Crossovers and trucks remain popular with consumers and that has limited their depreciation when they hit the used the market. Thankfully, prices are dropping as Wards Auto reports there is a “tsunami” of off-lease vehicles hitting the market this year.
According to the publication, 3.9 million vehicles will have their leases end in 2018 and many of them are highly sought-after crossovers, trucks and SUVs. This is due to a combination of factors as the United States has experienced years of record vehicles sales and the crossover craze didn’t kick into high gear until a few years ago. Now, it’s a dominate trend as crossovers, trucks and SUVs are outselling traditional cars by nearly two-to-one.
This is bad news for dealers trying to sell brand-new models, but it’s a great opportunity for buyers looking for a deal. As Cox Automotive’s manager of economics and industry insights, Zohaib Rahim, explained “If you can buy a three-year-old CUV that’s $10,000 to $15,000 less than a comparable new CUV, that’s attractive to a lot of shoppers.”
The trend is expected to continue for at least two more years as Rahim says there will be approximately 4.1 million off-lease vehicles hitting the market in 2019 and another 3.9 million in 2020. This is good news for buyers as the average new vehicle loan recently hit a record of $31,455 in the United States. This means consumers are making average monthly loan payments of $523.
Given the rising prices of new vehicles, it’s no surprise that many consumers are looking for more affordable options. This used to mean settling for a car, as there were more on the second-hand market, but the flood of crossovers, trucks and SUVs means consumers now have more choices.
