kontos stated. "As these units are released into the market over the coming months, they will continue to put downward pressure on prices," Kontos projected. As further testimate to my projections, please see the below exerpt from Tom Kontos, Manheim’s economist released today:

Next, conversion rates have climbed moderately, but inflow at auction was heavier than outflow during the month, thus increasing inventories, Kontos stated.

“As these units are released into the market over the coming months, they will continue to put downward pressure on prices,” Kontos projected.

]]> By: dpollak http://www.dalepollak.com/2008/12/10/are-you-prepared-for-whats-about-to-happen/comment-page-1/#comment-3055 dpollak Thu, 11 Dec 2008 18:13:11 +0000 http://www.dalepollak.com/?p=251#comment-3055 Dale, Just read your blog post telling dealers to prepare for a water shed fall out. Manheim Consulting has just released their November results and to no surprise November wholesale prices were totally awful. Its a good read (link below). What I found interesting (and what may be of assistance to you) is the chart at the bottom that looks at price change in each vehicle class. The Year over Year % Change numbers are: Compact Cars: 4% Midsize Cars: 11% Luxury Cars: 10% Large Pickups: 18% Large SUVs: 18% Overall: 12% Also, if any of the big 3 fail, or, if the bridge loan passes but it makes it clear that buying a big 3 vehicle is risky, it only makes sense that retail demand for the big 3 would crater and wholesale prices would fall so far as to entice brave buyers that the risk/reward ratio is worthy. Likewise, non Big 3 used units have a potential to fetch a premium. Possibly, we're seeing this "flight to quality" happening right now. Variables going forward is the impact of very low cost of Gasoline on demand. Will it support the large truck market? From my seat it looks like the potential for the largest impact will come to anything large that is from the Big 3. And, it just so happens that the Navigating these waters is as complex and volatile as anyone can ever recall. I can think of no better solution than reducing risk by reducing the total dollars invested and thinking about keeping inventory marked to market (aka "lean and mean"). Best wishes! Joe P. Dale,

Just read your blog post telling dealers to prepare for a water shed fall out. Manheim Consulting has just released their November results and to no surprise November wholesale prices were totally awful. Its a good read (link below).

What I found interesting (and what may be of assistance to you) is the chart at the bottom that looks at price change in each vehicle class.

The Year over Year % Change numbers are:
Compact Cars: 4%
Midsize Cars: 11%
Luxury Cars: 10%
Large Pickups: 18%
Large SUVs: 18%
Overall: 12%

Also, if any of the big 3 fail, or, if the bridge loan passes but it makes it clear that buying a big 3 vehicle is risky, it only makes sense that retail demand for the big 3 would crater and wholesale prices would fall so far as to entice brave buyers that the risk/reward ratio is worthy. Likewise, non Big 3 used units have a potential to fetch a premium. Possibly, we’re seeing this “flight to quality” happening right now.

Variables going forward is the impact of very low cost of Gasoline on demand. Will it support the large truck market? From my seat it looks like the potential for the largest impact will come to anything large that is from the Big 3. And, it just so happens that the

Navigating these waters is as complex and volatile as anyone can ever recall. I can think of no better solution than reducing risk by reducing the total dollars invested and thinking about keeping inventory marked to market (aka “lean and mean”).

Best wishes!

Joe P.

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