In January, a 2006 model of a Ford Explorer XLT fetched $13,000 to $14,000 in an auction of used cars. Today, the going rate is about $16,500, according to one dealership.
It is this bump-up in value that helped Ford Motor Credit's bottom line Thursday, when its parent, auto maker Ford Motor Co. (F), reported second-quarter results.
Used cars are rising in value as budget-conscious U.S. consumers flock to them amid the economic slump. Also playing a part is a shortage of second-hand cars as more people opt to stick it out longer in their existing cars, instead of turning them in for costlier trade-ups.
But further gains in used-car prices are unlikely in the coming quarters. Ford Credit said Thursday it doesn't expect gains from lease residual values to continue to boost its earnings. Other auto lenders, such as GMAC Inc., which finances General Motors Co. (GM) and Chrysler Group LLC vehicles, will also likely to have such gains level off.
Used-vehicle "values should start to level off about now after their sharp run-off," said Tom Webb, chief economist at Manheim, the largest U.S. wholesale auction company that sells and buys used cars to and from dealers.
Values on used cars matter a great deal to auto-finance lenders, such as Ford Credit and GMAC. This is because, after leases expire, lenders take the vehicles back and sell them at used-car auctions, hoping to make a profit. Falling resale values last year forced lenders - saddled with inventories of thousands of these vehicles as they came off leases or were repossessed from owners unable to keep up with payments - to sell them at a loss.
This year, that pattern changed. Improvements in used-car values significantly contributed to Ford Credit's pretax profit of $646 million in the second quarter. For the year earlier, Ford Credit posted a pre-tax loss of $294 million.
Excluding one-time gains, Ford Motor Co. would have reported a loss of $424 million for the second quarter, showing that Ford Credit's contribution was significant.
Prices on used vehicles rose more than 12% in June from January, according to the Manheim Used Vehicle Value Index.
Lower fuel prices are also helping. Falling used-vehicle prices fueled by $4-a-gallon gasoline and a weakening economy were responsible for substantial red ink in lenders' books last year, forcing them to scale back or eliminate leasing altogether. GMAC took a $1.2 billion impairment charge on its operating lease portfolio last year. Rival Ford Credit took a $2.1 billion write-down in 2008 related to unprofitable lease deals.
"In the last six-seven months, prices on most used cars have probably gone up by $2,000 to $2,500 across the board," said David Roat, sales manager at the Liccardi Ford dealership in Watchung, N.J. "People's buying habits have changed. They are saying, 'Maybe I don't need to spend on a new car in this economy.'"
But those gains may be over now. One factor: Purchases of new autos may pick up with the advent of the government's "cash for clunkers" incentives.
Ford Credit said Thursday it expected earnings from the second half of the year to be lower.
Wednesday, July 29, 2009
Sunday, July 26, 2009
Greg Waitcus, VP Santa Fe Ford
Santa Fe Ford's custom ASP.net inventory is fully integrated with Facebook, Twitter, and many other social networking services. This is another way that Santa Fe Ford is taking extra care to make sure that sharing vehicles and vehicle searches is easy for all of their customers. The site also displays You Tube videos on vehicle details pages and incorporates a user friendly back end tool for the internet manager and other authorized users to update the site.
Randy Holt is the internet manager at Santa Fe Ford and can be seen starring in vehicle videos throughout the website.
"It's great, the Jorn and Price marketing system works flawlessly and is completely automated. Our inventory updates every night on its own and as far as the video goes, I just pop in the unique You Tube number into the back end tool and there it is on the site. The guys behind this system know what it's like to be on the front lines in the car business and it shows."
Randy Holt, Internet Manager, Santa Fe Ford
The rate that Santa Fe's website is converting website visitors into leads is astounding. Christian Jorn, President of Jorn and Price Marketing had this to say.
"We have put an amazing amount of research and development into the creation of our automotive websites. Web analytics data clearly shows that nearly every new visitor is immediately navigating directly to the dealer's new or pre-owned inventory. Our automotive web marketing system has been built for easy customer usability and high search engine rankings. Santa Fe Ford is an amazing example of the power of this system as a Google search for used Dodge Gainesville returns Santa Fe Ford's Dodge inventory on the first page of results, despite Santa Fe Ford being a franchised dealership located in Alachua. They enjoy the same high visibility for searches such as used Toyota Gainesville, used Honda Gainesville, used Nissan Gainesville, and most of the other makes in their pre-owned inventory."
