Aug. used car sales get a boost

Dealers sold more used cars in August, helped by a small but meaningful increase in affordability.

Driving the news: Used vehicle retail sales hit 1.7 million units last month, the highest level in three years, according to Cox Automotive.

• Sales rose sharply on both a monthly and yearly basis. Dealers sold 8% more preowned cars than this July and 13.6% more than in August 2023. Certified preowned sales also rose month-over-month but were weaker than last year by 3.3%.

• Despite the increase in overall sales, used vehicle days’ supply grew from July, hitting 44 days by the end of August. This suggests retailers are taking on more inventory to meet the boost in demand.

Behind the scenes: Preowned sales benefitted from a slight increase in affordability, which rose across several metrics:

• Used car values slid roughly 1% month-over-month and 10.4% year-over-year, according to the Consumer Price Index. Price declines continue to hit preowned EVs harder than other models, with the average electric car listing losing around 20% of its value compared to August 2023.

• While APRs for new vehicles were unchanged from July, used vehicle APR averages dropped slightly to 11.3%. In March, APRs were roughly 12%.

• The number of used cars priced under $15,000 rose significantly from the previous month, improving the overall inventory mix. Edmunds says that 50% of shoppers target a $15,000 price point when looking for preowned vehicles.

Bottom line: Used vehicle demand has remained resilient despite, or perhaps because of, the fact that the car market remains more hostile to consumers than before the pandemic. At the same time, dealers are leveraging lower prices to attract consumers, boosting sales but hurting profit margins. As the market continues to normalize, retailers must now play a balancing act between discounts and sales to keep their own used vehicle business afloat.

Go deeper (3 min. read): The unexpected twist in the used car market

Become an automotive insider in just 5 minutes.

Get the weekly email that delivers transparent insights into the car market.

Join 78,000 others now, it's free:

Dealerships that sell vehicles across state lines know out-of-state titling and registration can be a headache. That’s why DLRdmv created DLR50 – The nation’s fastest-growing interstate titling platform.

DLRdmv understands the impact these deals can have on your business. With DLR50, your dealership now has 24/7 portal access to calculations, pre-filled forms, checklists, inquiries, plus white glove processing and specialist support, DLR50 is a game-changer.

You can even acquire duplicate titles in all 50 states directly through the DLR50 platform!

Out-of-state deals don’t have to be complicated! Let DLR50 simplify the entire process for you and your team.

Click Here to show us how DLR50 can help your dealership today!

DLRdmv – “The Dealer’s DMV”