Top Headlines We Are Reading At Foundation
- November 2023 New Vehicle Sales Estimates from JD Power
New Vehicle Sales UP YoY and MoM
- 10.6% YoY growth Nov. 2023 (1,236,199) vs. Nov. 2022 (1,121,482)
- 2.7% MoM growth Nov. 2023 (1,236,199) vs. Oct. 2023 (1,203,758)
Inventory continues to rise, despite the UAW strike that lasted late in October- Inventory levels in November are expected to finish around 1.6 million units, a 7.5% increase from last month and 43.7% increase compared with November 2022, but still over 40% below pre-pandemic levels.
- According to inventory reports at Foundation Direct the average dealer had 154 new vehicles on lot in Nov. 2023 vs. 103 in Nov. 2022. Used has been steady at 89 in Nov. 2023 vs. 93 in Nov. 2022
Vehicle Profits falling but still 2x more that pre-covid levels!- Profit per vehicle (grosses, finance and insurance income) = $3,002. 29% lower than Nov. 2022 but 2x higher than Nov. 2019.
- Why? 21.4% of new vehicles sold above MSRP, which is down from 37.1% in November 2022.
Outlook for December- In 2022 December sales grew 16.3% MoM and 29.5% YoY. Current momentum points to another big December in 2023.
- Expect competitive incentives as dealers try to lock up sales to finish the year strong.
- Search generally sees higher competition in the auctions as dealers extend budgets for the biggest sales month of the year and Tier 1/2 spend remaining budgets.
- Q3 2023 Haig Report
- Blue Sky Value of Dealers remains elevated but declining 12% this year. This varies by franchise and geo as Al Hendrickson
Toyota recently sold for the highest price ever paid for a single franchise. - SAAR and Sales Projections Continue to Rise. New vehicle sales are forecasted to reach the highest point since 2019 at 15.3M in 2023.
- New vehicle growth profits have been on a decline every quarter in 2023 starting the year at $5,300 in Q1 with Q3 coming in at $4,582. Used is now below $2,000 at $1,781 in Q3 2023 vs. $2,045 in 2022.
- Blue Sky Value of Dealers remains elevated but declining 12% this year. This varies by franchise and geo as Al Hendrickson
- Experian Automotive Trends and State of the Automotive Finance Market Report
- Experian releases there quarterly Automotive Trends and State of the Automotive Finance Market Report in back-t0-back weeks in June recapping Q1 2023.
- Quick hits on Automotive Trends: New Vehicle Registrations in Q1 2023 were up 8.8% YoY and used vehicles were down 2.2%. An interesting piece on how avg. age of vehicle on road increased because of less new vehicle being sold NOT because of vehicles lasting longer (watch webinar for explaination). The sweet spot for automotive service opportunity continues to grow with a record 104M vehicles are in the sweet-spot for fixed ops needs (cars between 5-10 years old)
- Quick hits State of the Automotive Finance Market Report Average new vehicle loan rate is 6.8% in Q1 2023 vs. 4.1% in Q1 2022 with the average new vehicle monthly loan payment being $725 up 10% from $650 a year earlier.
- Experian releases there quarterly Automotive Trends and State of the Automotive Finance Market Report in back-t0-back weeks in June recapping Q1 2023.
- Shift Digital – 2023 DIGITAL AUTOMOTIVE SHOPPING TRENDS
- Foundation Takeaway: Website traffic was observed to be up 20% while leads are down 20% across websites Shift Digital oversees in their program. Hypothesis that this was caused by increase in inventory — less reaching out to see if vehicle are available — while traffic is up as people cross-shop dealers with more options to explore with increased inventory. Foundation has observed similar trends in dealer traffic. Recommend to scroll through the article for additional insights on website CTAs for dealers.
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