Overview

Smooth drive: Rising disposable income levels will boost industry sales

IBISWorld’s Used Car Dealers Industry Research Report contains up-to-date data and analysis, allowing you to identify the strengths and potential weaknesses of major companies in the industry. Build your credibility with clients and prospects by sharing insights into the current and emerging trends driving their industry. Our market research gives you the tools to win new business and keep existing clients.

REPORT SNAPSHOT

Market Share of Companies
Industry Statistics & Market Size
Revenue
$124bn
Annual Growth
12-17
4.3%
Annual Growth
17-22
Profit
Employment
273,833
Business
139,501

Industry Threats & Opportunities

  • Positive economic factors, particularly at the consumer level, will boost industry revenue
  • Used car dealers are seeking to broaden in-house financing
  • Consumers with stable employment and income will be more willing and able to purchase vehicles
  • Industry Analysis & Industry Trends

    Used car dealers benefited from offering independent financing solutions over the past five years. When disposable income started to increase early in the five-year period, industry revenue followed suit. Additionally, credit standards loosened and consumer confidence improved in light of stronger economic conditions. Over the next five years, although the industry is expected to benefit from positive economic indicators, particularly at the consumer level, there are potential threats that may inhibit further growth.

    Industry Report - Starting a New Business Chapter

    The Used Car Dealers industry has minimal barriers to entry, with low investment requirements and no franchise agreements. Used car dealers' main barriers to entry are availability of sufficient financing and a suitable store location. Store locations vary widely in quality, with locations in high-traffic areas particularly sought after. Used car dealers require some form of financing, often the owner's equity, to purchase vehicles for sale and finance customers' purchases. Ample financing is a particularly urgent requirement for dealers engaged in “buy here, pay here” (BHPH) financing arrangements, which carry a high risk of default. New entrants to this industry will find that competition from existing used car dealers represents the most significant barrier to entry.

    Additional Insights for the Used Car Dealers Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Used Car Dealers Industry are

  • Provision of superior after-sales service
  • Superior financial and debt management
  • Effective cost controls
  • IBISWorld analysts also discuss how external factors such as Per capita disposable income and Price of new cars in the Used Car Dealers industry impact industry performance..

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    Industry Products

    What is the Used Car Dealers Industry?

    This industry sells used passenger vehicles, including passenger cars, light trucks, sports utility vehicles (SUVs) and passenger vans. Used car dealers also provide financing and insurance services.

    Industry Products
    Used vehicles
    Parts and services
    Financing and insurance
    Industry Activities
    Used automobile
    Used light truck
    Vehicle financing

    Table of Contents

    About this Industry
    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry at a Glance
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Industry Performance
    Executive Summary
    Key External Drivers
  • Per capita disposable income
  • Price of new cars
  • Aggregate household debt
  • Average age of vehicle fleet
  • World price of crude oil

  • Current Performance
  • Rising off a low base
  • Shifting gears
  • Technological advantages
  • Increasing wholesale power
  • Chart: Revenue Growth

  • Industry Outlook
  • Improved economic conditions
  • Preparing for success
  • Looming intervention
  • Table: Used Car Dealers Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Used Car Dealers Industry Lifecycle vs The Economy

  • Products & Markets
    Supply Chains
    Key Buying Industries
  • Consumers

  • Key Selling Industries
  • Auto Mechanics
  • Auto Parts Stores
  • Automobile Wholesaling
  • Car Body Shops
  • Car Wash & Auto Detailing
  • Oil Change Services

  • Products & Services
  • Used vehicles
  • Parts and services
  • Financing and insurance
  • Chart: Used Car Dealers Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Prime customers
  • Subprime customers
  • Nonprime customers
  • Super prime customers
  • Deep subprime customers
  • Chart: Major Market Segmentation for the Used Car Dealers Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Competitive Landscape
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Purchases
  • Wages
  • Rent, utilities and marketing
  • Chart: Cost Structure Benchmarking – Sector vs Used Car Dealers

  • Basis of Competition
  • Internal
  • External

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Used Car Dealers Industry

  • Industry Globalization
    Major Companies
    CarMax Business Services LLC
  • Table: CarMax Business Services LLC - financial performance

  • Operating Conditions
    Capital Intensity
  • Chart: Level of Capital Intensity for the Used Car Dealers Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Key Statistics
    Table: Industry Data for the Used Car Dealers Industry
    Includes:
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Used-vehicle average selling price (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Table: Industry Financial Ratios
    Jargon & Glossary
    Bad Debt Expense
  • Represents the amount of noncollectable accounts receivable that occurs in a given period. This occurs when a customer is unable to fulfill their obligation to pay an outstanding debt.
  • Buy Here, Pay Here (Bhph)
  • A financing option at some dealerships in which customers secure car loans without providing their credit history. As a general rule, a down payment and proof of income are the only items required.
  • Lease Here, Pay Here (Lhph)
  • A financing option at some dealerships in which customers lease a vehicle, but the dealership retains ownership.
  • Why buy this report?

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Used Car Dealers:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Used Car Dealers market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Used Car Dealers, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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