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Smoke on Cars

Cox Automotive Auto Market Report: Jan. 21

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Cox Automotive’s Auto Market Report video delivers a comprehensive analysis of the current automotive market. Chief Economist Jonathan Smoke leads our effort to translate data and trends into actionable insights. This video covers a wide range of topics, including consumer spending patterns, consumer sentiment, retail vehicle sales, financing rates, supply dynamics, pricing trends and leading indicators from Cox Automotive’s extensive data ecosystem.

Download this week’s presentation

Report Summary – Jan. 21, 2025

Key Highlights:

  • Consumer spending growth remains strong at the end of 2024 and the start of 2025, showcasing robust economic activity.
  • Retail vehicle sales show strength to start 2025, with new and used sales running above last year’s pace.
  • Average auto loan rates are up from multi-year lows in December, reflecting changes in the financial landscape.

Consumer Spending and Sentiment

Consumer spending has shown significant growth, particularly in the last weeks of 2024 and the beginning of 2025.

  • Total consumer spending experienced its two best year-over-year growth weeks at the end of 2024 and the start of 2025.
  • The Index of Consumer Sentiment increased in each of the last six months and is up 0.5% so far in January.

Retail Vehicle Sales

Retail vehicle sales have started strong in 2025, with both new and used sales showing positive trends.

  • New retail sales are running 7% above the pace of last year.
  • Used retail vehicle market transactions were flat over December but are up 10% against 2024 levels.

Auto Loan Rates

Auto loan rates have increased from their multi-year lows in December, impacting both new and used vehicle financing.

  • The average used auto loan rate is 13.91%, while the new auto loan rate is 9.22%.
  • Low-interest rate deals have declined in early January compared to the year-end push for financing assistance.

Supply Situation

The supply situation for new and used vehicles remains mixed, with new supply up and used supply trending down.

  • New inventory is up 16% compared to the same time in 2024 but remains down 20% compared to 2019.
  • Used inventory fell over the latest week, declining to over 2.1 million units and down 8% against 2024.

Used-Vehicle Prices

Used vehicle prices are showing a decline early in the new year, reflecting changes in market dynamics.

  • The average retail price for model year 2022 vehicles fell 0.4% for the most recent week.
  • Wholesale prices declined 0.6% over the same period.

Cox Automotive Leading Indicators

Leading indicators from Cox Automotive were mixed.

  • Leads: Leads are up year over year so far in January on Autotrader and Kelley Blue Book, and leads are up for the month compared to December on Autotrader.
  • Dealer Metrics: Unique leads per dealer for new and used vehicles are down year over year so far in January on websites hosted by Dealer.com, and new and used leads are down for the month compared to December. Unique credit applications per dealer on Dealertrack were up 14% year over year last week, with the trend in applications per dealer improving week over week.
  • Service Trends: Service trends on Xtime relative to last year remained weak last week, as completed appointments were down 22% year over year.

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