Off-lease shortage will be short-term
According to online auto auction company OPENLANE, 2010 marked a slow but steady road to economic recovery — a welcome change following the troubles
the automotive industry experienced in late 2008 and throughout 2009. For 2011, the company’s vice president of analytics, Dr. Nagi Palle, offers the following predictions for the remarketing industry:
• Fallout from the lack of
vehicle leasing over the past
two years will result in tight
off-lease used-vehicle supply,
but this, coupled with a
strong used-car market, will
keep used-vehicle values high.
• Off-lease shortfalls will be
offset in part by other
industry segments, such
as dealer consigned, that
are showing good traction
and providing additional
used-vehicle supply to
meet demand.
• Leasing trends will be
cyclical and should only
affect the used-vehicle
supply throughout 2011 and
2012. A significant upswing
in new leases throughout
2010 will lead to an increase
in off-lease volume in late
2012 and beyond.
• Constrained vehicle supplies
will require dealers to make
vehicle purchases at the earliest
opportunity to meet customer
needs and demand.
• Customer service will continue
to be a differentiator and
high priority for dealers to
retain customers.
• Online auctions will continue
to grow as adoption of the
online channel by dealers
and partners throughout the
automotive industry becomes mainstream.
• The recovery and independent
auction sectors and dealer-
consigned vehicles will continue
to grow as additional inventory
sources for online auctions.
OPENLANE’s 2011 forecast is reported in greater depth on www.canadianautodealer.ca.
