December 2012

CNW Forecasts Strongest Used-Car Year Since 2007

BANDON, Ore.  - 

When 2012 full-year used-vehicle sales are tallied, the sum is expected to be a five-year high, according to CNW Research.

The firm’s Retail Automotive Summary released Friday afternoon said the industry’s final used sales count will likely reach 40.53 million units, which would be a 4.5-percent year-over-year hike.

What’s more, this would be the best yearly total since 2007, when 41.42 million used cars were sold. It would also end a four-year streak of used sales coming in under 40 million each year.

Franchised dealers are projected to have moved about 15 million used units in 2012 for an 8.3-percent  year-over-year gain, with independents up 1.8 percent with 14.02 million used sales. CNW is forecasting full-year private-party sales to hit 11.52 million, a 3-percent rise.

As for December’s expected results, CNW is calling for 3.15 million used sales this month, which would be on par (up 0.3 percent) with December 2011 figures.

However, this sum includes private-party sales, which are forecasted to fall 28.1 percent year-over-year at 860,030 units. Dealers, though, appear to have fared much better.

Franchised stores are expected to bring in 1.15 million used sales (up 17.3 percent from December 2011), and independents are projected to move 1.14 million units for an 18.2-percent gain.

In the analysis, CNW president Art Spinella addressed why private-party sales will fail to hit the 900,000 mark after reaching 1.2 million sales in December 2011.

“Major reason: Solid trade-in values from dealers and a growing number of those who are undecided about buying new or used falling onto the new-car side,” Spinella said.

“Outlook for 2013? Expect private-party sales to remain soft with franchised dealers grabbing a larger overall share over total used sales — perhaps as much as 40 percent, depending on the strength of the new-car market.” also released expectations for December sales. Read our story on that analysis here.

Edmunds Forecasts Landing Spot for Dec. Used Sales


As we approach the holidays, it seems used-car shoppers may have been more focused on Christmas gifts than vehicle shopping. is estimating December’s used-car sales will amount to 2.71 million, for a seasonally adjusted annualized rate of 29.6 million.

This is compared to 2.77 million, or a SAAR of 38.7 million, used-car sales in November.

Moving along to highlight new-car sales, the site forecasts that 1,361,899 new cars and trucks will be sold in the U.S. in December for an SAAR of 15.4 million light vehicles.

“This would bring total 2012 sales to 14.5 million light vehicles, which would be a 13.5 percent increase over 2012, and the highest annual total since 2007,” officials added.

These numbers would translate to a 19.1 percent increase from November 2012, and a 9.6 percent increase year-over-year.

“Retail SAAR will come in at 13.0 million vehicles in December, with fleet transactions accounting for 15.6 percent of total sales,” officials predicted.

Adding some commentary, Edmunds senior analyst Jessica Caldwell said: “December will be the icing on the cake for 2012 — it’s a strong close for a year that had significant auto sales growth throughout.

“Along with the momentum of the improving economy, December car sales have been helped by compelling advertising, generous deals from most automakers, and the rush of demand unexpectedly and unfortunately caused by Hurricane Sandy,” she continued.

Breaking the numbers down by manufacturer, predicts General Motors to lead the way with 237,799 sales this month.

The Blue Oval is expected to follow closely behind with 212,898 sales, with Toyota coming in at No. 3 with 201,502 sales.

Chrysler Group and Honda round out the top five with 148,085 and 133,621 sales, respectively, according to’s predictions.

Happy Holidays from Auto Remarketing

CARY, N.C.  - 

Auto Remarketing and Cherokee Automotive Group would like to wish all our readers a healthy holiday season and a happy New Year.  

This issue of Auto Remarketing Today will be the final edition of 2012 before we take a holiday break. Thank you for your interest and support this year, and we look forward to a great 2013.

Stay tuned for our upcoming print editions of Auto Remarketing to kick off the year. The Auto Remarketing e-newsletters will return on Jan. 2.

CarMax Q3 Sales, Revenue and Earnings All Jump by at Least 10 Percent


Pick a financial statement metric — net sales and operating revenues, net earnings, used unit sales, finance arm income — and CarMax posted a double-digit jump year-over-year during the third quarter of its current fiscal year.

The company said Thursday that its third-quarter net earnings grew 15 percent to $94.7 million or $0.41 per diluted share, compared with $82.1 million or $0.36 per diluted share, in the third quarter of previous fiscal year.

CarMax highlighted that its used-vehicle sales volume improved significantly with total used units climbing 16 percent and comparable store used units up 12 percent.

“The comparable store used unit growth was driven by improved conversion, which we believe benefited from a variety of factors; including more compelling credit offers from third-party finance providers and CarMax Auto Finance, increased inventory selection, improved customer sentiment and continued strong in-store execution,” officials said.

The company added that the used-vehicle average selling price was similar to the prior year’s quarter.

