SANTA MONICA, Calif., Feb. 18, 2015 /PRNewswire/ -- Certified pre-owned (CPO) car sales are at an all-time high, say analysts at Edmunds.com, the premier destination for car shopping.
In the company's latest Used Vehicle Market Report, available at http://www.edmunds.com/industry-center/, Edmunds.com analysts noted that in 2014 CPO sales hit an all-time high of 2.3 million -- even though it was not a record year for used car sales overall. Last year, CPO made up 20.8 percent of total used car sales at franchised dealerships, the highest percentage since certified pre-owned programs were introduced.
"We fully expect CPO popularity to continue throughout 2015 because many leased cars are being returned to the dealership in excellent shape and lightly used cars are being traded in at faster rates than in previous years. This allows dealers to maintain a large CPO inventory," explained Edmunds.com Senior Analyst Jessica Caldwell. "Car shoppers are finding a great selection to choose from, and, in the current economy, many are comfortable spending a bit more for that extra peace of mind that a CPO car brings."
Even though there are more used cars in the marketplace than in recent years, retail prices have remained high. In fact, with a six percent gain in year-over-year used prices, 2014 generated record high average used vehicle retail values. The average price for a used vehicle sold at a dealership last year was $16,800, compared to $15,900 in 2013. In 2014, the average one-year old vehicle sold for almost $30,000, 5.7 percent higher than in 2013.
"Lightly used cars are very appealing to car shoppers since they are equipped with modern technology and have already taken their biggest depreciation hit," said Caldwell, who pointed out that 19 percent of used vehicles sold in 2014 were one or two years old, up from 14 percent in 2013.
Another factor that boosted average retail used car prices in 2014 was the dramatic decline in gas prices: this drew a greater proportion of shoppers to larger vehicles, which typically cost more. In addition, low interest rates and longer loan repayment terms allow shoppers to buy more expensive vehicles with lower monthly payments, and all of these trends were realized in 2014. Despite higher average prices, the average monthly payment for used cars financed in 2014 was $370, three dollars less than the all-time high that was reached in 2007.
The Edmunds.com report also tracked the average age of car shoppers and found that Millennials are a growing customer base for used cars. "As new jobs and other changes in their lifestyles lead them to buy cars, Millennials are using their smartphones to find the best deals and are often choosing used over new," observed Caldwell.
The full Used Vehicle Market Report and other insight into recent auto industry trends can be found in Edmunds.com's Industry Center at http://www.edmunds.com/industry-center/.
About Edmunds.com, Inc.
Car-shopping website Edmunds.com serves nearly 18 million visitors each month. With Edmunds.com Price Promise®, shoppers can get an instant, upfront price for cars and trucks currently for sale at 10,000 dealer franchises across the U.S. Car shoppers can browse not only inventory listings at Edmunds.com and on its acclaimed apps, but also comprehensive car reviews, shopping tips, photos, videos and feature stories. Named by Maritz Research as one of the most trusted online consumer review sites – and the only automotive site listed in the top ten – Edmunds.com welcomes all car-shopping questions on its free Live Help Line at 1-855-782-4711 and firstname.lastname@example.org, via text at ED411 and on Twitter and Facebook. Based in Santa Monica with a satellite office in downtown Detroit, Edmunds.com can also be found on Pinterest, LinkedIn, Instagram, and Google+ and Flipboard.