February 2, 2015
ON THE WEB: Dealers Put High Value On Theft Recovery
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Remarketing Responds to Higher Volumes
A study released by Inilex found that dealers consider GPS-based theft-recovery devices one of the highest-value aftermarket products.
CarMax Inc. Readies For Expansion
CarMax Inc. is hiring for more than 75 positions for the company’s new store in Turnersville, N.J. This is the company’s first store in the state.
Auto Finance Reaches All Time High
Equifax announced that the total balance of auto loans in December was $975 billion, representing 33.2 percent of total outstanding non-mortgage consumer debt. The total is an all-time high.
Study Ranks States by Financial Risk
A study ranked Maine as the least risky state financially for drivers, while Florida ranked as the riskiest due to differences in insurance requirements.
Rush - Dated Material
Photo by Ted Craig NOT THE SAME: Manheim chief economist Tom Webb shares his view of the used-car market during a press conference at the National Automobile Dealers Association convention. Webb said he was optimistic about the coming year. By Ted Craig
SAN FRANCISCO – The used-car industry is preparing for a spike in off-lease returns last seen around the turn of the century. But that doesn’t mean the market will follow the same downward path.
“If the industry had the same remarketing practices as it did in 2002, I’d be worried,” said Manheim chief economist Tom Webb. “They do not, so I am not.” Webb said the main difference this time is manufacturers, who have an interest in maintaining residual val-
ues, are leasing the cars. Jonathan Banks, executive automotive analyst for the NADA Used Car Guide, said this is the first time since the recession that the volume of 0-8-year-old cars will rise. Of course, one person’s deluge is another’s end of
a drought. Steve Jordan, executive vice president of the National Independent Automobile Dealers Association, said his members need more vehicles at lower prices. “A lot of our members are excited about the increase in off-lease returns,” he said.
Supreme Court Considers Case with Finance Implications By Ted Craig
A Supreme Court decision on fair housing could have a big effect on auto finance regulation. The court heard the case, Texas Department of Housing and Community Affairs v. The Inclusive Communities Project Inc., on Jan. 21. If the court decides in favor of Texas, it would limit claims of disparate impact, at least in regard to housing. Disparate impact, which claims racial bias without direct intent, has been the basis for the Consumer Financial Pro-
tection Bureau’s argument against dealer participation in auto finance. CFPB Director Richard Cordray has said the court’s decision on this case won’t affect his agency’s push for finance companies to switch to flat fees. Bill Hempler, executive vice president of the American Financial Services Association, said the case is at least likely to slow the CFPB until the decision is announced. That could come as soon as June. A panel of lawyers at AFSA said press reports guessing at how the Justices will decide on the case were premature.
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