Description

This report provides comprehensive and current information and analysis of the CPO and used vehicles market including CPO and used vehicles market size, anticipated market forecast, relevant market segmentation, and industry trends for the CPO and used vehicles market in the US.

Current market statistics and landscape

While economic influences (e.g. inflation, declining DPI) and barriers related to the affordability and availability of new vehicles impact consumers’ consideration, CPO/used vehicles have had an increase in demand. As a result, used vehicles have witnessed an increase in pricing, leaving consumers with difficult decisions and likely driving them to be more critical of these vehicles.

Additionally, more than half (58%) of consumers who are planning to buy a vehicle within the next three years have heard of CPO with 41% knowing a little about it and only 17% having heard a lot about it – indicating a critical need for education across consumer segments to drive interest in this offering. Moving forward, brands and retailers must look to guide consumers throughout the process and provide as much information as possible on CPO vehicles, while also offering financing options to address buyers’ economic limitations.

Market share and key industry trends

  • Over a quarter (28%) of consumers planning to buy a vehicle in the next three years are considering a used car for their next vehicle; 17% are considering CPO vehicles.
  • Younger consumers indicate the greatest consideration of used and CPO offerings – 41% of Gen Z and 33% of Millennials are considering used vehicles; 19% of Gen Z and 21% of Millennials are considering CPO – the highest among generations.
  • Nearly a third (31%) of consumers expect to pay $25K-39.9K for their next vehicle – the most popular expectation among consumers; Gen Z consumers expect to pay the least, as roughly (66%) expect to pay less than $24.9K.

Future market trends in CPO and used vehicles

Online marketplaces have been a driving force in consumers’ interest in used/CPO vehicles. This is largely tied to these platforms’ perceived benefits of competitive pricing, extensive inventories, convenience and transparency. As these platforms become increasingly popular, traditional brands and retailers must adapt their sales process to best appeal to consumers’ changing shopping preferences.

Read on to discover more about the CPO and used vehicles consumer market, read our US DIY Auto Maintenance Market Report, or take a look at our other Automotive research reports. Readers of this Report may also be interested in Mintel’s Car Purchasing Process – US, 2022, Shopping for a Car Online – US, 2022, Perceptions of Car Types – US, 2022 and Perceptions of Auto Brands – US, 2022.

Quickly understand the CPO and used vehicles market outlook

  • The impact of economic influences on consumer behavior and the used/CPO vehicle market.
  • When consumers intend to buy; how much they intend to spend.
  • Consumers’ consideration of CPO and used vehicles.
  • Familiarity with and understanding of CPO vehicles.
  • Sources of information used.
  • Factors weighed among consumers considering CPO/used vehicles.
  • Attitudes toward CPO and used vehicles.
  • CPO and used vehicles market forecast.

Covered in this CPO and used vehicles market report

Brands include: CarBravo, Carvana, Subaru, Volvo, Kelley Blue Book, Cars.com, CARFAX, CarGurus, AutoTrader.com, Edmuds.com, TrueCar, AutoNation, National Automobile Dealers Association, CarMax.

Expert analysis from a specialist in the field

This report, written by Gabriel Sanchez, a leading analyst in the Automotive sector, delivers in-depth commentary and analysis of used vehicles market research to highlight current trends and add expert context to the numbers.

Economic influences, coupled with barriers related to the availability and affordability of new vehicles, have driven consumers’ interest in CPO/used vehicles. However, these vehicles have not been immune to rising prices, which has increased skepticism about the condition and pricing of these vehicles, likely further delaying consumers’ consideration and purchasing plans. Moving forward, it will be critical for auto brands and retailers to educate consumers – driving perceptions of value and ultimately confidence.
Gabriel Sanchez, Automotive Analyst
Gabe Sanchez
Automotive Analyst

Table of Contents

  1. Overview

    • What you need to know
    • This Report looks at the following areas
    • Definition
    • Market context
  2. Executive Summary

    • Top takeaways
    • Market overview
      • Figure 1: Total US volume sales and fan chart forecast for used & CPO light vehicles, 2017-27
      • Figure 2: CPO and used industry outlook, 2022-27
    • Opportunities and challenges
    • Educate consumers through in-person and virtual efforts
    • Position “certified” as a “guarantee”
    • Satiate consumers with information
    • Highlight hybrid and electric vehicle inventory
    • Depressed consumer confidence drives consumers away from larger purchases
    • Key consumer insights
    • Consumers most interested in new cars; used and CPO popular among younger consumers
    • Online car marketplaces have drawn interest to used and CPO vehicles
    • Education on CPO offerings needed across consumer segments
    • Consumers weigh a variety of factors beyond price
    • Expected spend on next purchase varies by generation
  3. Market Size and Forecast

