Volume 01, Edition 8 | Dealer Weekly

Good morning,

Welcome to Topmarq Dealer Weekly, your snapshot of industry news and happenings. This edition highlights a stabilizing (maybe) used car market, with a few exceptions. There's also the horror show called Carvana and a love story from Penske Automotive.

Let us know how we're doing. We appreciate your feedback and suggestions.

Cheers!

Market at a Glance

We track CarGurus' used car index most weeks, and the past seven days have seen the smallest increase (since our coverage began) in the average transaction amount, just an $18 boost to $30,806. It adds up to a 1.02% gain over the past month.

Drilling further into the numbers shows that only three brands (as used cars) had at least a two percent growth in transaction dollars (among makes still sold as new). Used Aston Martins and Fiats increased by 2.02% and 2.15%, respectively. And pre-owned Teslas rocketed skyward by 7.32%. Last week, ten brands had a 2% or larger advancement in used car transaction values. Are things finally slowing down? We're not ready to take that bet.

And speaking of that increase in used Teslas pricing, It's a crazy time to be shopping for one. Here's an interesting read from Electrek .

Carvana Owners Say Bye-Bye To Billions

There are bad days, and then there are awful days. Such is the case for the father and son duo (Ernie Garcia II and Ernie Garcia III) who control Carvana. They're suffering through a steep drop in the online auto dealer's value. As of this writing, Carvana's stock has plummeted by 25% in the past week. The reason? Crushing Q1 numbers.

Analysts estimated a $1.44 per share loss, but actual results turned into a $2.89 per share ($506 million) decline. The same quarter last year showed an $82 million loss. Revenue figures were better: a 56% year-over-year increase to $3.5 billion (a 14% jump from Q1 of 2021). But at the end of the day, the leap in losses can't keep the market happy.

To put this in perspective, the Garcias have seen their combined fortunes tumble by more than $11 billion since the start of the year. But don't worry, they're still billionaires with 80% voting control of the company.

Penske Reports Record Profits

Perhaps there's something to be said about old-school car selling as Penske Automotive Group reports its best-ever quarterly numbers. The Michigan-based company said it had a first-quarter profit of almost $368 million with $7 billion in total revenue (a 21% increase). Same-store retail automotive revenue increased by 11%, as did same-store gross profit (up 27%).

Penske operates 23 CarShop used vehicle stores, which reported a Q1 increase in retail unit sales by 71% (19,523 units). Total revenue for the unit jumped by 113% to $515 million, including an 89% increase in same-store numbers. Read our blog article on buying a vehicle at CarShop.

Chevy Confirms Corvette EV

There's no such thing as sacred cows anymore, at least when it comes to the auto industry. Chevy recently confirmed that an all-electric Corvette is in the works (possibly for the 2025 model year). There aren't a lot of details, but it's likely the powertrain will share elements from GMC's red-hot Hummer EV. The thought of a 1,000-horsepower Vette is enough to make enthusiasts forget about internal combustion engines.

Dealer Essentials