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CarMax Report Reveals Used Car Loyalties

CarMax, the nation’s largest used-car retailer, has more than 240 retail locations throughout the US. On an average year, the company sells more than 800,000 vehicles on the retail market (plus, its wholesale operation sells more than 550,000 vehicles a year), which is enough volume to capture about 14 percent of the American used car market—that’s a massive sample size.

This week, CarMax released its findings on consumer used car market buying trends based on purchases with trade-ins from January 1, 2023, through December 31, 2023. This data was compared to data collected in the 2017 calendar year. Keep in mind that the automotive industry has had a significant upheaval between the studies. “Various factors have contributed to changes in the car-buying experience,” says CarMax, “including economic fluctuations, technological advancements, environmental considerations, trade policies and tariffs, new car brands and models, and significant world events such as the COVID-19 pandemic.”

Nevertheless, CarMax found that one in five customers remain loyal to their brand. While this trend has remained consistent since 2017, loyalty has shifted over the years. “Our most recent data shows Toyota moving from fifth highest brand loyalty rate in 2017 to first, Lexus shifting from the number one spot to third, and Mercedes-Benz holding in second. Ram also skyrockets to fourth after not being on the 2017 list,” reports the company. “In both 2017 and 2023, luxury brands account for more than half of the top ten makes on the list of brands with the highest customer loyalty. The biggest shifts are Infiniti dropping from number nine to 25 on our list, and Tesla ranking in the number five spot. Keep in mind, a broader trend toward electric vehicles and the fact that CarMax began selling Teslas in 2018 explains why Tesla made this year’s list and not the previous one.”

Regarding brand loyalty, the used car retailer found that 19 percent of its shoppers stick to the same brand for replacement, while 81 percent seek something different. Toyota takes the podium for the best brand loyalty (28.5%), with its popular Toyota Prius hybrid being the model with the most loyal owners. Mercedes-Benz (27.9%) is second, with Lexus (27.7%) in third. At the bottom of the list is Dodge (9.8%), with Kia (11.4%) earning only slightly better loyalty.

In terms of body style, the study revealed consumers’ insatiable and growing demand for SUVs—a trend going on for over a decade. Consumers find SUVs more versatile and easier to get in and out of, and the taller ride height provides a more commanding view of the road. “An impressive nearly three out of every four customers who trade in an SUV choose to remain loyal to this vehicle type, highlighting the sustained appeal of SUVs in the automotive market. Moreover, this dominance of SUVs has strengthened since 2017, soaring from 61 to 71 percent in 2023,” states the company. Four-door pickup trucks were in second place in terms of body style loyalty (45.9%).



This article was originally published by a www.forbes.com . Read the Original article here. .

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