Wolf pays attention to the car marketplace.
...Retail inventory of used vehicles at the start of October dipped to 2.15 million units, well below the 2019 range of 2.8 million to 3.0 million vehicles, and about 27% below September 2019, according to data from Cox Automotive today....
[During CoVid] ...Supply to the used vehicle market of 2-to-3-year-old vehicles comes largely from rental fleets that take units out of service, lease returns when 2 or 3-year leases mature, and regular trade-ins. But this supply pipeline was severely disrupted at the beginning of the pipeline by the new-vehicle production cuts due to the semiconductor shortages. From Q2 2021 through Q1 2023, automakers sold 6 million fewer new vehicles than over the same period before the pandemic. These 6 million units didn’t go into the pipeline toward the used vehicle market and are now not coming out at the other end.
So in terms of future retail prices, this is not a good inventory situation. Dealers will be motivated to bid up auction prices to replenish their tight inventories...
Get that cute little 3-year-old now. It won't be as easy in February.
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