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☆ Auto Industry Expects Minimal Disruption From Port Shutdown
▼ + stars: | 2024-03-28 | by ( Neal E. Boudette | More About Neal E. Boudette | ) www.nytimes.com time to read: 1 min

Concerns about the impact of the Baltimore bridge collapse on auto imports and exports are beginning to ease as car companies turn to other ports along the East Coast. On Thursday, Cox Automotive, a market researcher, said it expected the situation in Baltimore to have no material impact on vehicle sales in the United States. “While Baltimore is the top port for auto shipments, this is not likely to cause or create a sudden new problem in vehicle supply that will materially impact the market,” Jonathan Smoke, Cox’s chief economist, said in a conference call. “The port is heavy for exports and imports, but there are alternatives.”Mercedes-Benz said it has already found other ways of handling the vehicles it usually imports from Germany through Baltimore.

Persons: Jonathan Smoke, ” Mercedes, Benz Organizations: Cox Automotive Locations: Baltimore, East Coast, United States, Germany

☆ Used car prices expected to stabilize in 2024 after two years of decreases from record highs
▼ + stars: | 2024-01-08 | by ( Michael Wayland | ) www.cnbc.com time to read: +2 min

(Staff photo by Brianna Soukup/Portland Press Herald via Getty Images)DETROIT — Used vehicle prices are expected to stabilize this year, after buyers of pre-owned cars and trucks got more relief in 2023 following a stretch of record prices. However, used vehicle prices are still higher than they were before the pandemic. Retail prices for consumers traditionally follow changes in wholesale prices, but they have not fallen as quickly as wholesale prices in recent years. Used vehicle sales are expected to increase by less than 1% to 36.2 million, according to Cox Automotive. That forecast includes 19.2 million in used vehicle retail sales.

Persons: Brianna Soukup, Cox, we've, Jeremy Robb, Jonathan Smoke Organizations: Lee, Portland Press, Getty, Automotive, Cox Automotive Locations: Manheim, U.S

☆ Federal Reserve Meeting Fed Expected to Keep Rates on Hold
▼ + stars: | 2023-11-01 | by ( Jeanna Smialek | ) www.nytimes.com time to read: +7 min

The Fed last raised its benchmark rate, the federal funds rate, in July to a range of 5.25 to 5.5 percent. In recent weeks, the long-term market rates that influence many types of consumer and business loans have drifted higher, even as the Fed left its key rate on hold. Car LoansHigher loan rates have been dampening auto sales, particularly in the used-car market, because loans are more expensive and prices remain high, experts said. Used-car rates were even higher: The average loan carried an 11.4 percent rate in September, matching a high set earlier in the year. Home-equity lines of credit and adjustable-rate mortgages — which each carry variable interest rates — generally rise within two billing cycles after a change in the Fed’s rates.

Persons: ”, Anna N’Jie, Bankrate.com, Matt Schulz, Jonathan Smoke, that’s, Freddie Mac, Ken Tumin, DepositAccounts.com Organizations: Federal Reserve, Fed, Re, LendingTree, Cox Automotive, Treasury, Savings Vehicles Savers, Consumers, DepositAccounts.com Locations: LendingTree

Customers might assume that nonunion automakers, like Toyota, Tesla or Hyundai-Kia, will now be able to price their vehicles well below what the Detroit automakers can. “When the dust settles from this UAW debacle, the Detroit auto stalwarts find themselves with a bigger cost profile with competition increasing," said Dan Ives, an analyst at Wedbush. That means that competition for buyers is intensifying as pent-up demand from the pandemic wanes, making it difficult for any automaker to raise prices. But if the Detroit companies report lower income, Wall Street will register its disappointment, and stock prices could fall. “You either raise your labor costs to meet what the UAW is getting or you risk the unionization drive.”

Persons: Stellantis, ”, Jonathan Smoke, pare, Dan Ives, Natalie Knight, Ram, Knight, Smoke, Shawn Fain, Fain, Art Wheaton, wouldn’t, Wheaton, Tesla, ” Wheaton Organizations: DETROIT, United Auto Workers, Detroit’s, General Motors, Ford, Toyota, Hyundai, Kia, Detroit, GM, Cox Automotive, UAW, Chrysler, Jeep, Cox, automakers, Detroit automakers, Cornell University, U.S Locations: United States, U.S, Stellantis, Detroit

☆ GM's third-quarter sales jump 21% as UAW strike slowly expands
▼ + stars: | 2023-10-03 | by ( Michael Wayland | ) www.cnbc.com time to read: +1 min

DETROIT – An ongoing strike by the United Auto Workers union against the Detroit automakers had little to no direct effect on General Motors' third-quarter U.S. new vehicle sales. Sales of every one of the Detroit automaker's brands rose compared to a year earlier. Only 25,200 workers, or roughly 17% of UAW members covered by the expired contracts with GM, Ford Motor and Stellantis, are part of the work stoppages. UAW has been gradually increasing the strikes since the work stoppages began, after the sides failed to reach tentative agreements by Sept 14. The targeted walkouts aim to preserve the union's funds and prolong the work stoppages to keep the automakers off keel.