Christian Jorn, President, JP Automotive Marketing
Jorn and Price Automotive Marketing offers effective internet web systems to franchise and independent automotive dealerships across the county. JP's complete automotive web system has been custom built on the powerful ASP.net 3.5 framework and represents a huge leap forward in the retail Automotive Marketing industry. Dealer principals looking to dominate their market in organic search results should contact Jorn and Price Marketing immediately as some areas are already protected by exclusivity agreements.
This article was written by Christian Jorn of Jorn and Price Marketing. Christian can be reached at (866) 319-4745 or through the website at http://JPAutomotiveMarketing.com
Thursday, July 23, 2009
MOSCOW, July 21 (Reuters) - The number of new and used cars sold in Russia plummeted 55 percent in the first half of 2009, and could end up falling 60 percent by the year's end if the state does not act fast, PricewaterhouseCoopers (PwC) said on Tuesday.
Previously forecast to become the largest in Europe this year, the Russian auto market is facing one of the worst years in its history. Its sum value has plunged 62 percent in the first half of this year to $12.8 billion, PwC said.
Heavy job losses and salary cuts have forced many Russians to delay auto purchases, while many banks have refused to give them affordable car loans due to the global credit drought.
'The negative effects of the global automotive crisis have been among the most serious for Russia,' saidStanley ( SXE - news - people ) Root, PwC's automotive analyst in Moscow. 'The development of the market will depend to a large extent on government efforts to revive it.'
The state has tried to boost auto lending by offering to compensate banks for lowering the price of their loans, but many analysts have said the incentives are too meagre to create a turnaround.
The decline in Russian car sales has contrasted with sales in fellow emerging market India, which has been growing for most of this year.
PwC said the 55 percent decline brought total sales to 743,000 cars for the first half of 2009, including 345,000 imported vehicles, 190,000 locally made foreign models, 200,000 Russian models and 8,000 used foreign models.
For the full year, total sales are expected to come to between 1.3 million and 1.6 million vehicles, a decline of between 50 percent and 60 percent on last year, PwC said.
In March Industry Minister Viktor Khristenko became the first senior official to predict a 2009 decline in sales of more than 60 percent, a forecast seen as pessimistic at the time.
But analysts and industry insiders, now including PwC, have gradually made their predictions more gloomy, making a 60 percent drop look more like a baseline scenario for this year.
In earlier data, the Association of European Businesses (AEB) said sales of new cars fell 49 percent in the first half, with Ford, Hyundai, Nissan ( NSANY - news - people ) and Toyota ( TM -news - people ) among the biggest losers.
Kuwait's Ministry of Commerce has stressed upon used vehicle importers to fulfil relevant regulations and decrees, primarily the ban on the import of five-year-old cars and equipment, KUNA has reported. Failure to meet used vehicle import conditions would result in denying cars access to the country and imposing demurrage charges and forced re-exporting, the ministry has said. However, antique vehicles and cars of politicians, diplomats, officials of international organizations and overseas students are exceptions, the ministry noted.
The Saudi automotive market has tended to grow at a far slower rate than neighbouring
The main risk factor comes from the Saudi stock market, where many consumers have invested money.
Having lost more than 57% in 2008, the Saudi bourse was the second-worst performing Gulf Cooperation Council (GCC) market behind Dubai. BMI has observed that slumps in the stock market have a significant impact on consumer confidence, with Saudi nationals delaying purchases of big ticket items such as cars. However, it is our long-held view that it will be the first of the region’s markets to recover.
Consequently, consumer confidence will return quickly as soon as the market regains value.
The Saudi currency peg to the US dollar will mean that, in the near term, cars manufactured in Europe will become cheaper as the US dollar appreciates. Even before the decline of the euro’s value, European producers had strengthened their position on the Saudi market. This trend is likely to continue due to the downward pressure on the euro. It will also reduce inflation throughout the economy, helping to keep the cost of living down and shoring up consumer spending.
BMI estimates that the Saudi automotive market grew 13.5% y-o-y to over 590,000 units, which is lower than the 14.1% forecast in our previous quarterly report, with sales growth negatively impacted by the falls in the stock market. Growth is set to decline to 3.5% in 2009 as the market comes under pressure as a result of a lower economic growth rate and a slowdown in spending. Nevertheless, the rest of the forecast period is set to see annual growth rates averaging 9.6%, reaching over 880,000 units by 2013, a rise of almost 50% over 2008.
Saudi Arabia scores 54.3 points (out of a theoretical maximum of 100) in the BMI Automotive Business Environment Ratings this quarter, down 3.1 points since the previous quarter due to the expected downturn in the automotive market. This puts it 0.3 points ahead of Kuwait and 2.3 points behind South Africa. As a result of the decline in its score, Saudi Arabia’s rank has fallen from third to fourth place.
