As 2022 nears its end and the new year approaches, unique challenges introduced by the global pandemic and ongoing chip and raw material shortages have rocked the automotive industry worldwide.
Explore auto-selling market trends and projections for 2023 to learn what car dealers should expect in the coming year and how the digital platform BidWizer can help your dealership thrive.
Predicted Increase in Car Sales Despite Low Confidence
According to recent forecast analyses by industry experts, current and future market performance will likely be driven by supply for new and used cars. New car sales are expected to increase by 22% in 2023.
Research conducted by J.P. Morgan’s market analysis team indicates that used car prices have likely peaked. Used car prices are set to decline gradually throughout the year, with a predicted drop of between 10% to 20%.
Although new car prices will also drop, they are expected to remain higher than their pre-pandemic prices because global supply chain issues will not likely be resolved until summer 2023. J.P. Morgan predicts new car prices will decline by 2.5% to 5% on average in 2023.
Although Demand is High, Supply is Struggling
Despite anticipated price reductions, new and used car prices likely won’t return to pre-pandemic levels until 2025. In addition to global circumstances, the primary cause is a shortage of used but recent vehicles (1- to 3-year-old models).
Car dealerships should still expect a supply shortfall for 2023, with a total wholesale market vehicle volume projected to be 31% lower than pre-2020 levels.
Used EVs Are the Surging New Trend
According to the Recurrent Q3 Used Electric Car Market Report, the electric vehicle (EV) category is experiencing an increase in used car value. Prices have exceeded the average nationwide automotive Consumer Price Index (CPI) by 12%.
Consumers are increasingly interested in used EVs, and many vehicle classes are breaking sales records, such as the electric SUV and pick-up categories. An increase in gasoline prices and the high overall cost of automobile ownership primarily drive the demand.
Recurrent’s Q4 report suggests these prices may finally stabilize. However, with a predicted price decline in 2023, demand will remain high, as used EV prices are expected to drop slowly.
A critical factor behind the high demand is the accelerating rate of EV adoption nationwide. This phenomenon is driven by new and upcoming state and federal legislation.
These laws include the Inflation Reduction Act of 2022 and its new, used EV tax credit scheme or California’s Executive Order N-79-20, which aims to phase out sales of new internal combustion engine vehicles by 2035.
Keep Up Supply at Your Dealership with BidWizer
To boost your inventory and keep customers happy in 2023, it’s vital to use modern, convenient methods to move old inventory and bring in new cars. BidWizer offers a free digital platform for dealers to help you get the supply you need without turning to traditional wholesale auctions.
Our platform is encrypted and 100% secure. It also provides unparalleled access by allowing you to search for and review available inventory from any mobile device. You can sign up in less than two minutes and begin chatting with wholesale dealers to buy or sell inventory.
Sign up for BidWizer today to start selling more cars and see your dealership thrive in 2023.