Used Car Shortage Looming for the Next 5 Years

The Expert Podcast

Overview:

• A hidden crisis is looming in the automotive retailing industry, stemming from the pandemic's impact, which continues to affect the market even years later.

Key Points:

• Fewer Lease Returns:
  • The pandemic resulted in lower sales and lease volumes in 2020 and 2021 when dealerships were shut down.
  • In 2024, there will be fewer lease returns because many leases originated during a period of low vehicle sales.
• Impact on Used Car Inventory:
  • Used car inventory is primarily sourced from vehicles sold two or three years prior.
  • The most common lease term is three years, so vehicles leased in 2021 are not returning to the market in expected volumes.
• Market Trends:
  • The late-model used car market is anticipated to be slim for the next 12 to 18 months, potentially leading to higher prices for used cars.
  • Owners who purchased cars in 2021 are likely to keep them longer, further reducing the availability of late-model used cars.

Future Outlook:

• According to JD Power, used vehicle supply is not expected to return to 2023 levels until the end of the decade (approximately 5-6 years away).
• Consumers should consider keeping their current vehicles longer or looking into new car options, as the price difference may be negligible.

Advice for Listeners:

• With high interest rates continuing, it's essential to plan ahead if vehicle replacement is needed in your family.
• Explore your options and consider how the market may change over the next few years.

Additional Resources:

• For personalized guidance, check out actualhuman.com for live one-on-one private video consultations with experts on this topic.

Conclusion:

• If you found this information helpful, explore more videos on our channel for additional insights to assist you in navigating your automotive needs.