For years experts have warned that a wave of off-lease vehicles returning to market in 2016-18 could send used-vehicle prices plummeting. In recent weeks, Wall Street analysts and business reporters have picked up on the theme, saying collapsing used-vehicle prices could end the streaks of rising sales for used and new vehicles.
But so far, the auto industry has taken the off-lease glut in stride. Used prices have softened only slightly.
Instead, the threat is from a different glut: rising inventories of new cars and trucks.
In fact, the cause and effect is playing out in reverse: Excess new-vehicle volumes -- and rising incentives automakers are throwing at the problem -- are having a more negative effect on used-vehicle pricing. That's according to Cox Automotive Chief Economist Tom Webb.