Persons: Jonathan Smoke Organizations: United Auto Workers, UAW, General Motors Co, Flint Processing, Detroit automakers, General Motors, Detroit, GM, Ford Motor, Chevrolet Colorado, GMC, Cox Automotive Locations: Swartz Creek , Michigan, DETROIT

☆ Beyond the automakers: How the UAW strike may hit the US economy
▼ + stars: | 2023-09-16 | by ( Elisabeth Buchwald | ) edition.cnn.com time to read: +4 min

UAW president Shawn Fain said “we’re not going to wreck the economy. For instance, if all UAW workers at Ford, General Motors and Stellantis strike for 10 days, it would cost the US economy $5 billion, according to Anderson Economic Group’s estimates. He estimated $440 million worth of income would be lost nationally if all the UAW members strike for two weeks. If the strike lasts eight weeks, he estimates a $9.1 billion hit to incomes nationwide. Cars could get more expensiveAnderson Economic Group estimated that 25,000 vehicles won’t be produced if the strike lasts 10 days.

Persons: ” Gabriel Ehrlich, Shawn Fain, “ we’re, Ehrlich, Tyler Theile, That’s, they’re, Theile, Jonathan Smoke, CNN’s Peter Valdes, Dapena Organizations: New, New York CNN, United Auto Workers, University of Michigan, CNN, UAW, Ford, General Motors, Anderson Economic, Anderson Economic Group, Suppliers, Big, Cox Automotive Locations: New York, what’s, Michigan

☆ Buying a car? What the UAW strike means – and doesn’t mean – for auto sales
▼ + stars: | 2023-09-15 | by ( Peter Valdes-Dapena | ) edition.cnn.com time to read: +5 min

New York CNN —Now that the United Auto Workers union has started a strike, the US auto market is about to be thrown into turmoil all over again. Auto sales hadn’t entirely recovered from the pandemic, but car shopping in the United States could change once more. The auto manufacturing crises of recent years have left auto dealers better prepared to deal with disruptions, said Scott Kunes, chief operating officer of Kunes Auto and RV Group, which owns more than 40 dealerships in the Midwest. It pays to be flexibleBefore the strikes started, auto dealerships had reasonably healthy inventories of new vehicles, according to Michelle Krebs, an analyst with AutoTrader. That means they’ll still have vehicles to sell for a few weeks, but, as the strike wears on, the choices available will start to dwindle.

Persons: They’re, Jonathan Smoke, Scott Kunes, ” Kunes, “, Kunes, Tyson Jominy, JD Power, Thomas Goldsby, Jominy, Michelle Krebs Organizations: New, New York CNN, United Auto Workers, Auto, Ford, GM, Cox Automotive, Kunes, RV Group, Toyota, BMW, Hyundai, Nissan, Volvo, Subaru, South Korean, JD, University of Tennessee, Trailblazer, Dodge, AutoTrader Locations: New York, United States, Michigan, Canada, Mexico, South Korea

☆ Federal Reserve Meeting Fed Expected to Resume Rate Increases
▼ + stars: | 2023-07-26 | by ( Jeanna Smialek | ) www.nytimes.com time to read: +7 min

The Federal Reserve has already raised its benchmark rate, the federal funds rate, to a range of 5 to 5.25 percent to rein in inflation, which is showing signs of slowing. The average credit card rate was 20.44 percent as of July 19, according to Bankrate.com, up from around 16 percent in March last year, when the Fed began its series of rate increases. The average rate on new car loans in June was 7.2 percent, up slightly from the start of the year, according to Edmunds.com. The average rate for an identical loan was 5 percent the same week in 2022. But yields on money market funds offered by brokerage firms are even more alluring because they have tracked the federal funds rate more closely.

