Unique market conditions due to the coronavirus (COVID-19) pandemic could be driving more consumers out of the new market and into used vehicles, according to the car shopping experts at Edmunds. Edmunds analysts note that June used vehicle finance figures and Edmunds website data indicate shifts in shopping behavior that are not usual for the used vehicle market and could point to more typical new car shoppers entering the fray.

Edmunds data shows that interest rates for used vehicles dropped to the lowest level since January 2018, with the average annual percentage rate (APR) falling to 7.8 percent in June, compared to 8.3 percent in May and 8.6 percent a year ago. The average used down payment climbed to $3,167 in June, surpassing $3,000 for the first time that Edmunds has on record dating back to 2007. Edmunds data also reveals that 26.3 percent of used vehicle sales with a trade-in had negative equity in June, the lowest level so far in 2020.

Seventy-six percent of people who bought a new car looked at a used car along the way
Cross-shopping used vehicles online has skyrocketed during the pandemic

According to Edmunds website data, more new shoppers are cross-shopping used vehicles than before COVID-19. Twenty-nine percent of new vehicle shoppers between mid-May and mid-June also considered used, compared to 24 percent between mid-January and early March.

“More consumers are looking for value in their next car purchase due to the economic challenges of the coronavirus pandemic, so the more favorable loan conditions we’re seeing are likely a direct result of more consumers with good credit shifting into the used market,” said Jessica Caldwell, Edmunds’ executive director of insights.

Subaru of America, Inc. reported 53,911 vehicle sales for June 2020, a 12 percent decrease compared with record June 2019. These results reflect the impact of the COVID-19 global pandemic and the uncertainty surrounding economic recovery. Following eleven consecutive years of sales records, Subaru reported year-to-date sales of 267,110, a 21 percent decrease compared to the same period in 2019.

“Our June results are a testament to the perseverance of our retailers, who overcame difficult circumstances to achieve our sales target,” said Thomas J. Doll, President and CEO, Subaru of America, Inc. “We place a high premium on the satisfaction of our owners resulting in loyalty to our retailer’s franchise and our brand. These June results demonstrate the proven value our products provide, best delivered through our trusted retailers.”

“We are pleased to close June with strong sales in the midst of a competitive market limited by the pandemic,” said Jeff Walters, Senior Vice President of Sales. “The Forester continued to shine in our lineup of all-star vehicles, drawing a healthy demand from car buyers looking for vehicles they can rely on when times are tough.”

 

Sales Figures for Subaru for June 2020

 Carline

  Jun-20

  Jun-19

  Percent Chg

  Jun-20

  Jun-19

  Percent Chg

 

 MTD

  MTD

 MTD

 YTD

 YTD

 YTD

 Forester

 19,490

 14,753

 32.1 percent

 85,860

 86,219

 -0.4 percent

 Impreza

 3,389

 5,558

 -39.0 percent

 18,620

 29,688

 -37.3 percent

 WRX/STI

 2,170

 1,864

 16.4 percent

 10,333

 12,374

 -16.5 percent

 Ascent

 6,079

 7,014

 -13.3 percent

 31,397

 40,108

 -21.7 percent

 Legacy

 2,054

 3,222

- 36.3 percent

 11,901

 17,426

 -31.7 percent

 Outback

 10,250

 17,505

 -41.5 percent

 62,305

 93,711

 - 33.5 percent

 BRZ

 238

 203

 17.2 percent

 962

 1,540

 -37.5 percent

 Crosstrek

10,241

 11,392

 -10.1 percent

 45,732

 58,459

 -21.8 percent

 TOTAL

 53,911

 61,511

 -12.4 percent

 267,110

 339,525

 - 21.3 percent

Asbury Automotive Group, Inc. entered into a definitive agreement to acquire certain assets of Park Place Dealerships, one of the country’s largest and most prominent luxury dealer groups for $685 million of goodwill and approximately $50 million for parts, fixed assets, and leaseholds, excluding vehicle inventory.

“We have seen our new and used volume sequentially improve each week in May and June with higher profit per vehicle,” said David Hult, Asbury’s president and chief executive officer. “We have also seen our Parts and Service business improve in June as the economy gradually opens-up. Strong May and June performance, along with cost restructuring efforts, have driven higher profitability and cash flow, giving us conviction to move forward with a revised Park Place acquisition.

“In March, we had to step away from the transaction due to lack of visibility around COVID-19, but after seeing the rebound off the April low, we can proceed with a more refined deal under more flexible and favorable terms. Park Place is highly regarded as one of the best and most efficient operators of luxury stores in the industry.” 

Actor, producer and businessman Mark Wahlberg is growing his automotive dealership footprint with the acquisition of two more Columbus dealerships with his business partner, veteran automotive dealer Jay Feldman. The new dealerships will be called Mark Wahlberg Buick GMC and Mark Wahlberg Airstream & RV. In July 2018, the duo opened Mark Wahlberg Chevrolet at 3900 Broad Street in Columbus. 

Mark Wahlberg Chevrolet in Columbus, OH.
Mark Wahlberg Chevrolet in Columbus, OH.

The dealerships were formerly Haydocy Buick GMC and Haydocy Airstream & RV and are located right across the street from Mark Wahlberg Chevrolet at 3895 Broad Street. The Buick GMC dealership has been family-owned and operated by the Haydocys since 1954. In addition to being business partners in the three dealerships, Jay and Mark have been friends for several years and are partners in several Wahlburgers restaurants.

“Columbus has been so welcoming and it just made sense to grow our automotive platform here,”  said Wahlberg. “The Haydocy family has been wonderful to work with during this transition and Jay and I are looking forward to doing big things here on the West Side.”

The three dealerships add to Wahlberg’s portfolio of business interests that includes a movie production company, a health and wellness company, a water line and a Wahlburgers restaurant chain that is currently franchised throughout the United States, Canada and Europe.

“The Wahlberg brand is so well respected,” said Feldman. “We are anxious to do even more things in the near future together in the Columbus area. Stay tuned.” 

Manheim began adding 12 sites to its list of in-lane bidding pilot sites starting July 6.

Digital Block sales offer in-lane bidding at Manheim physical auctions with a live auctioneer and Simulcast. The vehicle never physically moves across the block during the auction process; it is only displayed on-screen. As the safety of Manheim’s team members and clients remain the company’s top priority, in-lane bidding pilots could be postponed if rising pandemic levels occur.

“As we continue to move forward with our re-opening plans, we saw great success with our return to in-lane bidding at our five initial pilot sites,” said Alan Lang, Manheim’s division vice president. “After two weeks of safety reviews, we are now ready to expand to 12 additional locations. For all pilot sites, we established strict safety protocols, including requiring facial coverings, social distancing and a daily review of pandemic data in each market.”

Sites added the week of July 6 include: Manheim Utah, Manheim San Antonio, Manheim Denver, Manheim Nevada, Manheim Cincinnati, Manheim Cleveland, Manheim New Orleans, Manheim Lafayette, Manheim Albany, Manheim Poplar Bluff, Manheim Little Rock and Rome Auto Auction, GA (digital sale operated using Manheim technology and staff).

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