Dublin, Nov. 16, 2023 (GLOBE NEWSWIRE) — The “US Vehicle Auction Market (by Volume, Type, & Distribution Channel): Insights and Forecast (2023-2028)” report has been added to ResearchAndMarkets.com’s offering.
The value of the US vehicle auction market has increased in recent years due to a variety of factors such as an increase in car collisions, an increase in the average age of cars, and so on. Furthermore, with stagnating earnings and growing living costs, the used automobile industry is projected to thrive in the next years. Car auctions are becoming appealing to both dealerships and private customers around the country as a low-cost way to obtain a vehicle. The US vehicle auction market is expected to reach US$3.23 billion in 2023, growing at a CAGR of 3.41% over the projected period.
By Type: In terms of type, the report provides insights of the US vehicle auction market into two segments: Whole Car and Salvage Vehicle. In terms of value and volume, the whole car held the highest share of the market. Also, the whole car is expected to be the fastest-growing segment in the forecasted period, owing to factors such as the rise in popularity of online car auction sites. Since inventory on an online auction site is available 24/7 and covers a larger geographic area, bidding instances have increased for popular car makes and thus, on an aggregate level, caused their general resale value to increase.
By Distribution Channel: The report further provides the bifurcation of the whole car auction market volume into two segments based on the distribution channel: Online and Physical. The online whole car auction market held the largest share of the market because of the benefits the online channel has offered to both the buyers and the sellers.
Top Impacting Factors
Increasing Vehicle’s Average Life
Rise in Vehicle Crashes
Hike in Revenue Per Car Auctioned Pricing
Strong International Demand
Integration of Online Auction and Artificial Intelligence (AI)
Extensive Use of Data and Analytic Capabilities to Streamline Operation
Change in Consumer Behavior
Driver, Challenge and Trend Analysis
Driver: Increasing Vehicle’s Average Life
As the vehicle gets older, the chances of its various components such as the engine, battery, radiator, front axle, suspension, and brakes to get faulty increases proportionately. Moreover, the older the vehicle, the greater the chance the repair cost exceeds the pre-accident value of the car (when accounting for salvage value). The increased age of vehicles implies a higher probability of them being considered totaled cars by insurance companies. These aged vehicles are among the first choices for purchase by insurers who then sell to dismantlers, rebuilders, and recyclers through auctions provided by vehicle auction service providers. This helps vehicle auction providers to generate higher revenues besides acting as a tailwind to the overall market growth.
Challenge: Fluctuations in the Supply of Used Vehicles
Vehicle auction service providers rely primarily on the supply of used vehicles coming to auction for their respective revenue generation. However, the past global economic downturn and credit crisis led to an erosion of retail demand for new and used vehicles that led many lenders to cut back on originations of new loans and leases. This further led to significant manufacturing capacity reductions by automakers selling vehicles in the US. Capacity reductions could potentially reduce the number of vehicles received at auction in the coming future. This could further result in reduced vehicles from various suppliers. Thereby, impacting auction volumes negatively. Moreover, weak growth in or declining new vehicle sales negatively impacts used vehicle trade-ins to dealers and auction volumes. All these factors could adversely affect the revenues and profitability of vehicle auction service providers in the country. Thus, acting as a roadblock to the growth of the market.
Trend: Integration of Online Auction and Artificial Intelligence (AI)
Artificial Intelligence (AI)-based online auctions are gaining popularity. AI platforms use machine learning and algorithms to deliver clear, easy, and actionable intelligence to bidders. During online auctions, the use of AI helps reduce administrative costs as a number of processes such as internal operations, customer-based service inquiries, and vehicle’s delivery can be automated. The incorporation of AI in online auctions also enables a more efficient way to manage the bidding process. Thus, integrations of online auctions with AI are predicted to contribute to higher participation of dealers in vehicle auctions arranged by vehicle auction service providers backed by a smooth auction experience. This in turn would generate an opportunity for these providers to amplify their profitability. Hence, bolstering the growth of the market.
Analysis of Key Players
The US vehicle auction market is highly consolidated. The key players in the US vehicle auction market covered in the report include:
For more information about this report visit https://www.researchandmarkets.com/r/t05aqw
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