You thought of the same thing :-)
Posted on 09/29/2022 5:58:32 PM PDT by MinorityRepublican
High prices and rising interest rates are putting used cars out of reach for a growing number of car shoppers.
That’s bad news for CarMax, the nation’s largest used car dealer. CarMax reported Thursday that its earnings plunged 54% as the number of cars it sold in the quarter fell 6.4% compared to a year ago.
The company blamed “vehicle affordability challenges that stem from widespread inflationary pressures, as well as climbing interest rates and low consumer confidence.”
Although higher prices lifted the company’s overall revenue, the results were well below forecasts from analysts surveyed by Refinitiv. That set off alarm bells for investors. CarMax (KMX) shares plunged more than 24% Thursday, and other car retailers’ stocks were also hammered. Shares of used car rival Carvana (CVNA) fell about 23% and AutoNation (AN), the nation’s largest new car dealer, fell 10%. Shares of many automakers, including General Motor (GM)s, Ford (F), Stellantis and Tesla (TSLA), were also lower.
Car prices have been climbing steadily for the last two years, as a shortage of parts, particularly computer chips, has limited supply in the face of strong consumer demand. Those higher prices have been a major factor in overall inflationary pressures since roughly 40% of US households buy a car each year.
The effort to curb prices has prompted the Federal Reserve to raise interest rates at an historic pace in recent months as the central bank tries to ease consumer demand and slow the economy.
(Excerpt) Read more at cnn.com ...
You thought of the same thing :-)
The dealer wanted to buy mine back.
As the push to EVs continues, people will be hoarding their old ICE cars.
Will the people at CNN please remind us again, who shut down several states, and disrupted supply chains across the country and on a larger scale, internationally?
I recently bought a 2020 low mileage Kia Sportage for its original sticker price. Because the Kia dealers were jacking up the price on new Kias by 5K to 8K.
“We’ve got a - mile - of cars!”
The $3000 beaters I was buying for my grandkids are 5000 and up right now. Not sure if that’s gonna fall back or not.
We have three used vehicles and rotate between them. The youngest is a 2014, the oldest 2006. You do what you have to do.
That Bloomberg writer says this is a good thing about recession. Your clunker is worth more, even if you don’t have a job or enough money to buy a new car.
My SIL just bought a new 2023 Kia Sportage. Mfg date was 9/23/2022. He bought it 9/27. Not much slack in the pipeline.
All started with Obama’s “Hoopties for Hybrids” and his communist cohort Van Jones.
Prices are coming down where I am and inventory is going up. Dealers are still trying to clear out cars they bought at pandemic prices but they’re not moving. Between lower sales and higher interest rates they’ll eventually have to drop prices or no cash flow.
I’ve been watching YouTube videos by Lucky Lopez on the interconnectedness of dealerships, banks, auctions, etc… very enlightening.
I’ve had my 2013 FR-S parked in my garage for two years now, only driving it to church every couple of weeks to keep the engine and seals from aging. Maybe it’s time to sell.
I’ve heard the sweet spot is $10k -$15k for people that normally may have been going for something more expensive. That is, the expensive stuff isn’t selling, but that stuff is.
Just purchased a car from CarMax on Monday. Have to hunt but can get good deals of cars coming off of lease.
Once purchased, ran over to a brand dealer and had them inspect closely. You have 30 days to return, so no rush like it was a few years ago when you only had 7 days.
While in there today to get some replacement parts scheduled to be installed, I noted they were pretty busy with both buying and selling.
I’m thinking of getting a pre-1973 car with points and plugs. I just hate changing them so often. It didn’t bother we when I was 25, but at 61, it’s not so fun.
Classic movie.
Watch out for the flood cars hitting the market.
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