Economic Twists and Turns

Market Mood Swings

• Recession Rumblings: The Conference Board whispers of a mild recession around the new year among dipping consumer confidence and geopolitical unrest.
• Retail Sales: Motor vehicles and parts are up 3.3% YOY, while gas stations, furniture/home furnishings, electronics, and appliance stores are struggling the most.

UBS Group AG's Crystal Ball

• Interest Rate Rollercoaster: UBS predicts a whopping 275 basis-point cut next year, outpacing market expectations.
• Recession Red Flags: UBS eyes a mid-2024 recession, nudging the Fed to ease up on rates.

Used Cars in the Retail Spotlight

• October Tales: A minor dip to 1.57 million in sales volume, but hey, it's only a 0.4% drop from September.
• CPO Dips: Sales declined 10% in October.

Inventory Insights

• New Cars: November kicks off with 2.4M units, and days' supply hitting 67. Trucks are aplenty, but crossovers and sedans play hard to get.
• Used Cars: A 4% inventory dip from last year. November starts with a steady 49-day supply, with the under $10,000 gang tighter on stock.

Retail Price Trends

• New Car Bargains: Average prices in October were down 1.4% from last year. A 3.5% year-to-date drop spells good news for buyers.
• Used Car Deals: Prices dipped to $26,533 in November, shedding 3% since 2022.

Wholesale Findings

• Index Insights: A dip in wholesale prices after September, with dealers paying 3.3% less than last year.
• Segment Stories: Pickups inch up 0.4% in early October, but other sectors see price drops. Expect used car prices to stay lofty.
• Correction Course: Post-strike, the market is correcting itself, especially in Trucks and SUVs. Car segments decreased by 1.13%, and Trucks by 1.73%. Days-to-Turn hovers around 50 days.
• Dealer Playbook: Despite a deceleration in valuations, savvy players can spot silver linings. The secret? The gap between car ownership costs and selling prices is widening in favor of the sellers. How? Retail prices are dropping at a slower pace than wholesale prices – a vital metric for those with skin in the game.