Aside from the forecast decline in the market, a lack of automotive production and stringent foreignownership laws weigh down Saudi Arabia’s score. On the upside, despite being the largest automotive market in the Gulf, it has the best penetration potential due to a low per-capita rate of vehicle ownership, partly due to the ban on women driving; the introduction of pending legislation allowing women to drive would help raise vehicle ownership significantly. Saudi Arabia’s score will also benefit if it establishes large-scale automotive production facilities.
Tuesday, July 14, 2009
Mainly young people and limited wage earner face difficulty in buying a new car for the reason sky rocketing prices of new cars. So they do not want to use their whole savings to buy just one high priced car. At such circumstances used car loan is best option for purchasing an older car. Because now a days used cars are as attractive as the new ones and so you can get used car loans at very competitive rates as the cars seized from defaulters are as good as new. There are many such used cars to be found that are just a year or two old. These cars possess more or less the same features as a new car. The various types of used car loan which can be found in the market are mentioned below.
Generally there are two types of used car loans one is secured and another is unsecured. In asecured used car loans you can get competitive interest rates. And any type of asset or bank paper containing certain value can be used as collateral for the used vehicle loan amounts. You can use the vehicle itself as collateral for a used vehicle financing. In secured car finance you can borrow up to the amount of equity in collateral.
Another is an unsecured used vehicle loan which is generally targeted for all those who are not willing to place collateral. An unsecured used vehicle loans carry’s no risk to assets since assets are not involved. The factors like your credit score, credit history, financial situation, employment proofs and income proof are taken into consideration when determining the interest rate of a unsecured used vehicle loan. Many lenders offer low interest used car loans. Regardless of your credit history, you can get approved for a low interest automobile loan as the financing based on your qualifications. As the online lenders have thousands of lenders in their network, so that gives you an opportunity to compare lenders deals which will helps you to find the best rates. Thus you can also select terms that give you the most favorable loan financing.
It’s a well known fact, that person with a good credit score is always offered with a great offer and competitive rates. But now a days lender also offer bad credit auto loans with the best rates on used car to individuals with poor credit. Unlike dealerships that offer excessive rates, the online lenders have a reputation for approving loans with fair rates. The objective is not to make profit out off someone’s misfortune, rather to help people to buy their dream car. Pre approved used car loan is one of the best options to get you the best deal on a used car loan by getting your finance deal done before you buy a car. Pre-approved loans gives you the most options on deciding how much you want to borrow and what rates to accept. Thus it gives you an edge when buying a car.
Another concept which is more popular among the auto loans field is refinancing. People end up getting high interest rate when they have bad credit but when their credit gets improved, they still end up paying high rates. At times refinancing used car loans can get car credit at low rate. Refinancing used car loans can immediately put an end to your monetary troubles that come with high interest car loans. Through used car loan refinancing you would able to obtain a new loan, including a lower rate of interest, in place of your current high interest rate loan.
Used car loans are very easy to get online by comparing various car loan quotes. Comparing online car loan quotes facilitate in obtaining the best auto loan in the market. So, don’t wait and go get yourself a used vehicle loan to get you the car of your dreams.
Your new question to yourself should be what type of car you want to buy; a new or used and upto how much value? As this do affect car loan rates. Used car loan rates are generally higher as compared to new car loan rates because if the car loan goes into default lender cannot recover the whole loss from the used car. In short, purchasing a low-priced used car at a higher loan rate can be same as to buying an expensive new car at a lower rate.
Buying a new car is still out of the means of some people, and so used car is a great way for people with limited finance to be able to get a car outright, and thus old car financing have greatly empowered people. Used cars are more economical and therefore many people prefer buying used car which is a smart financial decision. But many a times people find it difficult to finance their old car with financial institution like bank. The reason behind is the declination in the value of car and even if they get loan, they end up paying higher interest rates.
New car registrations in Romania dropped by 59% to below 12,000 units in June this year, while the number of used car registrations almost tripled to over 17,000 during the period, as compared to June 2008, according to official data released on Tuesday.
For used cars, new registrations upped 2.7 times to about 17,700 in June this year, given that June 2008 was one of the weakest months for used car registrations last year.
The 2010 Mitsubishi Galant SE makes its entrance in the Philippine market in the third week of July, loaded with stylish and high-tech features that refines the riding experience in an executive car.