Persons: ”, Anna N’Jie, Bankrate.com, Matt Schulz, Jonathan Smoke, that’s, —, Freddie Mac, Ken Tumin, DepositAccounts.com Organizations: Federal Reserve, Federal, Fed, Re, LendingTree, Cox Automotive, Treasury, Savings Vehicles Savers, Consumers, DepositAccounts.com Locations: Chicago

☆ Used car prices expected to stabilize following major decline in June
▼ + stars: | 2023-07-10 | by ( Michael Wayland | ) www.cnbc.com time to read: +2 min

DETROIT – Wholesale used vehicle prices posted their largest decline last month since the beginning of the coronavirus pandemic, as prices are set to stabilize during the second half of this year. Cox Automotive reported Monday a 4.2% decline from May to June in its Manheim Used Vehicle Value Index to 215.1. The decline could help bring used vehicle pricing down for consumers in the months to come, as retail prices traditionally follow changes in wholesale prices. Cox Automotive expects wholesale used vehicle prices to be down roughly 1.1% at the end of this year compared to December 2022. Cox expects the used vehicle wholesale market to experience a "slow and gradual recovery" in prices to pre-pandemic levels by 2028.

Persons: Roger Beasley, Cox, Chris Frey, Jonathan Smoke Organizations: DETROIT –, Cox Automotive Locations: Austin , Texas, DETROIT

☆ US new vehicle sales rise on strong demand, better supply
▼ + stars: | 2023-07-05 | by ( Pratyush Thakur | ) www.reuters.com time to read: +2 min

Vehicle production took a hit after the pandemic disrupted supply of semiconductor chips and other raw materials, hurting automakers' ability to meet the upsurge in demand for cars, trucks and SUVs. Toyota Motor's (7203.T) North America unit reported a 7.13% rise in U.S. sales to 568,962 units for the quarter ended June. Auto giant General Motors (GM.N), however, surpassed Toyota in the quarter, with a near 19% rise to 691,978 units in the United States. Earlier in the week, FCA US, a unit of Stellantis (STLAM.MI), reported a 6% increase in total U.S. sales. Power and GlobalData estimate total U.S. auto sales to reach 4,116,600 units in the quarter ended June, up 18.2% from a year earlier.

Persons: Cox, Jonathan Smoke, Toyota Motor's, J.D, Pratyush Thakur, Shivansh, Pooja Desai, Shilpi Majumdar Organizations: Toyota, Auto, General Motors, FCA, Tesla Inc, Thomson Locations: United States, America, Bengaluru

☆ G.M.’s Sales Jumped 19% in the Second Quarter
▼ + stars: | 2023-07-05 | by ( Neal E. Boudette | ) www.nytimes.com time to read: +1 min

General Motors said on Wednesday that its new-vehicle sales in the United States increased 19 percent from April to June, the strongest sign yet that the auto industry was bouncing back from parts shortages and overcoming the effects of higher interest rates. The automaker, the largest in the United States, said it sold 691,978 vehicles in the second quarter, the company’s highest quarterly total in more than two years. More recently, rising interest rates have made auto loans more expensive, causing some consumers to defer purchases or opt for used vehicles. “I’m not saying we are on the cusp of exciting growth here,” said Jonathan Smoke, chief economist at Cox Automotive, a research firm. “But we are now at a turning point where the auto market returns to more balance.

Persons: Motors, shutdowns, I’m, ”, Jonathan Smoke Organizations: Cox Automotive Locations: United States

☆ Used cars are never going to get any cheaper
▼ + stars: | 2023-06-29 | by ( Alexa St. John | ) www.businessinsider.com time to read: +3 min

Used car prices skyrocketed during the COVID-19 pandemic. Since the start of COVID, the used car market has been volatile, with pre-owned vehicles priced far higher than they might have been worth. 3 key factors to blame for the used car price problemLeasing has been down in recent years. Drivers are holding onto their vehicles for longer, also affecting which cars end up sold as used and in how much time. Only 30% of used vehicles sold for less than $20,000 in the first quarter of 2023, according to resource Edmunds — half of the 60% of used cars that were sold at that rate or below in 2018.

Persons: it's, Cox, Jonathan Smoke, Edmunds Organizations: Cox, Cox Automotive, Leasing

☆ Federal Reserve Meeting Fed Leaves Rates Unchanged: Live Updates
▼ + stars: | 2023-06-14 | by ( Jeanna Smialek | Joe Rennison | ) www.nytimes.com time to read: +7 min

Credit card rates are closely linked to the Federal Reserve’s actions, which means consumers have seen those rates rise over the past year. After raising interest rates 10 times over the past 15 months, the Federal Reserve is expected to take a break on Wednesday and hold rates steady. The Federal Reserve has already raised its benchmark rate, the federal funds rate, to a range of 5 to 5.25 percent to rein in inflation, which is showing signs of slowing. Used-car rates were even higher: The average loan carried a 11 percent rate in May, up from 8.2 percent a year earlier. Home-equity lines of credit and adjustable-rate mortgages — which each carry variable interest rates — generally rise within two billing cycles after a change in the Fed’s rates.

