Used Car Market

Low Inventory Leads to Competitive Used Car Market

Showrooms across the country are beginning to reopen, but it’s clear the automotive market is still feeling the effects of COVID-19. Dealerships are quickly adjusting to this “new norm”, with many conducting the car buying process in a totally virtual setting.

 

And now, many dealerships are running low on new vehicle inventory. Most automotive manufacturers in the U.S. have been shut down since March, and they’re only just starting to slowly pick up again. There are still shortages on parts and limits on operating capacity, so it’s likely that new car inventories won’t be replenished until November.

 

With fewer new cars available to buy, the used car market is more competitive than ever, and prices on used vehicles will likely increase. Here’s how your dealership can capitalize on the competitive pre-owned market – by offering Vehicle Service Contracts and lifetime warranties to consumers!

 

High Mileage VSC

Increase your dealership’s profitability by offering High Mileage Vehicle Service Contracts. This program is ideal for pre-owned vehicles, because it gives you the opportunity to offer an extended service contract for “high-risk” cars with more mileage. A consumer may be worried about the reliability of a used car with higher mileage, so give them peace of mind with a Vehicle Service Contract.

 

Lifetime Warranties

Because pre-owned vehicles tend to have a shorter lifespan than new, a lifetime warranty on a used car can be extremely profitable for your dealership. Our Drive Forever® Limited Lifetime Powertrain protection includes roadside assistance and nationwide coverage. When marketing this warranty to the consumer, be sure to emphasize that coverage begins as soon as the buyer drives off the lot – so the consumer is confident in its value and is assured that a lifetime warranty is worth it.

 

Certification Programs

Put your dealership ahead of the competition with a Certified Used Program. Our certification program allows you to certify your entire pre-owned inventory, making those used vehicles more attractive to potential buyers. A certified pre-owned vehicle may be the next-best option for consumers who originally wanted to buy new, as it minimizes risk and allows for extra peace of mind. A certified pre-owned car (CPO) includes roadside assistance, limited powertrain coverage for 100,000 miles (12 months), 138 point inspection (84 months), and more.

 

With low inventory on new cars, many consumers will likely turn to pre-owned vehicles instead – and your dealership must be prepared to properly market F&I for those used cars. By offering lifetime warranties and Vehicle Service Contracts, you can turn a one-time purchase into a lasting relationship with a loyal customer.

 

If you’re interested in F&I Training Programs or Products, get in touch with Empire Dealer Services today!

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