Over 1 million new cars from the 2024 and 2025 model years are left unsold as we approach 2026, creating a unique opportunity for buyers. The hosts discuss how dealerships are motivated to clear this inventory, often offering significant discounts. They dive into the implications of unsold vehicles, including potential issues like 'lot rot' and the importance of pre-purchase inspections. The episode also covers how warranties work for these unsold cars and offers insights on negotiating better deals as the year-end approaches.
Today on CarEdge Live, Ray and Zach discuss the latest data on leftover new cars. Tune in to learn more! Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com
for information about our collection and use of personal data for
advertising.
"Well, if you're working for Mr. Roger Penske, you're getting an SD email because you're not supposed to have any of last year's model year vehicles left over moving into the new year."
Penske is a company that owns many car dealerships, so when someone talks about them, they’re referring to those stores.
Penske Automotive Group is a large dealership network that sells new and used cars across the United States.
"So as a dealership employee, you're looking at it as I have to do whatever needs to be done to see to it that those vehicles, the remaining 2024s and God knows you shouldn't have any of those."
Cars are grouped by the year they were made, and dealers want to sell older cars before a new model comes out.
Vehicles are labeled by the year they were manufactured; dealers often try to clear out older model years before a new year begins.
"Ford at the beginning of the month had 16,298 leftover 2024. So if I'm a Ford dealer out there and I'm sitting on a leftover 2024 F-150 and we are now five days away from 2026, what am I doing to get rid of that new 2024 F-150 that's still on my lot?"
The F‑150 is a big truck that people use for work and fun. It’s popular because it can haul heavy loads and still feel comfortable inside.
The Ford F‑150 is America’s best‑selling pickup, known for its versatility and strong towing capacity. In the podcast it’s discussed as a leftover inventory issue, highlighting how dealers manage older model year stock in a rapidly changing market.
"To your point, who knows if it's actually two years old, but the two-year model years, I mean, that would have been depreciated as a used car."
Cars lose value quickly after you buy them. Knowing how much a car has dropped in price can help you decide if it’s a good deal.
The reduction in a vehicle’s value over time, especially within the first few years after purchase. Understanding depreciation helps evaluate fair price.
"Just open up the driver's door and on the pillar or at the bottom of the pillar ... will be a manufacturing plate that will list the VIN number and the month and year..."
Inside the car, near where you sit, there’s a little plate that shows when and where the car was made. It helps you know how old the car really is.
A small metal or plastic plate located inside the vehicle, usually near the driver's side pillar, that lists manufacturing details such as VIN, production month and year, and factory code.
"Just open up the driver's door and on the pillar or at the bottom of the pillar ... will be a manufacturing plate that will list the VIN number and the month and year..."
Every car has a special code called the VIN that tells you exactly what make, model, and year it is. It’s like a birth certificate for the vehicle.
The Vehicle Identification Number (VIN) is a unique 17‑character code that identifies a specific car, including its manufacturer, model, and production details.
"And that's a great idea if you're buying especially at 2024 because to your point, it could be well over two years old right now heading into its third birthday post-production."
It means the car was made in 2024, so it has newer features and updates.
The 2024 model year refers to vehicles manufactured in the calendar year 2024, often featuring the latest updates and technology.
"Those dealers will sell those cars. They may not get sold to a retail customer. They may get sold as used cars at the dealer auctions."
Dealer auctions are places where car dealers sell their leftover cars to other people or businesses. It’s a way to get rid of cars that didn’t sell in stores.
Dealer auctions are events where car dealerships sell inventory—often unsold or excess vehicles—to other dealers, wholesalers, or private buyers. Prices can be lower than retail because the cars are sold in bulk or as part of inventory clearance.
"So for those of you that are unfamiliar on the Car Edge Car Search, you can click Make Model or Vin. We've entered a Vin here."
Car Edge Car Search is a website feature where you can look up cars by typing the brand, model, or the car’s unique code (VIN). It helps you find details about a vehicle fast.
Car Edge Car Search is an online tool that allows users to search for vehicles by make, model, or VIN, helping buyers find specific cars and gather information quickly.
"And that will then pull up a vehicle. So here we, oh goodness. We've got a 2023, pull the comments off, 2023 new Ford F-150 Lightning Platinum. Now for those of you that don't remember, these electric vehicles from Ford, the dealer invoice price was the same"
The Lightning is a truck that runs on electricity instead of gas. It can still pull big loads but it’s quiet and doesn’t produce exhaust fumes.
The F‑150 Lightning is Ford’s all‑electric version of the classic pickup, offering zero‑emission hauling with a high‑capacity battery. The podcast mentions it in the context of new model year releases and dealer inventory management.
"He said something about incentives that made no sense. Any input on this, it took me by surprise because of Mazda CX-5S. So, Dad, this is in Florida, which I also love to see. Will the out-the-door price change by $2,000 if I choose a 60-month financing and put $10,000"
The CX‑5 is a small SUV that feels like a car when you drive it. It’s comfortable, good on gas, and has a nice interior.
