USED CAR PRICES PLUMMET! Dealers Will Take MAJOR LOSSES!

Summary

The used car market is crashing as wholesale prices plummet. Sellers are refusing to lower prices, leading to a massive increase in no-sale vehicles at dealer auctions. An auctioneer warns sellers to lower prices or their cars will be towed. Despite extremely high mileage, vehicles like a Toyota Sienna van with 576,000 miles still won't sell. An F-150 with 129,000 miles drops from $25,000 to $15,000 with no bids until it sells for just $15,500. Sellers are in denial as auction prices show the market crashing, but more declines are coming when they finally relent and sell their cars at real market value.

Takeaways

• 😬 There is a massive problem in the used car market with 'no sales', where sellers reject bids that are too far below their asking price.
• 😟 Wholesale used car prices are dropping very quickly as sellers fail to align with the market downtrend.
• 😠 Auction owners are getting frustrated with cars not selling after 3+ weeks and are threatening to tow unsold vehicles off the lot.
• 😳 Some vehicles are getting no bids even after huge price drops, like a 2017 F-150 starting at $25k and dropping to $15k with no bids.
• 😖 Many repossessed vehicles have mechanical issues since owners stop paying when something goes wrong and they can't afford repairs.
• 😕 A 10 year old Jeep with 97k miles looks decent outside but has water damage inside that hurt the sale price.
• 😢 Sellers continue to reject fair bids hoping for a 'magical buyer' who will overpay, but these buyers don't exist.
• 🙄 Franchise dealers are sending near new vehicles to auction instead of retailing them without clear explanation.
• 😐 Cosmetic issues like torn seats and trash lower sale prices, but mechanical issues are worse.
• 😞 Sellers need to accept the falling market prices and sell their vehicles now before it crashes further.

Q & A

Why are no sales a big problem at used car auctions?

No sales indicate that sellers are not willing to drop prices to match current wholesale market rates. This means sold prices are artificially high right now. When sellers finally start selling at true market prices, there could be a crash in wholesale values.

What is contributing to the downtrend in wholesale used car prices?

Growing gaps between seller asking prices and what dealers are willing to pay at auctions. As this gap widens, more no sales occur, delaying true price discovery in the market.

Why did the auction owner threaten to tow unsold vehicles?

The auction owner wants to encourage sellers to adjust prices and sell vehicles rather than let them sit unsold for weeks taking up parking space. This indicates growing frustration with lack of sales.

What issues were seen with the Ford F-150 at the auction?

The 2017 F-150 had no bidders despite good exterior condition. However, dirty, stained interior likely hurt value. Went unsold even at a huge discount to $15,000 asking price.

What mechanical issues are common with repossessed vehicles?

Repossessed vehicles often have undisclosed mechanical defects since financially struggling owners cannot afford repairs. This was seen with multiple vehicles noted to have 'bad motors'.

What happened to the paint on the Tahoe with 999,000 miles?

The Tahoe's hood and sides were covered in fine scratches, likely from driving through overgrown vegetation. This required a hood replacement and paint work.

Why was there water damage in the 2013 Jeep Wrangler?

The Jeep seemed to take on water damage after its windows were left open during heavy rain while staged for auction the previous week.

Why would a near-new 2021 Cadillac be sold at this auction?

It is unclear why this vehicle was wholesaled. The selling franchise dealer likely could have retailed it successfully rather than trading it in.

What was the outcome of the call made on the Cadillac after no sale?

There was likely no deal reached in the follow-up call, given the comment about 'probably not getting it done' regarding final negotiation.

What advice does the video narrator offer to used car dealers?

He strongly advises dealers to sell down inventory immediately rather than wait for the market to rebound. Prices are in a downtrend and holding cars is risky.