CarMax’s huge earnings miss could mean trouble ahead for new-car market | Autoblog

“Six months ago if you took a nice car to the auction, it was like piranha,” said Minor, the managing partner of FreemanCarMax made it clear consumers were hit by a triple whammy: Inflation is making cars less affordable, rising interest rates make them tougher to finance and consumer confidence is ebbing.Prices rose for the vehicles that CarMax sold in the quarter, but that came at the expense of volume. Total vehicle sales fell 10% from a year ago — with retail down 6.

No longer assured of getting what they paid for trade-ins at auction, some dealers are redirecting inventory toward their own used-car lots to see if they have better luck getting full price from retail buyers. CarMax, for example, shifted some inventory from wholesale to retail to meet shopper demand for lower-priced vehicles.

Manufacturers are starting to get more of the semiconductors they need to complete vehicles and are slowly boosting production. But supplies are still lean, and automakers are selling everything they can build. As a result, analysts say sales in September — and the third quarter — probably rose.J.D. Power estimates US new-vehicle sales will reach 1.12 million units in September, a 12% increase from a year ago. Power also forecasts that seasonally adjusted annual sales for the month rose to 13.

actually - it's more likely a sign that sanity is returning & consumers no longer feel obliged to pay over MSRP for 2 year old used cars..& CarMax just got caught holding excessively expensive inventory (which they could hardly have avoided other than declining to participate).

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