News from a major player in the U.S. auto industry shows how changes in Japanese supply may still be affecting the market. As the months roll by since the tragic natural disasters in the island nation that changed the equation for major sellers like Toyota and Honda, the facts on the ground continue to become clearer as analysts take a look at actual sales rates, transaction prices and demand/supply ratios for vehicle models, as well as what drives them.
AutoNation, an auto retailer, is based in Ft. Lauderdale, Florida. Early this morning, the company came out with some profit numbers, along with statements from top staffers that reveal more about the Japanese supply issue.
AutoNation has reported a revenue increase for Q2 of 2011: marking quarterly revenue at 3.3 billion dollars, AutoNation cites a year-over-year increase from 3.1 billion dollars, a raise of about 8%. Adjusted net income rose 29% over the same time period.
Considering the factors that moved the chains on sales at AutoNation, executive comments show that part of the high profits were likely driven by big profit margins for desirable Japanese vehicles during a time of high demand and low supply. Specifically, AutoNation staffers indicate that Japanese supply levels for Q2 were about 40% below “planned levels” and that analysts anticipate a better outlook for Q3, with supply going at about 10-15% below planned levels by September. AutoNation execs added that the market is expected to “normalize” later this year.
What this means for U.S. consumers is that we might finally see some relief from both the big sticker prices attached to some Japanese new vehicles, and some of the outrageous price hikes for pre-owned vehicles like the Prius and others that became much more valuable during the time of scarcity where lack of new vehicle sales impacted the pre-owned market.
With better times on the horizon, many who have put off buying a car are now thinking about jumping back into the fray. The key is to know, not just when to buy, but how to buy. Get further reductions on your final vehicle sale price by doing good shopping research and making sure that you get the best financing deal possible for a new or late model car.
