In recent years, the sale of used cars has become a major source of profits for many new car dealers in the wake of shrinking margins on new cars. And to make them acceptable to more customers, some dealers promote “certified pre-owned” vehicles to customers who want a warranty on their used vehicle. This often raises the price, but in return provides customers with peace of mind. In economic downturns, the relative demand for these and other used cars often increases as sales of new cars decline.
Nationwide used automotive dealer chains have increased in popularity over the last decade. Like the used car departments of new car dealers, they capitalize on the relatively large profits on sales of previously owned cars, trucks, and vans. Some of the larger dealers offer low-hassle sales on large inventories of these used vehicles. Growth in leasing agreements and rental company inventory will continue to provide quality vehicles to these large independent dealers, thus providing for future employment growth in the used car market.
In an effort to achieve greater financial and operational efficiency and flexibility, greater emphasis will be placed on aftermarket services, such as financing and vehicle maintenance and repair, at both new and used car dealers. These services typically provide large profit margins for dealers, and remain less susceptible to business cycle downturns. They are also part of an effort to enhance customer loyalty and overall customer service.
Perhaps the most significant recent development for automotive dealers has been increasing use of the Internet to market new and used cars and light trucks. Through websites, consumers can easily access vehicle reviews; view pictures of vehicles; and compare models, features, and prices. Many Websites also allow consumers to research insurance, financing, leasing, and warranty options. As a result, consumers are generally better informed and spend less time meeting with salespersons.
Nationwide used automotive dealer chains have increased in popularity over the last decade. Like the used car departments of new car dealers, they capitalize on the relatively large profits on sales of previously owned cars, trucks, and vans. Some of the larger dealers offer low-hassle sales on large inventories of these used vehicles. Growth in leasing agreements and rental company inventory will continue to provide quality vehicles to these large independent dealers, thus providing for future employment growth in the used car market.
In an effort to achieve greater financial and operational efficiency and flexibility, greater emphasis will be placed on aftermarket services, such as financing and vehicle maintenance and repair, at both new and used car dealers. These services typically provide large profit margins for dealers, and remain less susceptible to business cycle downturns. They are also part of an effort to enhance customer loyalty and overall customer service.
Perhaps the most significant recent development for automotive dealers has been increasing use of the Internet to market new and used cars and light trucks. Through websites, consumers can easily access vehicle reviews; view pictures of vehicles; and compare models, features, and prices. Many Websites also allow consumers to research insurance, financing, leasing, and warranty options. As a result, consumers are generally better informed and spend less time meeting with salespersons.
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