A Word to the Wise

August 12, 2011

For a long time I’ve been advising dealers to avoid speculation when making stocking level decisions.  Rather, I’ve been saying that you should buy vehicles and sell vehicles in the current market.  The recent market events over the past week should serve as powerful reminders that market volatility is the new norm rather than the exception.  

While I can’t say with certainty what long-term effects will result from the recent market volatility, I can’t help but be reminded that past performance is no guarantee of future results.  I think that this reminder is particularly timely, not only in light of the recent market turmoil, but also in light of the fact that we are now seeing wholesale values slip as they generally do during the second half of the year.  I will, therefore, renew my recommendation to be strong sellers and careful buyers.