Grace Hamulic

In October 2011, more than one-half (53.6%) of all new-vehicle deals included a trade-in, up from 49.9% of deals in October 2010, according to Power Information Network® (PIN) retail transaction data from J.D. Power and Associates. It’s noteworthy that during the past year, PIN data indicates that the percentage of trades with negative equity (amount owed on trade-in that is greater than the vehicle’s value) continued to drop. About 22.5% of trade-ins were upside down in October, which was down from 23.2% in the same month a year ago. The new-vehicle sales outcome in October was brighter this year than a year ago.

A few more highlights gleaned from PIN retail transaction data in October this year vs. the same month in 2010 are summarized:

• It’s likely that more buyers and lessees replaced their current older vehicles in October 2011, since the average age of a trade-in from all nameplates rose to 6.5 years from an average trade-in vehicle age of 6.4 years in October 2010. The trade-in vehicle age does not appear to have changed much.

• Interestingly, the age of luxury vehicle trades in October 2011 was younger than the industry overall—averaging 5.3 years old vs. 6.5 for the industry. Continue reading ›