As CNW Market Research reports, “Independent dealers have been taking it on the chin for the past few months, seeing volumes decline vs. 2013 on a regular basis, often in double digit declines. November, however, was a turnaround month for Indies with sales up slightly vs. a year ago and transaction prices bulking up. This month vs. a year ago, Independent actual transaction prices (excluding taxes, fees, add-ons) rose 2.8 percent.”

Used car sale prices are increasing at independent used car dealers (those dealerships not affiliated with a new car dealership) at a time when used car prices are dropping. It’s good to see independent dealers doing well again.

Used car dealers associated with new car franchises are also continuing to do well, according to CNW. It says, “New-car dealership used-car operations were on the positive side of sales and should see a near two percent increase for the full month to 1.226 million units. Prices also were up slightly vs. a year ago by 1.2 percent (again, excluding taxes, fees and add-ons).” It would be interesting to know how much those add-ons increased. That would be things like certified warranties and dealership services.

Further analysis by CNW shows, “Prices for used vehicles remarketed by manufacturers were down 11.3% month-over- month and 8.6% year-over-year, as manufacturers sold off elevated program vehicle inventories, including recalled units.” That could mean a more rational pricing structure for certified pre-owned vehicles.

But it doesn’t appear to be hurting sales - and is probably helping them. “According to Autodata, sales of certified pre-owned (CPO) vehicles were up 7.5% versus September and 13.8% from the prior year. Strong CPO sales have been particularly useful in absorbing high incoming lease volumes,” the CNW analysis said.

One concern for consumers, though, should be the increase in sub-prime loans. CNW reports a loosening of credit for new car buyers but that has to be trickling down to the used car market as well.

It’s also interesting to look at consumer confidence. That drives new car sales, which then drives used car sales. To best explain it, lets look at the analogy of why most members of Congress get re-elected. In general, people hate Congress, but like their local representatives.

Well, buyers are convinced the economy is still tanking. Yet, their particular economic picture isn’t looking too bad. As CNW explains it, “Even though CNW’s measurement of consumer confidence in the overall U.S. economy has been slipping every 10-day period since the first week of September, people’s “home-centric” concerns are easing.”

Its research continues, “Contradictory? Not really. Consumers look at two distinctly different economic pictures: Their own and their ‘neighbors.’ CNW Studies have shown an attitude exists that says ‘I’m doing OK, but from all I read and hear, the country’s going to hell in a hand basket.’ New car purchases are made on Home-Centric considerations or ‘Jitters.’ And for November, the attitude is that things are getting better for ‘me and mine.’

“Compared to a year ago, Jitters are down by more than 10 percent. Even compared to a month ago, the measurement shows a decline of more than two percent.”

That could help explain why, CNW says, “for the entire industry, floor traffic continued to slide

somewhat in the first two 10-day periods of November, but continued to hover in the 100 range (1986 = 100). The opening days of the third 10-day period, however, showed an improvement. Days’ supply slipped around 5.6 percent on dealer-induced tighter inventory.”

That’s an interesting phrase: “dealer-induced tighter inventory.” That means dealers still aren’t convinced of the economic turnaround and are being more cautious in their buying habits. After all, it’s expensive to have used cars sitting on the lot that aren’t sold. That’s dealership money that’s tied up in expensive short-term loans.

The only segment of the used car marketplace not doing well is casual sales, or basically consumer-to-consumer sales. In my experience that means a couple things: more people are trading in used cars instead of selling them for the convenience and credit might still be difficult for consumers to obtain who are not working with dealerships and their more readily available sources of financing. CNW says, “Casual sales … saw a rare year-over-year decline of 2.3 percent, cutting its full-year increase to less than 3 percent.”