Meanwhile, CarMax enjoyed wholesale vehicle unit sales improvement, too, as volume grew 10 percent compared with last year’s quarter. Officials indicated wholesale unit sales benefited from an increase in appraisal traffic, while the appraisal buy rate was similar to the prior year’s quarter.

The company mentioned other sales and revenues increased 5 percent compared with the prior year’s third quarter as an increase in extended service plan (ESP) revenues was largely offset by a reduction in net third-party finance fees.

CarMax noted third-party subprime providers, who purchase subprime financings at a discount, originated 14 percent of used-vehicle unit sales in the recent quarter compared with 9 percent in the prior year quarter. ESP revenues climbed 22 percent due to both the growth in used-vehicle sales and an increase in ESP penetration.

All told, the company calculated total gross profit increased 14 percent to $345.2 million from $303.2 million in the third quarter of the previous fiscal year, primarily reflecting the increased used and wholesale vehicle unit sales as well as higher other gross profit.

Looking specifically at CarMax Auto Finance, the division’s income increased 16 percent to $72.5 million compared with $62.6 million in last year’s third quarter.

The growth in CAF income was largely attributable to the 15-percent increase in average managed receivables, which grew to $5.48 billion from $4.77 billion in the prior-year period.

“The increase in average managed receivables reflected the rise in CAF origination volume throughout fiscal 2012 and fiscal 2013 as we transitioned back to our pre-recession origination strategy, higher average amounts financed and the growth in retail unit sales,” officials said.

After reviewing the company’s entire quarterly performance, president and chief executive officer Tom Folliard said, “We are pleased to report strong increases in used and wholesale vehicle unit sales and CAF income, which drove solid bottom-line earnings growth. Our strong comparable store sales growth allowed us to leverage SG&A expenses, even as we expanded our store base.”

RVI: November Sees Rise in Used Prices, But Increase May Not Last

STAMFORD, Conn. - 

November was a big month for the U.S., with the Northeast recovering from Hurricane Sandy and President Barack Obama being elected for a second term. And although there is still uncertainty for the future, the economy continues to move upward — right along with used-car prices, according to data from RVI Group.

In the company’s latest Risk Outlook report, RVI said used-car prices saw a monthly increase of 2 percent in November, and are up 4.4 percent year-over-year (for two- to five-year-old vehicles on a seasonally adjusted basis).

Real used-car prices (after adjusting for MSRP) showed an increase of 1.9 percent from October and are up 2.2 percent from last November, officials added.

One segment, in particular, has outperformed the market average over the past 12 months, RVI noted.

Used luxury small sedan prices have soared, but are expected to decrease from current levels in 2013.

“Competition in the segment is expected to begin increasing in 2016, showing little change until then. Used-vehicle supply will decline through 2015 and then increase through 2017,” the report reads.

And the overall trend of rising used prices is connected to increasingly tight inventory in the lanes, according to RVI.

“Our auction supply index declined in November and shows a 19.5-percent decline so far in 2012 (on an annual basis), which correlates with an increase in used-car prices in 2012 when compared to 2011,” officials said.

But dealers shouldn’t expect this price trend to continue into the new year and beyond, RVI officials warn.

“Used-car prices will face downward pressures through 2017. In 2013, new-car competition is expected to increase (i.e. more vehicles will have less total market share amongst their segments) although used-car supply will remain low,” RVI said.  “Beginning in 2014, used-car prices will soften due to lower new car prices, higher incentives, and increasing used-vehicle supply.”

SAAR Continues to Increase

Moving along to the new-car market, RVI said that new-vehicle sales increased in November to a 15.5 million SAAR.

This past month, new-vehicle sales increased by 14.5 percent year-over-year, and increased 8.7 percent from October.

This spike could be a direct result of increased demand for new vehicles in the wake of Hurricane Sandy, officials explained.

As for new-car prices, these rose by 1 percent year-over-year, but fell 0.1 percent when compared to the prior month.

The company also noted that many of the predictions in its report are dependent on the current U.S. economic situation.

“We would like to keep in mind that while our forecasts are based on relatively stable conditions in the future, the outcome of the Fiscal Cliff situation in the US could have much bearing on the near and long term future of the US and global economy,” RVI officials concluded.


GM Recalling Nearly 119K Midsize Trucks


The National Highway Traffic Safety Administration said General Motors is recalling 118,800 midsize trucks because the hood of these units may be missing the secondary latch.

The models included in the campaign are the 2010 through 2012 Chevrolet Colorado and GMC Canyon trucks manufactured from Nov. 9, 2009, through Aug. 28.

If the primary hood latch is not engaged, NHTSA indicated the hood could open unexpectedly. During vehicle operation, officials said this condition could obstruct the view of the driver and increase the risk of a crash.

The agency noted GM will notify owners and instruct them to inspect their vehicle for the presence of a secondary hood latch. Franchised dealers will replace the hood on any affected vehicles, free of charge. The recall is expected to begin on Jan. 17.

In the meantime, owners may contact Chevrolet at (800) 630-2438 or GMC at (866) 996-9463 and reference campaign No. 12319.