Last week, we told you that a glut of SUVs on used car lots had led to low prices, making this a great time to buy a recent used sport utility or truck, if you have the need. Throughout the weekend, media reports have focused on the other side of that coin.
If you own an SUV, it's probably losing value.
Gas prices rising steadily toward $4 a gallon have driven million of consumers to buy smaller cars this year. When they buy that small or midsize sedan, a tremendous number have used an SUV as a trade-in -- leading to a glut of SUVs sitting on used car dealer lots this spring.
The AP explains, "Used SUV sales in March were down 14 percent nationally compared to last year, according to data compiled by CNW Marketing Research. That follows drops in used SUV sales of more than 8 percent for the first two months of the year, compared to the same months in 2007." The "has sent used SUV prices plummeting, giving owners a shock when they try to trade theirs in and find out how little they can get."
The Orlando Sentinel says "Used-car dealers don't want the big vehicles on their lots anymore because hardly anyone is buying them. Some won't take them at any price."
Guy Lance, sales manager at Admiral Nissan in Pleasantville, New Jersey, told the Press of Atlantic City that he increasingly sees "people trying to trade in SUVs that are less than a year old." Lance added, "Normally, people don't trade out that quickly," but, "Let's admit it, when you go to a gas station and say, 'Just put $90 in my truck,' that's a little hard to swallow."
Dave Eller, general sales manager of Hurley Chrysler Jeep in DeLand Florida, told that state's News-Journal that "some large vehicles are dropping thousands of dollars in value each month. … Anything diesel has dropped $5,000 in the past five months," he added.
Used car dealers facing lots filled with unwanted SUVs are struggling to figure out how to unload them. Many may be going overseas. Sales manager Al Johnson of AutoNation's Maroone Nissan in Pembroke, Florida told the AP that "the dealership had been exporting about one car a month" in recent years, but "this year they average roughly 10."