February 16, 2015
ON THE WEB: Increased Inventory Speeds Depreciation
Vehicle depreciation is expected to accelerate in 2015 as increased used-car supply and larger off-lease volumes place pressure on retention rates, according to the latest joint vehicle depreciation report from Black Book and Fitch Ratings Inc.
Finance Company Faces More Legal Scrutiny
A law firm is investigating potential claims on behalf of investors of Consumer Portfolio Services Inc. concerning possible violations of federal securities laws.
Carfax Calls Unfixed Recalls a Danger
New research from Carfax suggests that millions of people may be driving, buying or selling potentially dangerous cars due to an unfixed recall.
Auction Re-Opens
Southeastern Auto Auction of Savannah held its grand reopening & $10,000 cash giveaway sale Jan. 21.
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AAA Offers Vehicles for Sale at Own Store By Sheila McGrath
AAA has been around for almost as long as automobiles. For more than 100 years, the affiliation of motor clubs has built a reputation around a variety of services related to cars, from insurance to roadside assistance to travel planning. But it wasn’t until recently that the clubs ventured into selling cars themselves. Last November, AAA Mid-Atlantic, which serves Delaware, Maryland, Washington D.C. and parts of Virginia, Pennsylvania and New Jersey, opened a AAA Select PreOwned Auto Dealership near the Philadelphia International Airport. “This is a good opportunity for us to try something new with our members and complete the circle,” said Keith McIntyre, manager of car buying for AAA Mid-Atlantic. “It makes perfect sense with what we do – it’s a nice fit, when you think of all the business lines we have.” The auto sales program is aimed primarily at AAA members, who receive
FRONTLINE: Cars fill the lot at AAA Select Pre-Owned Auto Dealership near the Philadelphia
International Airport. The store is owned by AAA Mid-Atlantic.
special benefits not available to the general public. But anyone is welcome to shop on the lot. McIntyre said the program gives AAA MidAtlantic an opportunity to provide its members a trusted, no-haggle-pricing source for vehicles. AAA can then offer the buyers financing and insurance, and members can make
payments on their AAA credit cards. “You don’t have to be a member, but the way we’ve structured it, it’s tailored to our membership,” McIntyre said. McIntyre said they plan to keep between 75 and 100 cars on the lot, with prices ranging from $13,000 up into the $30,000 range. All vehicles for sale have
fewer than 75,000 miles and are no more than six years old. Cars are given a 240-point inspection at a AAA Care facility prior to sale, and the cars come with several warranties. Auto auctions and a strategic relationship with the Hertz Corporation provide some of the inventory. However, many of their Continued on page 12
NADA Forecasts Records for Lease Originations, Volumes NADA Used Car Guide analysts predict that the number of consumer leases in 2015 should pass 1999’s record high of 3.3 million vehicles. The number of vehicles turned in after their lease ends is equally staggering: 2.35 million. That figure is a 20 percent increase over last year and points to how the used vehicle market is affected by the number of new vehicle leases. “This year is going to be a significant one as we forecast late model used vehicle supply to grow by 8 percent,” said Jonathan Banks, executive analyst for NADA Used Car Guide.
“he number of personal lease registrations has grown by about 18 percent per year since 2011, and it is that trend which helps drive the used market’s supply levels.” Among the many different vehicle types available for purchase in the used vehicle market this year, compact utility vehicles are expected to be the most highly represented segment, due to their recent popularity. Used luxury sport utility vehicles – like the Audi Q7 – are also forecasted to be easier to come by, with a 32 percent increase in availability versus 2014. Supply of mainstream used SUVs – such as the Ford Explorer and Chevrolet Tahoe– are also forecasted to grow by about 13 percent over last year.
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