Welcome to this week’s episode of Used Cars Weekly, the original CBT News show dedicated to bringing car dealers best practices and tips for the used car department, in-depth dealer interviews, hands-on dealership strategies, as well as vendor analysis. Today, host Jasen Rice, founder of Lotpop, discusses what the upcoming tax season likely has in store for the used car market in 2022.
Google Trends reveals that used cars, as a search term, is at its lowest level in five years. Combined with an increasingly low two-weeks sales volume average, even active car dealers are struggling with volume right now. Rice adds that car dealers need to pay attention to the rise in auto defaults as well.
COVID stimulus packages are also starting to fade away, and the IRS is dealing with a mounting backlog of paperwork. Average used vehicles prices also hit a new all-time high of $29,000 and while vehicle supply is starting to come back, dealers will still have to source more cars from consumers.
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Decide for yourselves whether or not you think this year will have a strong tax season. For used car operations, Rice says keep it lean and clean. Be careful of overstocking and monitor inflation. Look at your last two-week sales cycle and make your determination based on trends.
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