Economic Downturn Means Upswing In Used Car Sales
We reported earlier that the smart money is getting out of OEMs and into parts and used sales. Business Week confirms that while new car sales are tanking, used car sales are on the rise. A Wachovia survey of 40 vehicle retailers shows an increase in used car sales; 28 percent of dealerships indicated that their used car sales were above expectations. Dealers are also reporting greater inventory pressure for used cars, along with greater than expected demand for pre-owned vehicles. Online research companies are also showing significant increases in searches for information about used cars. "Although there was some seasonality, we believe many dealers have lowered their expectations and new car intenders maybe switching to used cars," says Wachovia’s Richard M. Kwas in a letter which accompanied the report. "In general, dealers conveyed that prospects are more interested in used vehicles over new." Good news for some, bad news for others.