Persons: ”, Anna N’Jie, Bankrate.com, Matt Schulz, Jonathan Smoke, Edmunds.com, that’s, —, Freddie Mac, Ken Tumin, DepositAccounts.com Organizations: Federal Reserve, Fed, Re, LendingTree, Cox Automotive, Treasury, Savings Vehicles Savers, Consumers, DepositAccounts.com Locations: San Francisco .

☆ Fed Expected to Pause Rate Increases: Live Updates
▼ + stars: | 2023-06-14 | by ( Jeanna Smialek | Joe Rennison | ) www.nytimes.com time to read: +7 min

The Federal Reserve has already raised its benchmark rate, the federal funds rate, to a range of 5 to 5.25 percent to rein in inflation, which is showing signs of slowing. The average credit card rate was 20.44 percent as of June 3, according to Bankrate.com, up from around 16 percent in March last year, when the Fed began its series of rate increases. The average rate on new car loans was 7.1 percent in May, according to Edmunds.com, up from 5.1 percent last year. Used-car rates were even higher: The average loan carried a 11 percent rate in May, up from 8.2 percent a year earlier. The average rate for an identical loan was 5.23 percent the same week in 2022.

☆ How inflation and higher interest rates have reshaped car buying for many Americans
▼ + stars: | 2023-06-01 | by ( Michael Wayland | ) www.cnbc.com time to read: +1 min

The Federal Reserve's battle to taper inflation by ratcheting up interest rates is limiting who can afford to purchase a new or used vehicle. The rate hikes have many Americans lowering their buying expectations, opting for used vehicles over new, or fixing their current car or truck instead of purchasing a replacement. "We continue to see subprime buyers squeezed out of the auto market by the Fed repeatedly moving rates higher. At various points in 2018, subprime buyers made up more than 14% of new vehicle sales, while deep subprime buyers made up close to 10% of the market, according to Cox. This year, subprime buyers account for roughly 6% of new vehicle sales and deep subprime account for less than 2%, Cox reports.

Persons: Cox, Jonathan Smoke Organizations: Subaru, Cox Automotive, Fed Locations: Colma , California

☆ Why Is Inflation So Stubborn? Cars Are Part of the Answer.
▼ + stars: | 2023-05-20 | by ( Lydia Depillis | Jeanna Smialek | ) www.nytimes.com time to read: +1 min

The job market has remained strong, especially for in-person jobs in fields like hospitality and health care, so more people have workplaces to get to. And many people in between, who might switch cars every few years, are waiting for prices to fall. Wholesale car prices have begun to fall, and carmakers are offering more incentives. Prices have come down in recent months for electric cars — the fastest-growing segment of new car sales, though a small portion of the overall market. Adam Jonas, an auto industry analyst with Morgan Stanley, said that over the short to medium term, more inventory was the only answer.

"My belief is that we don't get inflation down to 2% without a recession," said Greg McBride, chief financial analyst at Bankrate. As the economy fluctuates, experts say there are several key risk areas that consumers may want to keep an eye on. That still leaves about 1.6 open jobs to every available worker, which is "very good," according to Andy Challenger, senior vice president at outplacement firm Challenger, Gray & Christmas. Pricey car loan 'quickly becomes untenable'Auto loan delinquencies are already rising, particularly for borrowers with weaker credit profiles, McBride noted. In 2022, consumers paid $133.1 billion in credit card interest and fees, a 23.1% increase from the estimated $108.1 billion they paid in 2021.

☆ Car loan interest rates are reaching record highs and taking longer than ever to pay off
▼ + stars: | 2023-04-15 | by ( Christopher Hickey | ) edition.cnn.com time to read: +4 min

High loan rates mean monthly payments are soaring as well. In March, the average monthly payment for financing a new car hit $730 — the highest on record, according to Edmunds. Most $1,000 per month car loans are taken out by people who choose high-interest, longer-term loans. While buyers who opt for longer loans are paying less money up front, interest rates catch up over time. For instance, a buyer who takes a 70 month loan for a $28,700 used car at the current average loan rate could pay 38% more just in interest.

☆ 10 auto industry predictions for investors to keep an eye on this year
▼ + stars: | 2023-01-15 | by ( Michael Wayland | ) www.cnbc.com time to read: +7 min

Cox has 10 predictions for the U.S. auto industry this year that point to such an outcome. "This is actually where we think the majority of growth will be in new vehicle sales in '23," Smoke said. Cox forecasts U.S. new vehicle sales will be 14.1 million in 2023, a slight increase from nearly 13.9 million last year. New vehicle inventory levels will continue to increaseExpectations for lower demand come as the automotive industry is slowly increasing its production of vehicles, leading to higher inventory levels. Inventory levels the past two years were at record lows due to supply chain and parts problems affecting production.

