For those contemplating a pre-owned LS purchase
01-23-17, 09:10 AM
#1
Lexus Test Driver
Thread Starter
For those contemplating a pre-owned LS purchase
I posted this in the general Car Chat here in CL, and have made a mention of this several times in my replies to those looking for a pre-owned LS...but 2017 (and probably 2018) would be great times to buy a pre-owned vehicle.
http://www.msn.com/en-us/money/compa...aPp?li=BBnbfcL
Some snippets
- new car sale volumes have increased year on year for 7 years in a row now (this hasn't happened since the Model T got launched)
- Automakers have heavily depended on leases (BMW/MB up to 70% of their retail deliveries are leases) due to low interest rates and decent used-car values. Look at new car volumes in 2014, as a big proportion of those are getting turned in this year!
- Hertz CEO replaced due to falling resale values of Hertz' main asset, their vehicle fleet
All in all, automakers and finance companies will struggle to sell new vehicles while a significant amount of incoming lease returns will flood the market. Basic principles of economics state supply meets demand; in this case supply will overwhelm demand so when a dealer has 30 E-classes under 36k miles instead of 10, their values will commensurate with the inventory.
Those seeking a 2013-2014 LS (like me) this is a great time to look for one. I probably will wait till the LS500's get in before seriously considering, as that will cause more pricing pressure.
And not to ignore the obvious; this means the trade in values of your vehicles will also drop with the market of course...
http://www.msn.com/en-us/money/compa...aPp?li=BBnbfcL
Some snippets
- new car sale volumes have increased year on year for 7 years in a row now (this hasn't happened since the Model T got launched)
- Automakers have heavily depended on leases (BMW/MB up to 70% of their retail deliveries are leases) due to low interest rates and decent used-car values. Look at new car volumes in 2014, as a big proportion of those are getting turned in this year!
- Hertz CEO replaced due to falling resale values of Hertz' main asset, their vehicle fleet
All in all, automakers and finance companies will struggle to sell new vehicles while a significant amount of incoming lease returns will flood the market. Basic principles of economics state supply meets demand; in this case supply will overwhelm demand so when a dealer has 30 E-classes under 36k miles instead of 10, their values will commensurate with the inventory.
Those seeking a 2013-2014 LS (like me) this is a great time to look for one. I probably will wait till the LS500's get in before seriously considering, as that will cause more pricing pressure.
And not to ignore the obvious; this means the trade in values of your vehicles will also drop with the market of course...
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2KHarrier (01-23-17)
01-23-17, 10:03 AM
#2
I agree this is how it should work. But economics have been turned on their heads over the last 8 years. Trillions of dollars of printed have flooded the US economy and the chickens haven't come home to roost yet (inflation). I'm less optimistic that you regarding new/used car bargains.
01-23-17, 10:13 AM
#3
Thanks Wandl for sharing the info. It makes sense.
However my thought specifically on LS used cars is bit different. Based on my readings, my understanding is LS500 to be released only in one wheel base, that too long wheel base. In fact it will be 1 inch longer than current L base.
In todays LS used car market, I do find more non L than L, probably 80/20. That shows original owners did prefer short wheel base for various reason probably including base price.
That means new LS500 base price will be in the range of 95k. With that price and being long wheel base I am not sure how many new cars buys would end up buying LS500. So, I assume that would create a demand for short wheel base cars especially for post 2013 models. I could completely be wrong, time will tell ...........!
However my thought specifically on LS used cars is bit different. Based on my readings, my understanding is LS500 to be released only in one wheel base, that too long wheel base. In fact it will be 1 inch longer than current L base.
In todays LS used car market, I do find more non L than L, probably 80/20. That shows original owners did prefer short wheel base for various reason probably including base price.
That means new LS500 base price will be in the range of 95k. With that price and being long wheel base I am not sure how many new cars buys would end up buying LS500. So, I assume that would create a demand for short wheel base cars especially for post 2013 models. I could completely be wrong, time will tell ...........!
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