The News Keeps Getting Worse for Passenger Car Buyers

Flat new vehicle sales and an industry that’s far more interested in making crossover lovers’ dreams come true add up to a poor environment for a traditional new car buyer.

We’ve already told you how high demand for a shrinking supply of off-lease sedans and hatchbacks has sent used car prices through the roof compared to just a few years ago. That erased a go-to option for many thrifty buyers. In the new car market, however, automakers’ need to boost profits in a stagnant market means incentive spending is dropping as fast as used car prices are rising.

It’s not just sedans that saw a decline in discounts last month.

Autodata figures for September, published by Automotive News, shows automakers increasingly turning off the taps. Not surprisingly, the decreased incentive spending disproportionately impacts small, cheaper vehicles that can’t soak up the discount in their generous margins.

Industry-wide, the average automaker incentive spend per vehicle in September was $3,791, a 2.7 percent drop from a year prior. Passenger cars saw the greatest statistical dip: a 7.8 percent year-over-year decrease in spending (to $3,564), and a 3.2 percent drop over the first nine months of 2018.

Light trucks, on the other hand, still enjoy a year-to-date boost in incentives, but it’s a vanishing increase. While truck discounts are up 7.5 percent YTD, they fell 0.7 percent year over year in September. Average OEM cash on the hood was $3,892 last month.

Making the situation worse for new-car shoppers are rising interest rates and a trend towards greater credit standards, meaning buyers are more at risk for falling behind their car’s rate of depreciation while trying to pay off their pricier loan. That’s assuming they’re approved for the loan.

It’s not nearly the same market it was just a few years ago. Still, while the near future looks relatively tumultuous, you wouldn’t know it from looking at recent trade-ins. August data from Edmunds shows that 31 percent of trade-ins had negative equity — the lowest share recorded this year. The average amount owing that couldn’t be covered by the car’s value was $4,938, another 2018 low point.

a version of this article first appeared on thetruthaboutcars.com

The post The News Keeps Getting Worse for Passenger Car Buyers appeared first on VWVortex.

from VWVortex https://ift.tt/2RcVk99
via IFTTT

Comments

Project SportWagen: Going Stage 2 with APR

When we last left you, the humble little SportWagen was fresh from the development process with our friends at AWE Tuning, sporting a new downpipe, exhaust and intake, allowing things to breathe a bit easier. The car sounded great, but there was no getting around the fact that our wagon was still quite, well, slow. While we realize that nothing we do to the Golf SportWagen at this point will make it a race car, we still felt compelled to do something . To put it bluntly, we had a fever, and the only cure was more power. Flash forward a few hours, and we found ourselves at Waterfest, staring down APR’s palatial spread and the numerous tuned vehicles surrounding it. Earlier in the year, APR had hinted to us that their 1.8 TSI files would be quite impressive, and based on what they were able to do with the 2.0 TSI found in the new GTI and our time in their Golf R, we knew it’d be worth the wait. So with this in mind, we lined our G...

Project Golf SportWagen- Intro

I’ve never really been one for SUVs and crossovers. The current offerings aren’t the body-on-frame, go-anywhere specialty tools I remember from my youth, and what they lack in capability, they also lack in on-road performance. The current crop isn’t terribly good at handling or being efficient, which in my opinion are major components of our ideal driving experience. So when it comes to space or utility, I usually look for something of the wagon variety- and it seems that I’m not alone. We hit quite a few shows around the east coast each summer, and we see modified Jetta SportWagens at nearly every event. Even amongst common consumers, these cars are highly sought-after. They don’t depreciate much, making even early Mk 5 2.5 versions expensive in comparison to other Jettas or Golfs of the same vintage. This year, Volkswagen launched their latest SportWagen, which is now billed as a Golf. In many ways, this latest SportWagen is the best yet and it has certai...

Volkswagen Group Records Best Ever First-Half-of-Year Sales

With 5.5 million vehicles in customer hands after the first six months of 2018, the Volkswagen Group is seeing the best performance of its history. Group deliveries increased significantly in all core regions,” said Fred Kappler, head of sales for the Group. “Our core brands recorded strong growth in the first half year.” For the year-to-date, all of Volkswagen’s brands had sales bumps. MAN, SEAT, and Skoda led the sales charge with performances 24%, 17% and 11% better than the previous year. The big sellers, too, had strong sales periods, with Volkswagen Commercial Vehicles, Audi, and Volkswagen sales rising 3.5%, 4.5% and 6.3% respectively. That last figure is particularly good new for the board, since Volkswagen alone sold more than 3 million vehicles in the first half of 2018. As Kappler stated, the numbers are equally good when you break sales down by region. Brazil and Russia were the most improved markets (22% and 20%, respectively), while strong sales in Europe and China (u...

Vorderman Volkswagen

Search This Blog