While the market is still strong for quality vehicles with good miles, demand is spotty enough that those vehicles that fit into the category of ordinary are very difficult to trade properly or buy cheaply enough to turn into a profit. Trade-ins are generally scarce as new vehicle sales have dipped and many consumers are returning leased vehicles. Were this lack of supply coupled with strong retail sales, we would be enjoying a market that is deep as well as strong. But the fact is, retail sales have not been great and many of those vehicles that were bought in January and February in anticipation of a strong spring market are still sitting on dealers’ lots. Consequently, the market is quite shallow and only the unusual vehicle is being chased and bringing a premium. Caution is the order of the day when dealing with vehicles that are a bit high on miles or edgy. As is normal in this kind of shallow market, the difference between the exceptional vehicle and the ordinary one is exaggerated.

Particularly hard hit, as usual, are those vehicles - mostly 1999 lease terminations or 2001 program cars - coming back into the market in large numbers. Jeep Grand Cherokee Limiteds
and Ford Explorers are examples of SUVs that have softened significantly. Even some of those imports that seem to be immune to dips in the market - Accords and Camrys for instance – are getting a glimpse of how the other half lives as the high volume of vehicles they need to remarket is eroding their value at an accelerated pace. If a manufacturer does not offer a program to support those vehicles being remarketed in large quantities, pricing suffers. From a consumer’s standpoint, there are some excellent values available in used vehicles.

With the exception of high volume rentals, most convertibles and sport-coupes remain strong. The value of BMW 3-series convertibles, in particular 2000 and 2001 model years, borders on the ridiculous. Mercedes SL series have rebounded from their mid-winter doldrums and are once again a hot item. Corvettes, Mustang GTs, Camaros and Firebirds continue to sell well if not spectacularly.

Pick-ups and Vans seem to have softened generally and where once just about any pick-up was special because of an overall lack of supply, that is no longer the case. Unless they are unusual by virtue of mileage, condition, or equipment, they suffer from the same market indifference as everything else. Of course Honda Odysseys continue to be the exception.

We don’t expect the supply and demand situation to change in the near future, which means that the current market conditions should continue for a while.