The National Automobile Dealers Association Convention & Expo recently released survey results which indicate that car dealers are optimistic about used car sales in 2013.  In the survey, done by Ally Financial and KeyBanc Capital Markets, 47 percent of responding dealers said that their used vehicle department will be the most profitable arm of the dealership.  In addition, 72 percent of dealer respondents expected used vehicle sales to rise in comparison to 2012.  Not only are dealers expecting used car sales to beat last year’s numbers, they are also expecting gross profit on the used models to be strong.

Dealers indicate that there are two factors which make them believe 2013 will be a strong year for the used car market.  The first is that consumer confidence is growing.  According to Tim Russi, president of auto finance for Ally Financial, “We expect 2013 to be a strong year for the auto industry as the economy and consumer credit profiles steadily improve and as new models attract customers to showrooms.”  The age of vehicles on the road, incentives, and new inventory are also expected to  drive consumers into dealerships.

The second factor which dealers think will help drive used car sales is the financing environment.  Banks and lenders have eased up on lending restrictions, which allow many more people to qualify for used car loans.  According to one KeyBank executive, “More than half of our survey respondents (57 percent) indicated that banks and finance companies remained more aggressive in January versus a year ago and 71 percent of respondents indicated a loosening subprime financing environment in the month.”

Ally’s survey found that dealers remain optimistic about a continued increase in overall auto sales, with the used car department being the most profitable.  Over 60 percent of those surveyed said they expected their sales to grow by more than 10 percent this year.  For more information on applying for auto financing, click here.