One of the high-tech features is a fully functional Global Positioning Satellite (GPS) Navigation system that can direct you to your selected destination visually through Galant’s 7-inch in-dash monitor located in the center of the dashboard. The system is also capable of providing other helpful information such as streets, major buildings and establishment names, speed limit of certain street, etc.
Another new feature is the keyless entry security system with engine immobilizer. The original set of keys included in the car has a built-in transponder that sends a unique verification code to the ignition switch to protect itself from unauthorized duplicated keys. The remote transmitter can also be used for opening the trunk.
Spirited drivers will appreciate the tiptronic shifter on the steering wheel , which will allow him or her to control the shift lever through the plus and minus keys.
Mitsubishi Motors Philippines (MMPC) President and CEO Masahiko Ueki said: “The intro of the all-new Galant reinforces MMPC’s passenger car line-up and gives us the opportunity to improve further our total passenger car market share.”
This Euro-styled sedan measures 4,885 mm in length, 1,840 mm in width and 1,480 mm in height. Cabin room length is 1,997 mm, translating to more legroom for its passengers.
The front grille features a new design chrome radiator with the striking three-diamond mark. That face is enhanced by the shape of the high intensity discharge (HID) main lamps, which incidentally can be adjusted by the driver to provide a brilliant view of the road during night time driving. On the side, electronically controlled side mirrors (with power folding functions) have been integrated with side turning lamps.
Inside, the new Galant is all about comfort and luxury. Glove-soft black leather seats come with adjustments. The driver’s seat has an eight-way power-adjust with lumbar support; while the passenger seat has a four-way power-adjust.
Powering the Galant SE is a 2.4-liter MIVEC (Mitsubishi Innovative Valve Timing and Electronic Control System) engine. It can adjust the valve timing for optimal performance for all driving conditions. This enables it to produce higher torque at low rpm ranges for quick, clean starts and higher output in the high ranges for better passing ability.
The 4G69 MIVEC engine provides numerous advantages over its predecessors. Throughout its construction, Mitsubishi engineers have found ways to increase efficiency and durability while simultaneously reducing weight and emissions.
The power and efficiency of this 4G69 MIVEC is harnessed by Mitsubishi’s fully advanced and intelligent INVECS-II 4-speed automatic transmission with sportronic feature. This transmission studies the driver’s driving habits under a variety of conditions and uses two shift control programs to determine the best balance of power, control and efficiency.
Smooth ride and stable handling is provided by an all-wheel independent suspension system. McPherson struts with stabilizer bars up front and multi-link with stabilizer bars at the rear assures quick response to the driver’s commands, even when road conditions turn tricky, reducing understeer and improving cornering stability when powering through turns yet providing a refined luxury.
New design 10-spoke 17-inch wheels complemented with 215/55 R17 93V provides excellent grip on the road.
The new luxury sedan is also equipped with a full entertainment system which features an original equipment DVD/CD/MP3 FM & AM band audio system with Dolby Digital 5.1 feature. This Dolby Digital feature of the audio system is complemented by the 12-way speakers with 10-inch subwoofer and a center speaker.
On its safety aspect, the all new Galant SE is equipped with dual stage SRS airbags. A rearview camera plus front and reverse parking sensors makes parking maneuvers effortless and safer.
The 2010 Galant SE, now available in Merlin Black, Excalibur Silver and Nicolei Grey, will have an introductory price of P1,588,000.
Thursday, July 9, 2009
Wednesday, July 1, 2009
SwitchCar.co.uk now provides an RAC inspection on every car. So customers can be sure that one of motoring’s most respected bodies has independently inspected their choice of vehicle.
“We already offer some of the lowest prices around” said Jon Cleaver, General Manager. “By providing an RAC inspection as part of the deal, our customers can rest assured they’re getting great quality too. If the RAC inspector highlights anything to us, we simply rectify the problem or refund the reservation fee in full.”
Customers receive a copy of the RAC report once the car has been reserved and when they come to view and test drive, so they have an expert analysis of the vehicle’s condition at their fingertips.
By doing away with showrooms and commissioned sales staff, SwitchCar.co.uk is able to pass on the savings as a discount across a wide range of previously owned nearly new and used cars. Specialising in a range of manufacturers such as Audi, BMW, Ford, Volkswagen, Vauxhall, Lexus and Mercedes, the company enables car buyers to get more for their money by shopping online.
With over forty photographs of every car on the website, visitors can examine the car in all its detail before reserving it online. After a test drive, buyers are able to drive away the car the same day, safe in the knowledge that they have a complete money back guarantee.
AUDIS now hold more of their value over three years than either BMW or Mercedes, so don't expect to find a recent one with average miles at a bargain price.
