For consumers looking to buy a vehicle, Cox Automotive has come out with their 2024 forecast (Cox Automotive’s Forecast: 2024 – A Return to Normalcy in the U.S. Auto Market – Cox Automotive Inc.) which suggest prices could decline this year.
Calling it a “A Return to Normalcy in the U.S. Auto Market,” Cox says 2024 is expected to be the best year for car buyers since the pandemic, for new and wholesale cars.
One of the reasons? More inventory. This would benefit consumers placing a downward pressure on prices with dealers looking to raise incentives and discounting cars to increase. With lower prices for consumers, car dealers may see lower profits and tighter margins, but on the whole may sell more in volume to make up their profits.
Cox didn’t give an exact percentage of a price drop but said prices are expected to decline moderately.
Cox analysts expect a slowdown in the U.S. economy this year. They are predicting that sales in new-vehicle sales are to increase by less than 2% and used vehicles are expected to increase by 1%.
Experts predict a continued rise in repossessions in the used car market, potentially increasing sales in 2024.
ELECTRIC VEHICLE MARKET
Cox believes there will be growth in the EV market this year, with electric vehicles alone accounting for more than 10% of total sales. Some market analysts may differ from that number.
EV dealers around the country are reporting lower sales in 2023, with companies like Ford and GM slowing down production. Even with the tax credits consumers can take advantage of from the Inflation Reduction Act, Florida auto groups say there hasn’t been a demand for EVs.
Cox Automotive says the automobile industry needs to acknowledge they need to do a better job convincing average consumers of the benefits of electric vehicles.
Two sticky areas for consumers looking to buy a car could be the monthly cost ranging from $700-$1,000 and the possibility of higher loan rates still hanging around.
“The expectation is for rates to come down from record highs in the year ahead. Though the downward trend likely won’t be significant, any decline will help improve vehicle affordability and relieve many households struggling financially,” says Cox.
