Stellantis hunts for new CEO, Q3 sales forecast, negative vehicle equity spikes

Go deeper (7 min. read)

Hey, everyone. Hyundai is slashing prices on the 2024 IONIQ 5 EV with up to $14,000 in lease incentives this month — bringing payments down to under $199/month in certain markets.

Why the big push? They’re making room for the 2025 model and gearing up production at their new plant in Georgia.

Even with solid sales in Aug. and year-over-year growth so far in 2024, Hyundai is trying to clear out its inventory at lightning speeds in a win for EV-curious buyers everywhere.

—CDG

First time reading the Car Dealership Guy Newsletter? Subscribe here.

Each week, I curate the top 5 automotive industry headlines based on the topics CDG readers engaged with the most on social media. Let’s get started.

1. Stellantis hunting for possible successor to CEO Carlos Tavares

Stellantis is on the hunt for a new CEO to potentially replace Carlos Tavares when his contract ends in early 2026. Chairman John Elkann is leading the search as part of regular succession planning, though Tavares could still keep his spot. 

The pressure’s on — Stellantis has been struggling in the North American market, with profits plunging 48% and sales down 21% in the first half of 2024, leaving dealers with aging inventories. 

  • The situation has led to some high-level departures and even prompted an open letter from the Stellantis National Dealer Council criticizing Tavares’ strategy. 

  • While the company pushed back, claiming improvements in recent months, questions remain about its EV plans and cost-cutting measures. 

Big picture: Tavares, now the highest-paid auto CEO after Elon Musk, faces mounting pressure to prove he can turn things around before his contract ends.

But it appears that Q3 sales might be another roadblock for the company…

2. New car sales expected to cool in Sept. causing further slide in Q3

New vehicle sales are expected to drop this quarter as buyers keep waiting for a better market. 

What’s happening: The U.S. car market saw a wild Q3, with the CDK Global cyberattack, hurricane closures, and election season uncertainty all playing a role.

By the numbers: Edmunds forecasts Q3 sales at 3.9 million units—down 2.3% from last year and 4.7% from Q2.

  • Stellantis and Toyota are projected to see the biggest declines, with drops of 10.5% and 4.7%, respectively.

  • Meanwhile, Honda and Ford are bucking the trend, with Honda showing a 9.9% year-over-year increase and a 4.6% jump from Q2.

Zooming out: Affordability remains the main challenge, according to Edmunds’ Jessica Caldwell, as inventory levels are high enough to meet demand, limiting incentives. Despite a weak Sept., combined Aug. and Sept. sales were still up 2.6% year-over-year, indicating some stability.

One of the craziest things about the Car Dealership Guy platform:

Our direct access to literally thousands of dealership and automotive employees.

So naturally, I often hear this question:

“CDG, can you use your network to help me fill an open role at my company?”

Well, now I can.

Building on the success of my free automotive job board, I’m proud to launch CDG Recruiting — a more hands-on, white-glove automotive recruiting service.

Whether you’re looking to fill roles in dealership management, the C-suite, F&I, fixed ops, auto tech, or SaaS, we take the hassle out of hiring by doing the heavy lifting for you.

And here’s the best part:

We vet and screen thousands of candidates, so you don’t have to. And with our placement guarantee, hiring through CDG Recruiting is 100% worry-free.

Our team has decades of experience and has successfully placed over 1,000 roles in the automotive industry.

If you’re ready to find your next rockstar employee, try CDG Recruiting today.

As the new car market cools, the used car side of things is heating up…

3. Used car buyers are finally being rewarded for their patience

Used car prices are dropping, offering a bit of relief for buyers and dealers as 2024 winds down. 

Context: According to iSeeCars, 1-to-5-year-old used vehicles averaged $32,672 in Aug.—down 4.7% from last year. 

The real story? A surge in sub-$20,000 vehicles, which now make up 16.5% of the market, a 30% jump from 2023.

Why it matters: While prices are still 40% higher than before the pandemic, the return of cheaper models is driving more customers back to the used lot. In fact, used car sales jumped nearly 14% year-over-year in August, hitting levels not seen since late 2021.

Despite new vehicle sales dipping, a better used inventory mix could keep demand strong heading into the remainder of 2024.

Although, whether it's a new or used car purchase, surging negative equity could stop potential buyers in their tracks…

4. Negative equity spikes in Q3, EV owners hit hardest

Driving the news: Right now, 31% of auto loans are underwater, meaning many buyers owe more on their vehicles than they’re worth, according to a Q3 survey by CarEdge. That’s up sharply from earlier this year and could complicate trade-ins and sales.

  • The issue is hitting certain groups harder—31% of those who bought new cars in the last two years are underwater, as are nearly half of EV owners. 

  • Drivers with longer loan terms are also struggling, with those on 84-month loans having a median equity of -$4,920.

What it means: For dealers, this means more tough conversations and possibly fewer sales as buyers hold off on purchases. Understanding who’s most affected by negative equity will be key to setting realistic expectations and guiding customers through their next purchase.

Have a tip for our editorial team? Send us your scoop at [email protected].

But it could lead to more consumers embellishing their financial health through less than savory means…

5. Heightened consumer fraud risks threaten dealerships

New types of fraud, fueled by generative AI (gen-AI), are creating new headaches for dealerships. 

The details: Experian’s latest U.S. Identity and Fraud Report shows a growing gap between what companies are prepared to handle and the fraud they’re actually facing.

  • The top threats in 2024 are identity theft (28% of reported fraud), followed by wire transfer and new account opening fraud.

The intrigue: While businesses feel most confident tackling first-party and transactional payment fraud, gen-AI is enabling more complex crimes like synthetic identity theft—a huge concern for auto lenders, who saw this type of fraud spike by 98% last year.

  • Despite these risks, combating AI-enabled crime is low on the priority list for many companies, even though 51% of financial institutions lost millions to it in 2023. 

Bottom line: As fraud continues evolving, auto retailers need to step up security measures with advanced fraud detection tools to protect their businesses and build consumer trust.

We’ve got tons of great jobs hitting the CDG Job Board right now:

  • Edmunds is looking for an

  • in Northwest Illinois.

  • Ron Marhofer Auto Family needs a Used Vehicle Buyer near Akron, OH.

  • MotorEnvy is on the hunt for a Head of Operations in New Jersey.

Looking to hire? Add your roles today—it’s 100% free.

That’s a wrap for now – make sure you’re following along on X, LinkedIn and IG for more real-time updates.

🚨 Hey you! Before you go…

Did you like this edition of the newsletter?

Tell us what you think

Login or Subscribe to participate in polls.

Thanks for reading. Hit reply and let me know if you found this week-in-review valuable or have any feedback. I’ll see you next weekend.

—CDG

Want to advertise with CDG? Click here.

Want to be considered as a guest on the CDG podcast? Right this way.

Want to pitch a story for the newsletter? Share it here.

Reply

or to participate.