There is a bewildering line-up of engines, gearboxes and trim so it's a good idea to do some homework before you look.
Petrol engines in the A4 from 2005 to 2008 ranged from 1.6 100bhp through 1.8 turbo 160bhp, to 2.0, 2.4 and 3.2-litre with around 252bhp.
And turbo diesels go up from a 1.9 with 113bhp through 2.0, 2.5 and 2.7-litre models to a 3.0-litre with 229.
All are very well built and have great driver appeal with good to superb performance across the range. Front space is excellent but legroom is a little tight in the back.
The 1.6 is not particularly quick, but the 1.8's are better and the others better still. All have a long travel clutch in manual form, and many will have the optional tiptronic or multitronic CVT automatic gearboxes, which are both very good.
Seats are fairly firm in the German way, but have excellent adjustment and the steering columns adjust for height and reach.
There's room for four adults and their luggage to travel in comfort, but five is a squeeze and lower order cars lack equipment unless extras have been added.
Audi A4 1.8 T
Price: Pay £7,800 for an '05 54-reg, £10,200 for an '06 06-reg multitronic auto, £12,400 for an '07 57 manual
Mechanical: 160bhp, 1,781cc, 4cyl petrol engine driving front wheels via 5-speed manual gearbox
Max speed: 141mph
0-62mph: 8.3 seconds
Combined mpg: 34
Insurance group: 14
CO2 emissions: 197g/km
Main rival: BMW 3 series, Ford Mondeo
The car sales industry has obviously been affected by the economic downturn and dealerships have had to introduce more discounts than normal in an attempt to boost sales, whilst the Government have introduced the scrappage scheme whereby a car that is 10 years old or more can be scrapped in return for a £2,000 discount off a brand new vehicle.
This has received much criticism from many in the motoring industry but early signs suggest that the scheme could be a relative success. The main criticisms are surrounding the fact that discount is limited to brand new cars as opposed to including year old used cars as well, as they have done in Germany.
The problem is, even with the scrappage discount a brand new car is still an expense that many people cannot afford during these uncertain economic times, so I believe the trick is to buy used, but not too used!
Your best bet is to look for brands that are sought after and therefore easy to sell on in a couple of years time and that depreciate at a slower pace than most, and for that read:used BMW.
Why buy brand new when a used BMW with less than 15,000 miles on the clock can be yours for two thirds of the price? I understand that many people are wary of purchasing a second hand car but with many authorised used BMW dealerships throughout the UK, you can make a purchase with the peace of mind of a warranty and that the vehicle has been fully checked by BMW engineers.
And of course, warranties are passed over so when buying a one year old used BMW that was originally purchased with a three year warranty, you would receive the further two years left on the warranty as the new owner.
With the recession looking to continue to 2010 and beyond, car buyers will be opting for used cars that hold their value and as a result used BMW’s are being snapped up quicker than ever, especially as fewer are out on the m,arket at present as less people are upgrading their vehicles at the current time.
The Government car scrappage scheme is aiming to change that, and for the entry level run around car, it will no doubt prove a success – two grand off a £7,000 car represents a great saving, but for a more prestige car a £2,000 discount will probably not prove a deal breaker.
As the credit crunch continues to bite, figures show an increasing number of drivers are turning to used cars as a way to cut costs.
In fact, BMW's used car programme, BMW Premium Selection (BPS), has grown by 130 per cent in Bahrain alone in the first quarter of 2009 and across the Middle East figures are continuing to rise showing a 59 per cent increase on 2008.
The BPS programme is relatively new at just two-and-a-half-years old and is part of BMW's commitment to quality. The advantage of buying a car from the BPS programme is the owner receives a one year guarantee and the car has to pass the most stringent tests to be part of the programme.
James Crichton, above, sales and marketing director, BMW Group Middle East said: "BMW Premium Selection operates as a sub-brand within BMW Group which must follow set criteria including:
* Vehicles must be less than five years old.
* Mileage under 100,000 km.
* Serviced by authorised BMW importers.
* Vehicles must pass a stringent 75-point technical check by trained BMW technicians before they are accepted into the programme and sold.
"A 12-month service and engine warranty with road side assistance is given to each customer when purchasing a BMW Premium Selection vehicle."
On the effect of the economic climate on used car sales, he added: "Certainly we are seeing consumer attitudes begin to shift in line with the value cycle as many people are keen to make their money work harder.
"Second-hand goods that will see high demand will be those that consumers can easily identify as affordable but also offer a level of quality that justifies the outlay."
However, he added that used sales were not expected to outstrip those of new cars.