Industry Analysis & Industry Trends
As a result of the recession that began in late 2008 and lasted through 2009, consumers facing unemployment and limited disposable income avoided large discretionary purchases, such as cars. Consequently, revenue for the Used Car Dealers industry fell an estimated 1.9% and 4.3% in 2008 and 2009, respectively. Beginning in 2010, however, the economy began to improve, and consumer spending began to rise again. Moreover, consumers, still wary of the economic climate, increasingly opted to purchase used vehicles over new ones, helping to boost sales. The average price of a used vehicle is less than $13,000, while new vehicles can cost between $20,000 and $30,000... purchase to read more
Industry Report - Starting a New Business Chapter
Barriers to entry in the Used Car Dealers industry are moderate. Barriers include high competition levels and start-up costs. The industry is highly fragmented, with no company holding a significant market share of more than 5.0%. This low concentration leads to high competition that is often based on price and can make it difficult for new entrants to generate a high profit margin.
Dealers entering the industry face significant capital costs; industry operators must make large, up-front investments in inventory purchases and dealership lots. New entrants also need to be aware of the appropriate value and demand for used vehicles to avoid holding obsolete inventory... purchase to read more