What to expect in auto sales in 2024
With automotive parts being hard to come by, vehicle prices soared in recent years, and we’ve finally started to see decreases in price in 2023. So, what can we expect for next year? Will vehicle prices decrease or increase in 2024? Keep reading to learn about what to expect in auto sales in 2024.
How do we make predictions on auto prices?
Car prices fluctuate due to various factors, which makes them hard to predict. We can’t say for sure whether car prices will increase or decrease, but we can share what we know about the industry and current trends. The four factors below will play a huge role in how automotive pricing is handled this year.
Parts shortage resolution: potential relief for the industry
One of the factors that may contribute to a decrease in car prices in 2024 is the gradual resolution of parts shortages. The automotive industry has faced challenges in the supply chain due to disruptions caused by the global pandemic. As these shortages start to ease, automakers may find themselves in a better position to produce vehicles more efficiently, leading to a potential drop in manufacturing costs. This could translate to lower car prices for consumers.
Oil prices and automaker strategy
The relationship between oil prices and car prices is a delicate balancing act for automakers. On one hand, rising oil prices may incentivize automakers to keep car prices competitive to encourage sales. Higher fuel costs can lead consumers to prioritize fuel efficiency, making fuel-efficient vehicles more attractive. This could result in a strategic move by automakers to maintain or even reduce prices to appeal to cost-conscious consumers.
Inflation: an uphill battle for affordability
While parts shortages and oil prices may hint at a potential drop in car prices, the overarching concern of high inflation poses a significant challenge. Inflation impacts the cost of production, transportation, and raw materials, all of which contribute to the overall manufacturing cost of automobiles. As prices for these elements rise, automakers may face increased expenses, putting upward pressure on the final price tag of cars.
Consumer demand: the main driving force in pricing
The demand for automobiles plays a pivotal role in shaping market dynamics. High demand often empowers automakers to maintain or increase prices, especially if consumers are willing to pay a premium for the latest features and technologies. On the other hand, if demand is subdued, automakers may resort to competitive pricing strategies to stimulate sales.
What can automotive dealerships do to help alleviate pricing concerns?
If you own an automotive dealership, you understand the need to keep prices low for customers while staying on track with inflation and market pressures. The best thing dealerships can do right now is provide transparency with pricing. Online pricing is necessary for drawing in customers and creating trust.
DealerFire inventory: Online inventories for customer ease and satisfaction
Everyone shops online now, even for vehicles. Customers expect fast, user-friendly interfaces on all retail sites, and they want quick access to prices. With a DealerFire website, dealerships can check all the boxes for their customers. Learn more about our products with the links below.