New Sales Opportunities for Auto Dealers in 2021

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New Sales Opportunities for Auto Dealers in 2021 Projected Changes in 2021 Following this year's unpredictable and unprecedented disruptions, automotive production was severely impacted around the globe. As of November, IHS Markit projects North American light vehicle production to decrease by 20.2% year over year. However, production levels are expected to increase over the next four years. Auto sales have also been impacted but are recovering at a rate exceeding analysts' expectations. Projections are currently optimistic for 2021, with auto sales and financing largely rebounding through the summer and into the fall. IHS Markit projects 2020 new vehicle sales to decline 17.5% year over year but climb by 9% in 2021. However, this doesn't mean next year is guaranteed success. While light vehicle production is expected to rebound next year, inventory across the country will continue to be limited. This puts the pressure on dealers to balance variable sales and fixed ops by both acquiring in-demand vehicles to build a profitable inventory and capturing a greater share of their market to move the vehicles they already have in stock. Changes to Consumer Buying Behaviors Consumer interest in pre-owned vehicles has remained consistently strong, with the industry's used-to-new ratio averaging about 3-to-1 for most of the year, according to data from IHS Markit. But dealers need to move quickly to take advantage of the trend. With global interest in pre-owned vehicles piqued – and prices on those vehicles at an all-time high – it's critical dealers leverage With the end of 2020 quickly approaching, dealers are wondering what their next "new normal" will look like in 2021. Changes in how shoppers buy vehicles is challenging dealers to evolve both their strategies and their expectations in a very quick time frame. Continuing to adapt to new buying behaviors by understanding the buying experiences consumers have come to expect will be the key to dealership success in 2021. But why wait? Dealers can start this process now by taking a proactive approach and planning ahead of the holiday season. TOTAL NEW VEHICLE DELIVERIES AREN'T PROJECTED TO REACH 16-MILLION UNITS LEVEL IHS MARKIT, OCTOBER 2020 UNTIL 2022

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