The experts have been saying it for weeks. Lower your used car inventory now. AutoRemarketing.com says "Kelley Blue Book calculated that used-vehicle values dropped 2.6 percent overall in October, marking the fifth consecutive month of wholesale declines.
Since peaking in June, KBB discovered used-vehicle values overall have sunk 10 percent with the most pronounced declines coming from fuel-efficient vehicles, falling more than 20 percent."
I am already witnessing this drop in our inventory and watch my Vrank and Price rank drop almost daily. Lowering the inventory $$$ and units has been a challenge since, fortunately for us, most of our vehicles come from trades. Since new car sales is just starting to slow, the trades continue to flow in. We haven't purchased a vehicle in almost 6 weeks and have held steady at a 150 used car inventory. Retail Used slowed from 150 to 130 and now to 102 October MTD. Our machine kept pumping them out, so when we are down 30 sold units in a month - they end up in used inventory.
The irony is as sales continue at any rate, and we overcome the sales constraints, and the inventory does drop it will have the compound effect of lower $$ investment, increased turn and increased ROI, even with reduced gross profits.
We all know the longer they sit, the less they are worth. Ever hear "Your first loss is your best loss"? Roll your used cars. Don't wait, they are not going to be worth tomorrow or the next day. Price your cars to sell and move on.
Some dealers I meet might as well order a truck load of Bronze since they will be Bronzing most of the inventory they will be buried in come model year change. If you haven't already, take action now.