Read up, watch out and listen in for these issues during Used Car Week 2017
The past year has seen a flurry of activity in the automotive industry, from consistent booms to potential busts. With Used Car Week 2017 in three weeks, here are some key issues we’ll explore during our five days in glorious La Quinta, Calif. Cross-reference these topics with the agenda and start formulating a game plan on the mobile app now.
1. Fallout from Hurricanes Harvey, Irma and Maria
Harvey, Irma and Maria devastated the southeastern third of the U.S., whipping from Texas to Georgia to Puerto Rico. Auto operations in affected areas still feel strong ripples due to the power of these storms.
While automotive groups like Penske and Sonic reported stock downturns due to the hurricanes, the storms visited wider-ranging consequences past temporary capital losses. For example, many cars received unsalvageable damage, but can their former owners afford to purchase replacements? And according to Edmunds, 366,000 new cars sat like sinking ducks in the path of Hurricane Harvey — consider the new and used inventory impacted by Irma and Maria on top of that destruction.
Plenty of sessions during Used Car Week will surely address the implications. For example, J.D. Power senior director of automotive consulting & analytics Tyson Jominy recently wrote about the effect of the hurricanes, and he will be speaking during Used Car Week’s general session, “The State of the Industry,” on Monday afternoon. If you stick around for the Second Block, the National Remarketing Conference National Panel on Thursday morning will also be a prime spot to hear about the hurricanes’ aftershocks on wholesale pricing.
2. Recent CPO upswings and deals
The pre-owned market looks as strong as it ever has in 2017. While numbers wavered during the summer months, the market stayed ahead of 2016’s year-to-date, and the second and third quarters of 2017 marked the best and second-best quarters in the history of CPO sales.
Companies throughout the industry jumped to take advantage of this momentum. CertifiedCars.com facelifted their site during the middle of the summer, while automakers from BMW and Mercedes to GMC and Honda announced attractive incentives for CPO vehicles this fall to close out this historic year on a high point. Additionally, American Honda Motor Co. recently initiated a 182-point digital checklist for their Honda and Acura CPO programs.
With all these developments, you’ll want to hustle to Pre-Owned Con workshops (like “Sell More Vehicles Without Spending More Money” on Monday afternoon) to snag a seat before they’re all claimed.
3. Emerging tech and other disruptors
In our ever-shifting digital world, keeping an eye on technological innovations becomes a must if you want to stay in peak form in your industry. This year has proven to be an innovative sprint on all fronts, from financing to repossession.
Debuted on the Apple App Store in early September, the Fair app seems poised to disrupt the auto-finance world by making leasing and ownership highly flexible, helmed by two industry dynamos and closing deals with BMW i Ventures and Penske. Other similar alternatives, like Honcker, Swapalease and Flexdrive, should develop an intriguingly competitive atmosphere.
Whichever con you’re most interested in, you’re guaranteed to hear about these new advances, from Auto Fin Con’s “The Future of Payment Technologies” or Repo Con’s “Big Data and Modeling in Auto Recovery” (featuring RepoRoute’s Steve Schreider) to Pre-Owned Con’s “The Rise of Intelligent Agents” (with CarStory’s Chad Bockius) and NRC’s “The Future of Wholesale Disruption” during Second Block.
4. Carvana’s rolling expansion
Talk about a disruptor! It seems like the Auto Remarketing staff from Senior Editor Joe Overby on down has written about Carvana a billion times since last year’s UCW.
But you simply can’t overlook the online car retailer’s impact over the past 12 months, opening markets in eight state capitals from their home base of Phoenix, Ariz. to Raleigh, N.C., nearby our offices — and it’s got one of those nifty vending machines, at that! The novel service also opened locations in over a dozen other metropolitan areas, from Philadelphia to San Antonio and most recently in Jacksonville, Fla.
Along with their inflating market presence, Carvana acquired Carlypso, a managed wholesale-vehicle marketplace, and in retaining Carlypso’s founders in leadership roles, plans to further develop its established tools for Carvana’s own growth.
Scott Wood, Carvana’s director of trade and wholesale operations, will be onstage during Pre-Owned Con’s general session, “Revolutionizing the Retail Customer Experience,” on Monday afternoon.
5. Improving the auction experience
The National Auto Auction Association has plenty to discuss during the UCW ’17 Second Block. With recent advances such as ACV Auctions, a live-auction mobile app (coincidentally, UCW ’17’s mobile app sponsor), paving a path to evermore simplified and transparent transactions for dealers, buyers and consumers, the auction scene is experiencing something of a latter-day growth spurt.
While disruptors like ACV might lead to an auctioneer renaissance, the physical auction block still occupies a spot in the future. However, moving forward, concerns about safety must be addressed, as the fatal May crash at a Massachusetts auction showed.
Plenty of sessions during the NRC/NAAA Second Block will bring up these topics. Most obviously, Thursday morning’s “Auto Auction of Tomorrow: Planning for changing times” with futurist Thomas Frey and renowned analyst Glenn Mercer will tackle these changes. Also, you might want to peek in to “Safety in the Open Lane: The path forward” with KAR Auction Services chairman and chief executive officer Jim Hallett later on Thursday morning, as well as “Blockchain on the Auction Block” the previous evening with IBM’s Linda Perry-Lube. Also, if you’re around for First Block, ACV Auctions’ Mike Waterman, senior vice president of sales, will deliver a Pre-Owned Con session entitled “The Tech Revolution: Increase wholesale efficiency” on Monday afternoon.
6. Renegotiating NAFTA (or not?)
Love him or hate him, everyone can admit one thing about President Donald Trump: He keeps you on your toes. A staunch opponent of the North American Free Trade Agreement since his presidential campaign, Trump has mentioned over and over that he’d like to either renegotiate NAFTA or, pending a fair deal, scrap the trade agreement altogether.
Along with many other industries, the auto industry would feel an enormous impact from NAFTA’s sudden disappearance.
Among other criticisms, AIADA President Cody Lusk stated, “American consumers can’t afford the additional costs that would come with disruptive changes to NAFTA,” adding that though updating NAFTA would be “important, we urge caution in considering the jobs that might be lost and the prices American consumers may incur as the result of changes to key aspects of the agreement.”
Whether Trump holds this promise or not, you’ll hear questions and comments about the industry’s future under any hypothetical changes to NAFTA. UCW’s “The State of the Industry” and the NRC National Panel will likely explore the topic.
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