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U.S. used-vehicle sales will rise in 2018

Lease returns to power used-car sales

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Article Highlights

  1. U.S. used-vehicle sales will rise in 2018 on swelling off-lease returns, while new-vehicle volume will decline modestly, forecasters say.
  2. The most challenging environment in 2018 may be for independent dealers specializing in older used vehicles, which are in relatively short supply.
  3. "In 2018, we're going to see used vehicles become more competitive with new," said Jonathan Smoke, chief economist for Cox Automotive.

U.S. used-vehicle sales will rise in 2018 on swelling off-lease returns, while new-vehicle volume will decline modestly, forecasters say.

Because dealerships typically generate bigger margins selling used vehicles than new ones, U.S. franchised dealers will be better positioned for the change than the manufacturers and suppliers of new vehicles. The most challenging environment in 2018 may be for independent dealers specializing in older used vehicles, which are in relatively short supply.

The conditions favoring used-vehicle sales — more volume coming off retail leases, falling prices and a richer mix of the crossovers and SUVs most in demand — make them more competitive against new vehicles with higher price tags.

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