Why lower used-car prices hurt the new-car recovery a bit, according to Forbes.
Used-car prices are declining – not alarmingly; they’re heading back towards normal, really – but that’s letting some air out of the recovery in new-car sales and car company profits.
That’s important for the auto manufacturers because unusually high used-car prices have been a tail wind in several ways.
High used-car prices mean the car companies and their captive finance companies lose less money – they may actually even make a profit – on cars and trucks coming back from leases.
