Pub. 2 Issue 1

VIRGINIA AUTO DEALER www.vada.com 10 A look at the raw sales numbers for the first half of the year might be enough to discour- age almost anyone in the busi- ness of selling cars and trucks, but there are signs things are changing for the better and that means opportunity. That opportunity is knocking on the used car side of the business, but it will only pay off if managed correctly. I n a typical year, U.S. consumers buy about 17 million new vehicles and around 20 million used vehicles from dealerships. But, we’re on a roller coaster ride that has taken us from steep sales declines early in the pandemic to soaring levels of used car sales at the start of summer. One Cox Automotive analyst forecasts 14 million vehicles sold in the U.S. in 2020, down from 17 million in 2019. Sales in the sec- ond half of 2020 were significantly higher than the first, though no one expects sales to get back to normal anytime soon. We know that used vehicles commanded higher prices early this summer. One of the reasons consumers are finding sparse choices at new vehicle lots is because automakers laid on generous incentives in April, sparking a temporary spike in sales, leaving little inventory and limit- ing options. When you run low on new cars, the focus turns to used cars. Late model used vehicles — especially popular pickup trucks, SUVs and crossovers — are in high demand, but in short supply, driving up wholesale prices. Right now, wholesale prices are approaching retail prices. What’s important now is for dealers to move into the next few months very carefully in the face of rapidly changing S mart Used Car Management Can Help During Pandemic By Nick Jackson, Manager – Dealer Training, Ally Academy