New vehicle buyers in the United States expect limited choices and high prices
The fact that consumers in the market are fully aware of market conditions is likely to energize the automotive market. Indeed, last month was a record for April vehicle sales by volume, with 1.52 million vehicles sold. Retail sales in April were particularly strong. âConsumers are clearly in buy-now mode,â Ton adds, âlikely fearing even less choice and higher prices in the coming months. The new vehicle market, like the housing market, is very competitive. for Memorial Day weekend and early summer, when popular SUVs and pickup trucks are in high demand, it will only become more competitive in the short term. ”
The Kelley Blue Book study shows that 87% of consumers agree that the problem has an impact on both domestic and imported nameplates. As the issue is industry-wide, 73% of consumers expect to face higher prices at dealerships, and almost 60% believe they will find lower incentives. Four in ten consumers are willing to pay more than the Manufacturer’s Suggested Retail Price (MSRP), and those willing to pay more than the MSRP are willing to accept a 12% premium. In April, according to Kelley Blue Book estimates, the average MSRP for a new vehicle in the United States was $ 41,950. In other words, many consumers are willing to pay $ 5,000 on the sticker price.
The realization of what has become a âseller’s marketâ has led some consumers to the sidelines. The study shows that 37% of consumers in the market now plan to postpone their purchase. Of those consumers who decide to delay, 70% will back down for three months or more. Only 23% of candidates for a new vehicle are ready to transfer their intention to purchase to a used vehicle. Fewer are willing to change segments.
At the end of April, new vehicle inventory on dealership lots across the United States was less than 2 million units, down 42% from April 2020. The Cox Automotive Industry Insights team predicts tight inventory will remain a challenge for consumers and automakers through the end of 2021.
For more information: https://www.coxautoinc.com/market-insights/eyes-wide-open-new-study-shows-car-shoppers-expect-higher-prices-low-inventory/
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SOURCE Cox Automotive