    • CPO/used sales remain steady as economic and market influences loom
      • Figure 3: Total US volume sales and fan chart forecast for used & CPO light vehicles, 2017-27
      • Figure 4: Total US volume sales and fan chart forecast for used & CPO light vehicles, 2016-27
  4. Market Factors

    • Consumer confidence remains suppressed, fears of a recession continue to loom
      • Figure 5: Consumer Sentiment Index, 2007-22
    • Market conditions have driven price of new and used cars to historic highs
      • Figure 6: Consumer Price Index, new vehicles and used vehicles, 2017-22
    • Gas prices drive consumers to other forms of transportation
      • Figure 7: US gasoline and diesel retail prices, 2007-22
  5. Competitive Strategies and Market Opportunities

    • Sustainability presents opportunity for CPO/used vehicles
    • Position CPO as an entry point to premium offerings
    • Automakers extend reach on used car platforms
      • Figure 8: CarBravo highlights buying convenience
    • Carvana invites franchised dealerships to join its platform, increases inventory
      • Figure 9: Carvana highlights 150-point inspection process
  6. The Car Consumer – Fast Facts

  7. Purchase Time Frame and Type of Purchase

    • Consumers delaying purchasing
      • Figure 10: Purchase time frame, by generation and race and Hispanic origin, 2022
    • Majority of consumers consider new, but are open to used
      • Figure 11: Vehicle purchase consideration, by generation, 2022
      • Figure 12: Vehicle purchase situation, by generation, 2022
    • Weak financial situations drive consumers to used vehicles
      • Figure 13: Subaru highlights lifetime of its vehicles, 2022
      • Figure 14: Vehicle purchase consideration, by financial situation, 2022
  8. Price Expectations

    • Pricing expectations similar across generations, except for Gen Z
      • Figure 15: Carvana highlights affordability for all
      • Figure 16: Consumer pricing expectations for their next vehicle, by generation, 2022
    • Parents plan to spend more
      • Figure 17: Consumer pricing expectations for their next vehicle, by parental status, 2022
    • Hispanics further opportunities for used vehicles
      • Figure 18: Consumer pricing expectations for their next vehicle, by race and Hispanic origin, 2022
  9. Consumer Familiarity with CPO Vehicles

    • Education on CPO vehicles needed across generations
      • Figure 19: Volvo highlights 170-point inspection and warranty
      • Figure 20: Consumer knowledge of CPO programs, by generation, 2022
    • Multicultural consumers require education on CPO vehicles
      • Figure 21: Consumer knowledge of CPO programs, by race and Hispanic origin, 2022
    • Lower-income consumers need convincing when it comes to CPO vehicles
      • Figure 22: Consumer knowledge of CPO programs, by race and Hispanic origin, 2022
  10. Sources of Information

    • Third-party sources lead education across generations
      • Figure 23: Information sources used, by generation, 2022
      • Figure 24: Share of advertising spend, select information sources, year to date, 2022
    • Higher-income consumers research more sources
      • Figure 25: CarMax highlights money back guarantee
      • Figure 26: Information sources used, by household income, 2022
  11. Important Factors When Shopping Used/CPO

    • Consumers consider variety of factors when shopping used/CPO vehicle; women consider more than men
      • Figure 27: Important factors when buying used/CPO, by gender, 2022
    • Gen Z prioritize fewer factors, Millennials look to more
      • Figure 28: Important factors when buying used/CPO, by generation, 2022
    • Price reigns supreme
      • Figure 29: Important factors when buying used/CPO – Rank, 2022
  12. Attitudes toward Used and CPO Vehicles

    • Consumers understand benefits of used/CPO, but need some convincing
      • Figure 30: Attitudes toward used and CPO vehicles – pricing, by generation, 2022
    • Financial situations drive consumer interest
      • Figure 31: Attitudes toward used and CPO vehicles – pricing, by financial situation, 2022
    • Online car shopping drives interest in used and CPO
      • Figure 32: CarMax highlights #carmaxcares
      • Figure 33: Attitudes toward used and CPO vehicles – availability, by generation, 2022
      • Figure 34: Attitudes toward used and CPO vehicles – availability, by race and Hispanic origin, 2022
  13. Appendix – Data Sources and Abbreviations

    • Data sources
    • Sales data
    • Forecast
    • Consumer survey data
    • Marketing creative
    • Abbreviations and terms
    • Abbreviations
    • Terms

About the report

This market report provides in-depth analysis and insight supported by a range of data. At the same time, introductory and top-level content is provided to give you an overview of the issues covered.

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