The pace of growth in used-car sales is slowing, according to a very credible source: Carmax. According to the company, total pre-owned unit sales rose 8% year-over-year for the quarter, down from the +11% gain of the prior quarter. Comp-store sales rose just 2.7% in used vehicles for the automotive retailer.
Here’s a key part to the story, buried in the details: Dealers continue to face more challenges in growing — let alone preserving — their profit margins on all facets of their operations. Average prices on used vehicles (retail) rose only 2.5%, while wholesale prices increased over 3%. The continued downward price / margin pressure on pre-owned inventory is dinging the dealership on a once-reliable, long-standing area of profitability.
Read the full article here: CarMax Sees Slowing Growth in Used-Car Sales