Cox Automotive has named three experienced leaders to new positions supporting its digital inventory efforts: Derek Hansen will now lead vAuto’s Stockwave and iRecon teams while Connie Suozzo and Blake Kennedy will take on new leadership roles in the Manheim Digital organization.

“With these new connections between Manheim and vAuto, clients will be able to acquire cars in a way that is linked to their retail strategies and unlock new opportunities for success,” said Paul Whitworth, senior vice president of inventory management solutions for Cox Automotive.”

Derek Hansen has been named vice president, wholesale for vAuto’s inventory management solutions, where he will focus on bringing inventory intelligence to bear in finding and facilitating connections between wholesale and retail. To accomplish this, Hansen will bridge the vehicle sourcing and reconditioning intelligence of Stockwave and iRecon with the Manheim infrastructure. Previously, Hansen led Manheim’s digital offsite platforms, including the launch of the Manheim Express app. Hansen joined the Cox Automotive team in January 2015 as senior director of strategic planning. Prior to that, he served in roles with Bain & Company, Deloitte Consulting and Intel Corp.

With Hansen’s move, Manheim Digital Vice President, Zach Hallowell, has named two new executives to his leadership team.

Connie Suozzo has been named associate vice president, open digital and offsite, where she will be responsible for the overall strategy and growth of Manheim’s dealer offsite efforts, with a strong focus on Manheim Express, Manheim.com and OVE. Suozzo joined Manheim in 2013 and has held various leadership positions. Most recently, she led Manheim Digital’s upstream client programs.

As associate vice president, private digital stores and optimizations, Blake Kennedy will lead and manage the platforms and programs across Manheim’s private store portfolio, as well as the M LOGIC suite of decisioning solutions, which include pricing, location and other optimization products. Previously, Kennedy spent five years on Manheim’s sales team, working with clients on their digital inventory management. Prior to joining Manheim, he spent 15 years with Openlane.

According to a forecast released by Cox Automotive, the annual vehicle sales pace is expected to finish near 11.4 million, up from last month’s historically low 8.6 million pace but still far below May 2019’s robust 17.4 million level, after incorporating seasonal adjustments.

New light-vehicle sales volume in May is expected to finish near 1,050,000 units, down 33 percent compared to last May but up 49 percent from last month.

According to Charlie Chesbrough, senior economist at Cox Automotive: “Recent trends suggest daily sales are showing significant gains over March and April’s collapse. Data reveals the market hit a bottom around the first of April, and since then has been making a slow but steady recovery. The opening of dealerships, and whole states, over the last few weeks is greatly contributing to the upward sales trend. The key question for the market going forward is whether these modest but steady sales gains will continue into June or does the sales recovery stagnate.”

As the industry drives into the summer selling season, a full sales recovery faces multiple headwinds. Cox reports the crisis is unique because the industry is facing a negative demand shock and a negative supply shock simultaneously. Vehicle factories have been mostly closed since late March and are only beginning to restart. That means new-vehicle inventory is at the lowest volume in more than a year. Low inventory means less choice for consumers, particularly with popular vehicles like pickup trucks and SUVs, according to Cox.

Manheim reported wholesale used vehicle prices (on a mix, mileage, and seasonally adjusted basis) decreased 11.41 percent month-over-month in April. This brought the Manheim Used Vehicle Value Index to 125.8, a 9.2 percent decrease from a year ago, and the lowest level in three years.

According to Cox Automotive estimates, total used vehicle sales volume was down 34.3 percent year-over-year in April. Cox estimates the April used SAAR to be 27.0 million, down from 39.3 million last April and down from March’s 32.0 million rate. The April used retail SAAR estimate is 14.4 million, down from 21.4 million last year and down month-over-month from March’s 17.3 million rate. 

Manheim Used Vehicle Value Index April 2020
         Manheim Used Vehicle Value Index : April 2020

 

Wholesale prices are stabilizing as the excess supply of used vehicles comes down, Cox reported. A rolling 7-day estimate of used retail days’ supply based on vAuto data, shows that used retail supply peaked at 115 days on April 8th. Normal used retail supply is about 44 days’ supply. It ended April at 53 days. Cox estimates that wholesale supply peaked at 149 days on April 9th when normal supply is 23. It was down to 65 days by month end.

Historic lows are expected in April as the full effects of COVID-19 are felt across the U.S. auto market for the entire month, according to a forecast released by Cox Automotive.

New light-vehicle sales volume is expected to finish near 620,000 units, down 53 percent compared to last April and down 37 percent compared to last month. After incorporating seasonal adjustments, the annual vehicle sales pace in April is expected to finish near 7.5 million, down significantly from last month’s 11.4 million and far below last April’s 16.5 million level, the company reported.

However, Cox Automotive Senior Economist Charlie Chesbrough said there is a silver lining.

“April is likely to be the sales bottom for the vehicle market during this crisis,” he said. “Recent sales data suggests demand is starting to recover modestly after the initial shock in March and early April. Year-over-year daily declines, while still high, are consistently showing improvement over recent weeks. Some people want to buy a vehicle or need to buy a vehicle, even in a pandemic.”

Dealership closures, which began in mid-March in many parts of the country, are now being lifted, and sales are slowly improving, Cox reported. Sales should continue to show modest improvement in May as the country gradually reopens.

It is expected that fleet activity will decline significantly in April as well.

Cox Automotive showed the damage to the economy from COVID-19 and the resulting shutdown.

In a mid-April update, Chief Economist Jonathan Smoke stated, “COVID-19 cases keep growing in the U.S., but the pace of increase slowed last week even while the rate of testing increased. Stay-at-home orders are working. The related closures will lead to a substantial economic contraction in March and the second quarter.”

Smoke wrote that jobless claims, which have totaled nearly 16.8 million in the three weeks through April 4 (and continued to grow at press time) clearly reflect the damage to the economy.

“The employment report in April will set a record for job losses and could see the unemployment rate rise to levels not seen since the Great Depression,” Smoke stated. “The rest of the year could see some recovery, but it will depend on how the pandemic plays out.”

Consumer sentiment is down and will be a big indicator of what happens going forward, according to Smoke.

The initial reading on Consumer Sentiment from the University of Michigan fell to 71 from 89.1 in March. The index has declined 29.7 percent from February, which was close to a 50 percent bigger drop than occurred in the fall of 2008.

Smoke reported, “March already saw a 38 percent year-over-year decline in new-vehicle sales and an 18 percent decline year over year in used-vehicle sales.

“Cox Automotive’s daily estimates of retail sales showed that the sales decline increased as March progressed. The decline in sales bottomed (the first week of April), as we’ve seen seven consecutive days of improvement in year-over-year declines of both new and used through…April 8.”

Page 1 of 5

Trending News

Used Sales Benefit During Pandemic

Used Sales Benefit During Pandemic

Jul 08, 2020 Rate: 5.00

Subaru Sells 53,000 in June

Subaru Sells 53,000 in June

Jul 08, 2020 Rate: 5.00

Drivers Pass on Lane-Assist

Drivers Pass on Lane-Assist

Jul 08, 2020 Rate: 5.00