Chief Economist Jonathan Smoke explains
CPO likely to break another record, but growth slows
Thursday January 25, 2018
Article Highlights
- Cox Automotive economists are expecting approximately 2.7 million certified pre-owned vehicle sales in 2018, and if that comes to fruition, it will be the eighth straight year of record CPO sales.
- “On the CPO side, it’s interesting … the simple math is that 2017 eked out a slight gain,” Cox Automotive chief economist Jonathan Smoke said in a conference call with media and analysts this month.
- “Technically, the CPO numbers set a record for 2017. But it was a less than 1-percent gain over 2016,” he said. “So we’ve started to see a real deceleration in CPO volumes, and when you drill into it, you basically start to see that we’re no longer seeing substantial growth in non-luxury CPO, and that’s really what had been driving a lot of growth in recent years.”
Cox Automotive economists are expecting approximately 2.7 million certified pre-owned vehicle sales in 2018, and if that comes to fruition, it will be the eighth straight year of record CPO sales.
But the acceleration in certified sales is not what it has been in prior years amid what is a slowdown in growth on the non-luxury side of the market, they say.
According to Autodata Corp., there was an estimated 2,645,718 CPO vehicles sold in 2017, compared to 2,642,986 sold in 2016. That’s a gain of just 0.1 percent.
Comparatively, certified sales climbed 3.5 percent in 2016, after jumping more than 9 percent in 2015, according to Autodata.
Sales were up 10.8 percent in 2014.
“On the CPO side, it’s interesting … the simple math is that 2017 eked out a slight gain,” Cox Automotive chief economist Jonathan Smoke said in a conference call with media and analysts this month.
“Technically, the CPO numbers set a record for 2017. But it was a less than 1-percent gain over 2016,” he said. “So we’ve started to see a real deceleration in CPO volumes, and when you drill into it, you basically start to see that we’re no longer seeing substantial growth in non-luxury CPO, and that’s really what had been driving a lot of growth in recent years.”