☆ Used vehicle prices are falling but not enough to offset grossly inflated levels
▼ + stars: | 2023-01-09 | by ( Michael Wayland | ) www.cnbc.com time to read: +2 min

DETROIT — Used vehicle prices are expected to come down further this year amid rising interest rates and improved availability of new cars and trucks, according to Cox Automotive. The automotive data firm expects wholesale prices on its Manheim Used Vehicle Value Index, which tracks prices of used vehicles sold at its U.S. wholesale auctions, to end the year down 4.3% from December 2022. As supply in new improves demand for us is declining," Cox Automotive chief economist Jonathan Smoke said Monday. The declining rates are good news for the Biden administration, which a year ago blamed much of the rising inflation rates in the country on the used vehicle market. The Manheim Used Vehicle Value Index increased by less than 1% from November to December.

☆ Consumers kept the economy hot in 2022. Now they’re losing steam
▼ + stars: | 2022-12-28 | by ( Alicia Wallace | ) edition.cnn.com time to read: +8 min

Consumers armed with plenty of pandemic-induced pent-up demand and bountiful financial buffers kept the economy churning throughout much of 2022. “But I think there are reasonable worries that may not last.”Consumer spending remained resilient throughout much of 2022. But the household savings rate now sits at 2.4%, the lowest level since 2005 and the second-lowest rate going back more than 60 years. As of September 30, credit card delinquencies remained near historic lows with a 2.07% rate, according to Federal Reserve data. Persistently high inflation has consumers leaning more on credit cards and other forms of financing.

High interest rates, supply chain problems and recessionary fears were among the major challenges for the global automotive industry in 2022. Auto sales could still riseUnlike traditional downturns or past periods when demand was soft, most analysts expect global and U.S. auto sales to rise in 2023. Cox Automotive is forecasting U.S. new vehicle sales of 14.1 million in 2023, which Charlie Chesbrough, Cox's senior economist and senior director of industry insights, described as "tepidly optimistic." S&P Global Mobility expects new vehicle sales globally to reach nearly 83.6 million units in 2023, a 5.6% increase from the previous year. US consumers are hunkering down, and recovery towards pre-pandemic vehicle demand levels feels like a hard sell.

☆ It's the best time to buy a used car in 16 months — as long as you don't have to take out a big loan
▼ + stars: | 2022-12-08 | by ( Jacob Zinkula | Madison Hoff | ) www.businessinsider.com time to read: +4 min

Used car prices have fallen to their lowest level since August 2021. As the Federal Reserve has raised interest rates in an effort to cool inflation, interest rates on car loans have risen in tandem. In October, the average annual percentage (APR) rate on used car loans rose to 9.6%, the highest level in over a decade. For those less reliant on financing for their car purchases, however, this could be their best chance to buy an affordable car in over a year. While the new car market is expected to cool off as well, used car prices continue to be where the best bargain is.

☆ Used vehicle demand and prices continue to decline from record highs
▼ + stars: | 2022-12-07 | by ( Michael Wayland | ) www.cnbc.com time to read: +2 min

DETROIT – Wholesale prices of used vehicles reached their lowest level in more than a year last month, as retail sales decline amid interest rate hikes, rising new vehicle availability and recessionary fears. Cox Automotive said Wednesday that its Manheim Used Vehicle Value Index, which tracks prices of used vehicles sold at its U.S. wholesale auctions, has declined 15.6% from record levels in January through November. "New inventory is finally starting to build, and that's producing momentum in new retail sales, but that momentum appears to be at the expense of used retail. Retail prices for consumers traditionally follow changes in wholesale prices. Cox estimates that used retail sales declined 1% in November from October and were down 10% from a year earlier.

☆ There are finally more cars to buy — but there's a new reason Americans can't afford them
▼ + stars: | 2022-11-03 | by ( Tim Levin | ) www.businessinsider.com time to read: +3 min

High interest rates are hitting car buyers just as vehicles are becoming more available. The Federal Reserve raised interest rates again on Wednesday by .75% to TKSign up for our newsletter for the latest tech news and scoops — delivered daily to your inbox. But climbing interest rates are throwing a wrench in the cogs. The Federal Reserve has hiked interest rates several times this year — most recently on Wednesday — with the intention of cooling spending and taming record-high inflation. "New cars may finally become more available just when most Americans can no longer afford them," Cox chief economist Jonathan Smoke said in an October note.

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