The auto industry may consider this a good problem to have, but F&I managers are going to be the ones delivering the bad news to customers that they can't automatically expect the sweet incentive deals offered before the recession.
Lower new-vehicle production and higher used-car prices are big-picture factors supporting higher new-car prices. Kevin Bartolo, general manager of Scarsdale (N.Y.) Ford, said recently that his dealership may be one of 500 bidders at an auction for 200 cars. “Two years ago, it was 200 buyers and 500 cars,” Bartolo said.
If used-car prices start to approach new-car prices, that could support higher new-vehicle prices and/or lower new-vehicle incentives. Customers who come in for the first time in four years are in for sticker shock -- that is, a sticker that means what it says.