OEMs Focusing on Pre-Owned Vehicle Market; GM & Ford Moving Dealers to Take on Carvana & CarMax; GM Seeks Market for Smaller Dealers;

PREOWNED VEHICLE MARKET 

SITUATION:
Pre-owned Vehicle Sales were 3 Times as many as new vehicle sales in 2021.
CarMax and Carvana collectively lost $3.6 B in market value in 2021 or of late.
GM launched Car Bravo to sell more used vehicles on line.
Used Vehicle Market is fragmented;

TAKE AWAYS:
Pre-owned vehicles are more profitable than new.
Note that Ford signage & marketing uses term “Pre-Owned” Not Used Cars

STATS
35% of dealer sales were pre-owned in 2021;
Largest Retailer, CarMax, had 2% of total auto sales in 2021;
Carvana & CarMax spent $300 M in 2020
Trade Ins are major source of inventory.

SOURCES:
Why Detroit Loves That Used-Car Smell- https://flipboard.com/@wsj/top-news-32bs0ev6z/-/a-q8RE_21LSxGlKT97rTQL4w%3Aa%3A248213600-%2F0

SIGNIFICANT PEOPLE::
Tina Miller, Lithia CFO
Michael Montani, Analyst, Evercore

 

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