Presented by:
Hey everyone,
Big news…we’re hiring for a Director of Business Development – Advertising Sales and Partnerships at Car Dealership Guy.
What we’re looking for:
5+ years in B2B media/advertising sales (auto experience = huge plus).
A closer with a strong industry network and a track record of beating revenue goals.
Someone who thrives in fast-moving, entrepreneurial environments.
Full details are live now on the CDG Job Board.
— CDG
First time reading the CDG Newsletter?
Welcome to the Market Pulse—your no-fluff cheatsheet to auto retail, built to help dealers price right, stock smart, and stay ahead.
Refinancing is shrinking the trade pool: When borrowers swap into lower-rate loans, their payments drop, but the loan stretches longer, delaying when they can trade without taking a hit.
Rate cuts have historically fueled the shift: In 2020–2022, when Fed Funds rates sat near zero, used days’ supply tightened to the 30–40 day range. If the Fed cuts again, expect refinancing demand to jump and inventory to tighten.
Lead quality is slipping: Recent refi customers are still submitting sales leads on new and used vehicles, but most are locked into their loans for months and unlikely to transact.
(Source: Bankrate / Black Book / Cox Auto / St Louis Fed / Bloomberg Collateral Research)
Rising refinance demand is tightening used vehicle supply.
And the pressure could intensify…
J.P. Morgan Global Research now expects the Federal Reserve to deliver its first rate cut in September, with three more 25 bp cuts likely to follow by early 2026.
Here’s why that matters for dealers: When rates fall, more owners choose to refinance instead of trading in.
Refinancing = swapping an old loan for a cheaper one with a longer term. Once refi’d, the payment drops, but the customer stays locked into their vehicle longer, keeping them out of the trade cycle.
And history backs it up:
CDG analysis via Joe Cecala
When Fed Funds rates sat near zero in 2020–2022, used days’ supply dipped into the 30–40 day range.
WHY THIS MATTERS:
If rate cuts trigger another refinancing wave in September, dealers will likely lose volume, especially on late-model, low-mileage trades that drive front-end gross and feed CPO programs, even as cheaper financing brings more buyers back into the market.
Lead quality is slipping thanks to the increasingly delayed trade cycles.
When rising refi demand delays trades, it distorts which buyers are actually in-market.
Why: Because buyers who refinanced in the past 90 days are essentially locked into their loans and unlikely to move, even if they’re still submitting leads.
By contrast, borrowers from late 2023 and early 2024 with 9%+ APRs (a common rate for used prime loans at the time, with market averages running even higher) are sitting on $75–$100 in monthly savings potential if they haven’t refinanced.
CDG analysis via Joe Cecala
Note: Moneyness here measures how much a borrower could save if they refinanced today vs their original loan.
WHY IT MATTERS:
Filtering out recent refis lets your BDC focus on buyers with real savings potential, but working every lead the same way can still pay off if you’ve got the staff.
Either way, the point is tracking which leads actually turn into trades and which just burn follow-up hours.
A quick word from our partner
Auto Boutique Jacksonville boosts back-end profits with Upstart Auto Finance
From April to June 2025, Auto Boutique Jacksonville funded 75 deals through Upstart Auto Finance, and those deals are delivering stronger margins.
Sales Manager David Toxey puts it simply:
“Upstart has taken half the business from some of our other lenders. Upstart gives us better rates, and most of the time, better back-end profits. We’re definitely selling more cars.”
With competitive rates, near-instant approvals for buyers with 600+ credit scores, and funding in just 2–3 hours, Upstart Auto Finance makes it easier to close profitable deals and keep customers happy.
See how Auto Boutique Jacksonville is driving higher profits with Upstart Auto Finance
Refinancing picked up after the Fed’s rate cut last December, and with J.P. Morgan now expecting another cut in September, the pace could accelerate. That means more owners locking into lower payments and longer loans, slowing trade-ins.
Michael Wood, GM at JLR Virginia Beach, is already countering the trend by finding new ways to surface trades and keep deals moving.
Here are his team’s current Dos and Don’ts…
Do: Target owners of 2–3-year-old vehicles with max trade value
Every owner in the 2–3 year window gets the same pitch from Wood’s team, built around JLR’s current loyalty rebates that run $2K–$4K.
The pitch: “Hey, your car’s worth the most money right now. I've got discounts on my new car inventory, and because of your loyalty, we can get you an additional $2,000 to $4,000 in value for your trade.”
Do: Motivate staff with spiffs that scale
To push sourcing further, Wood built a “gold pot” for KBB acquisitions. Every KBB car adds $25 to the pot, and at month’s end, the associate with the most acquisitions wins it all.
He says it’s kept the team engaged and helped close ~7% of KBB leads, above national averages.
Do: Upgrade CRM follow-ups with ChatGPT
Wood runs factory templates through ChatGPT to sharpen tone and make follow-ups stand out. Sometimes that means sounding more formal for luxury buyers, even asking Chat to “make it more British.”
His take: “Anybody that’s not using ChatGPT right now to enhance anything that requires writing is missing out,” he said.
Don’t: Bet it all at auctions
Over the last 120 days, Wood’s team has tested buying more at auction.
This usually results in “absolute home runs” that sell in 15–20 days or drag sitting past 85 days, way over his 60-day turn target.
His takeaway: Cars go to auction for a reason, whether it’s missing equipment or hidden issues. Sprinkling a few in can work, but the focus stays on KBB and service-driven trades.
”I have a responsibility to my staff to provide them with the opportunities, whether it's opportunities to sell their car or opportunities to service a car, but in the same respect, I have to be responsible to my dealer's bottom line,” Wood said.
Wood said something to me that stuck, and it applies no matter the lane.
Refi, leasing, new, used, insurance, you name it:
“We should be attempting things that we haven't tried before and understanding that we potentially will fail in those attempts, but in those failures is where the learning will happen and the growth will happen.”
That’s the job. Test. Miss. Learn. Repeat.
Trying a tactic that’s worth covering? Drop it in the poll at the bottom.
Missed yesterday’s episode of Daily Dealer Live?
Presented by:
Spisak on Acquisition Pitfalls, Adragna on Hardest Dealership Roles to Hire
Featured guests:
David Spisak, President/CEO of Disruptive Growth Solutions, LLC
Steven Adragna, General Manager at CDG Recruiting
