Hope on the Horizon: CarGurus Q1 2024 Report Reveals Inventory and Demand are Rebounding as Prices Improve
April 08 2024 - 9:00AM
CarGurus (Nasdaq: CARG), the No. 1 visited digital auto platform
for shopping, buying, and selling new and used vehicles1, today
released its Quarterly Review for Q1 2024, giving buyers, sellers,
and dealers a view into the key trends influencing pricing,
inventory, and demand for new and used vehicles so far this year.
“Rebounding inventory and moderating prices are fueling pent-up
demand in spite of high interest rates. Our research shows sales
for both new and used vehicles are, so far, outpacing last year’s
levels,” said Kevin Roberts, Director of Industry Insights &
Analytics at CarGurus. “While it’s still challenging to find that
elusive affordable car, there’s hope for additional price declines
as prices normalize closer to inflation-adjusted levels. We won’t
see a return to pre-COVID pricing, but data indicates there is room
for average prices to decline by about 14% for used models and 7%
for new, with the potential to drive further consumer demand.”
While car prices are moderating, the report finds that the
challenge of finding an affordable vehicle persists. Data shows
that the number of new cars priced under $20,000 fell by 95% since
March 2020, and the number of used cars under $10,000 is down 46%
over the same period.
Consumers are undeterred, though, and are using tools like
CarGurus.com to uncover more affordable options—with searches for
used cars under $10,000 up 20.5% year-over-year on the site, and
new car searches under $30,000 up 33.3%. This reflects findings
from CarGurus’ recently released Consumer Insights Report, in which
shoppers reported that budget and expected costs are among the top
factors influencing what to buy, increasing from the prior
year.
Additional highlights from the Q1 report include:
- Buyers searching for an
upgrade benefit from a large selection: Not all buyers
were on the hunt for more affordable vehicles in Q1. New car
searches over $50,000 increased by 13.4% year-over-year, reflecting
a dichotomy in consumer demand. Unlike inventory trends for more
affordable options, shoppers in this segment have access to a 133%
increase in inventory compared to Q1 2020.
- Inventory is improving, but
finding late model year used vehicles is getting harder:
New car availability has rebounded by 270% from the low point of
November 2021. However, the hangover of the semiconductor shortage
is lingering for used vehicles. There has been a 19% decrease in
used inventory under two years old compared to Q1 2020, and a 10%
decline in vehicles between three and four years old. On the other
hand, inventory aged five years or older is up 19%.
- Consumer interest in green
vehicles is on the rise: Shopper search activity indicates
a growing interest in electric vehicles (EVs) and hybrids. The
percentage of combined views for hybrids and EVs as a share of
total views for new vehicles increased by 7.4% year-over-year.
Views of used hybrids and EVs increased by 28.8% over the same
period, with recent price cuts on used EVs likely contributing to
the boost in interest.
- Interest in more unique
models – like the Tesla Cybertruck – is increasing: While
Tesla continues to dominate the list of top viewed EV models, the
Cybertruck has generated a whole new wave of buzz after the first
resales entered the market in Q1 2024 - garnering 17x more views as
a ratio to inventory compared to other used Tesla models in March
alone.
“Looking ahead, the future of interest
rates and new inventory production will play a key role in
influencing demand for the rest of the year,” added Roberts. “Time
will tell how much longer shoppers will tolerate a high rate
environment. And questions remain on whether current new
inventory—which is about three-quarters of the way back to
pre-COVID levels—will end up at a peak, or a plateau, as automakers
have been vocal about avoiding a return to a high inventory
environment.”
The complete CarGurus Quarterly Review
- Q1 2024 is available here.
About CarGurus,
Inc.CarGurus (Nasdaq: CARG) is a multinational, online
automotive platform for buying and selling vehicles that is
building upon its industry-leading listings marketplace with both
digital retail solutions and the CarOffer online wholesale
platform. The CarGurus platform gives consumers the confidence to
purchase and/or sell a vehicle either online or in-person, and it
gives dealerships the power to accurately price, effectively
market, instantly acquire, and quickly sell vehicles, all with a
nationwide reach. The company uses proprietary technology, search
algorithms, and data analytics to bring trust, transparency, and
competitive pricing to the automotive shopping experience. CarGurus
is the most visited automotive shopping site in the U.S. 1
CarGurus also operates online marketplaces under the CarGurus
brand in Canada and the U.K. In the U.S. and the U.K., CarGurus
also operates the Autolist and PistonHeads online marketplaces,
respectively, as independent brands.
To learn more about CarGurus, visit www.cargurus.com, and for
more information about CarOffer, visit www.caroffer.com.
CarGurus® is a registered trademark of CarGurus, Inc., and
CarOffer® is a registered trademark of CarOffer, LLC. All other
product names, trademarks and registered trademarks are the
property of their respective owners.
1Similarweb: Traffic Insights, Q4 2023, U.S.
Media Contact:Maggie MeluzioDirector, Public
Relations & External Communicationspr@cargurus.com
Investor Contact:Kirndeep SinghVice President,
Head of Investor Relationsinvestors@cargurus.com
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