George Chamoun, CEO of ACV Auctions, a platform that allows dealers to auction used cars to consumers online, joined Cheddar News to talk about how the red hot used car market has changed throughout the year. "In general, we anticipate used-car value to start declining toward the end of the year into next year," he predicted. Chamoun noted that more new vehicles getting onto lots will be behind the decrease in cost to the consumer.

Closing Bell

ACV Auctions CEO Predicts Used Car Prices to Decline by End of Year

a CV auctions, that's a publicly traded company on the NASDAQ is looking to shift into a new gear as it attempts to amplify its used vehicle transactions and data services platform amid volatility in the sector will supply chain challenges and an unstable economy are creating some rough terrain for the online car marketplace industry. And joining me now to discuss this more at length is George shimon ceo of a CB auctions. George, thanks for coming on the show. I know your company recently reporting a 49% year over year beat on revenue. What drove demand? Yeah, thanks for having us on the show today. I really appreciate it. What's drove demand is, dealers are looking to both buy and sell used vehicles at a significant rate, consumers are looking to buy cars. Um, as you know, there's been less less used cars available, there's been less new cars available. Well, a CVS role is really important. We're the ones helping dealers behind the scenes trade vehicles. So think of it as an auction for dealers. We also help consumers and dealers come up with the right value where a consumer can auction their car to our network of thousands of dealers is a product called live appraisal, But you have to go visit one of our dealer partners and we've got thousands of dealers across the country where consumers can go and find out the value of their car in 20 minutes by auctioning their vehicle. Um, certainly there's a lot of demand out there these days are pretty high prices and the supply chain challenges, not making it any easier or more affordable to get a car. How is your company George navigating the supply chain woes. So the, this macro, the macro issues are really making it very difficult for dealers to price their inventory. Uh, when you, when you really look at the macro concerns, whether it be chip related or other supply issues, it's really drove used car prices up last year to a significant level. Well, when you, when you look at what's going to happen now, we're going to see used car values start to gradually come down and as they gradually come down really, dealers are stuck away. The consumers are stuck with what's the value of my car? ACV provides an instant value in 20 minutes without shipping these cars off to a physical auction, sending them anywhere instantaneously by because of the transparency and trust provide in our digital marketplace, we allow a consumer to know the value of the car and the dealer who may be wholesaling it to remove of this inventory quickly and efficiently. What is your data showing George about the prices for used cars ahead? Do you anticipate that price gains will increase and to what extent we may see certain makes and models increase. Used cars, like there might have been a small pickup truck increase, for example, but in general, we anticipate used car values to start to decline towards the end of this year, Going into next year. And when you, when you think about why that makes sense. one there has been some new cars are starting to show up in new car dealers lots. So the more new cars that show up, we will see Used car values go down. # two, there has been a slight slowdown in consumers buying both the combination of new and use. So because of that, we should start to see used car values start to go down towards the end of this year. All right, George Simmons Ceo of a CV auctions George thanks so much for coming on the show.