CNW Research’s latest used-vehicle supply findings concur with several other assertions from wholesale analysts — it’s not going to be easy for managers to keep their used inventories stocked.

Even with trade-ins climbing because of greater new-vehicle sales, CNW revealed on Tuesday that the industry remains at a 45-days’ supply of used vehicles.

Highlighting just how significant the supply dearth is, president Art Spinella noted that January is running at a 44.3 days’ supply, lower than any month of 2011. For comparison, the level stood at 50.7 days in January of last year.

CNW recollected that having a 70 to 80 days’ supply in the early 2000s was not uncommon. In fact, used supply hit 86 days’ in November of ’08.

“Dealers continue to struggle finding the right vehicles for their inventory,” Spinella acknowledged.

“It was once thought that having a 45 days’ supply was ‘ideal,’ but that figure is now considered far too low for most dealerships. The likely ideal level is in the low 50 days,” he explained.

CNW determined that small-car supply — just like on the new-vehicle side — continued to shrink as a share of total sales while full-size pickup inventories rose to its highest level of the year in December.

“Estimated sales for January shows small cars again declining to about 16 percent of sales while pickups should take more than 13 percent,” Spinella projected.

Early January Sales Trends

Looking at how used sales are shaping so far this month, CNW indicated that private-party sales continue to increase as a share of total sales, running more than 26 percent ahead of January of last year.

Spinella pointed out that franchised dealer used sales are up about 4 percent in the opening half of the month while independent dealers saw a near 3-percent decline.

As demand increases, CNW said dealers are beginning to see prices firming.

“For example, franchised dealers’ average used-car asking price in January is about $11,516, and they are getting more than 94 percent of that asking price for vehicles bringing average transaction price to $10,855, up 2.9 percent versus year ago,” Spinella highlighted.

“It also is a gain of nearly 3 percent versus December 2011,” he added.

“If the rest of this month reflects historic first-half of January trends, the industry will sell in the 2.17 million unit neighborhood this month, or 8.2 percent ahead of last year’s 2.01 million,” Spinella went on to estimate.

In terms of age, CNW noted the hot products are still the one- to six-year-old rides, but the supply is tight.

Older models — more than 10 years old — are lagging somewhat based on CNW’s monthly segment tracking surveys.

“There is a return of younger consumers to the used-car market which should perk up the over-10 year old sales numbers in the coming months,” Spinella surmised.

“Pickups are gaining in market share while small cars are diminishing,” he continued. “This could change if gasoline prices rise dramatically, but for many of the 20-somethings, a move to anything newer than what they currently drive will improve fuel economy and offset all but massive fuel price increases.

Based on how January is unfolding, CNW noted that dealers should expect sales for the year to settle into the high-30 million or even 40 million units.

Primary Drivers’ Median Age Tells a Tale

Also contained with its latest report, CNW delved into a discussion about the connection between the age of the driver and what brand that buyer chooses.

“It’s not uncommon to read about the average or median age of buyers for a particular model, but that often skews the results of who, actually, drives the car,” Spinella explained.

“Lexus commercials during the Christmas season are a case in point: Buy a Lexus as a present for a spouse or lucky teenage child,” he continued.

“So, in many cases, seeing the median age of the actual primary driver of a vehicle can tell a lot about the ability of a manufacturer to reach an older or younger audience,” Spinella added.

With that explanation in mind, CNW determined that for the industry as a whole, the age of primary drivers of vehicles acquired in 2011 was up nearly 5 percent to 50.8 years compared to 48.4 years back in 2005.

“Much of that is a reflection of the recession cutting many consumers out of the new-car market.” Spinella pointed out.

Overall, CNW found that Ford has seen a 10-percent decline in the average age of its primary drivers since 2005, from 58.4 years to 52.5 years.

“Much of that is a reflection of a strong message to younger consumers with Fiesta and high use of social media,” Spinella surmised.

At 55.4 years, CNW determined the typical General Motors primary driver is about 6.5 percent older than he or she was in 2005.

“Blame the lack of Saturn and Pontiac for the rise. Among the brands still in the stable, most have seen a decline in median age,” Spinella said.

As CNW has pointed out in the past, Toyota and Honda buyers and drivers have been getting older for a decade or more.

“Some of this can be attributed to younger consumers not wanting to own ‘my father’s Camry or Accord’ and part is some less than inspiring mainstream models,” Spinella indicated.

CNW found Toyota median age is now up to 51 years — older than Chrysler and approaching Ford.

Honda is up to 53.5, compared to 47.6 in 2005 and a full year older than Ford buyers.

By moving upscale with its product line, CNW mentioned Hyundai has seen the age of primary drivers climb 12.6 percent — “on purpose,” according to Spinella.

Now at 42.4 years, “it remains among the youngest brands, but is now in the demographic sweet spot,” he added.