The Mazda CX‑5 is a compact crossover praised for its driving dynamics, upscale interior, and fuel efficiency. The podcast discusses confusing incentive programs that affect the out‑the‑door price for this model.
"From space, however, Mazda CX-5 has a $2,000 customer cash that cannot be stacked with a special APR."
It’s a money‑off deal that the dealer gives you right away when you buy. Think of it as a coupon that lowers what you pay for the car.
A customer cash incentive is a direct discount offered to the buyer, usually in the form of a rebate or cash back at closing. It is separate from financing offers and can reduce the purchase price immediately.
"From space, however, Mazda CX-5 has a $2,000 customer cash that cannot be stacked with a special APR."
It’s a special, lower interest rate you can get on your car loan for a short time. It helps you pay less money over the life of the loan if you qualify.
Special APR refers to a promotional financing rate offered by the dealer or manufacturer that is lower than the standard rate. It often comes with conditions such as a limited duration or specific credit requirements.
"...d the dealer for an outdoor price on a 2025 Ford Maverick XL Hybrid, listed at $29,400 and online had a dea..."
The Maverick is a small truck that’s easy to drive and saves gas. It’s a good choice for people who need a pickup but don’t want a huge vehicle.
The Ford Maverick is a compact, fuel‑efficient pickup that gained popularity for its hybrid powertrain and affordable price. The discussion focuses on dealer pricing strategies for the 2025 model year.
"you can see inventory on particular cars. How many for sale and days on market, etc."
When a car sits on the dealer’s lot, each day it counts as one day on market. A low number means it sells fast; a high number means it’s been there long.
Days on market is the number of days a vehicle has been listed for sale. It indicates how quickly or slowly a car is selling.
"you can see inventory on particular cars. How many for sale and days on market, etc."
A dealer’s inventory is the list of cars they have on their lot. Knowing how many cars are available can tell you if a model is popular or rare.
In automotive sales, inventory refers to the number of vehicles a dealer has available for sale at any given time. It helps buyers gauge supply and demand.
"prices on Mazdas will continue to soften. When I make my deal, the dealership is telling me why wait the prices will be higher in 2026. We have a CX-50 right now. Do you have any insight to share on 2026 Mazdas? Yeah, Dad, the prices of 2026 new vehicles will be higher than 2025 new vehicles."
The CX‑50 is a small SUV that looks tough and can handle light off‑road adventures. It’s still easy to drive on the highway.
The Mazda CX‑50 is a newer crossover that blends rugged styling with everyday practicality, targeting buyers who want off‑road capability without sacrificing comfort. The podcast discusses dealer pricing expectations for 2026.
"...al on here, but what do you think of the current Tesla Model Y lease, and do you think there are better optio..."
The Model Y is a car that runs on batteries and can drive about 300 miles on one charge. It’s known for its quick acceleration and lots of tech features.
The Tesla Model Y is a compact electric SUV that blends performance, range, and advanced tech. The podcast examines current lease offers and compares them to other options in the market.
"... much should I expect off MSRP on a 2025 or 2026 Camry hybrid? We've got the zip code here. Also, do we lose Bl..."
The Camry Hybrid is a car that uses both gas and electricity to save fuel. It’s known for being reliable and comfortable.
The Toyota Camry Hybrid is a midsize sedan that combines a smooth gasoline engine with an electric motor for excellent fuel economy. The podcast explores expected discounts on 2025/2026 models and potential trade‑in value changes.
BlackBook gives you the price a car is worth on the used-car market.
BlackBook is a website that provides used car values and market data.
Select text to request an explanation
Happy Holidays! Want to give your host a gift? Consider subscribing, rating, and reviewing the show this holiday season. It really helps the show grow. From all of us at Believe, have a Merry Christmas everyone, and a Happy Holiday!
It's noon here in Ventner City, New Jersey and our nation's capital, Washington, D.C., and this is Carage Live for Friday, December 26th. Yes, boxing days for all of you who are a fan of boxing days in, well, the U.K. and the Commonwealth.
And, well, your host today are the normal host today, me, Ray here in Ventner and Zach right there in his living room. How are you today, handsome?
I'm doing fantastic. I hope everyone had a good Christmas. I know I sure did. I spent time with my sister and her daughter and her husband. It was a lot of fun.
That I hope you enjoyed Christmas as well. I know it was calm here in Car Edge Land. We weren't that busy yesterday, but holy cow, our read back and better than ever.
Car slides show you fake prices. We'll get you the real one, folks. We have a promotion ongoing back at CarEdge.com. If you were trying to get a vehicle before the end of the year, now's the time.
Well, actually, the time was a couple of weeks ago, but we can still help you out. $150 off our car buying service, 15% off CarEdge Pro.
For those of you that are not familiar, for the past six years, my dad and I have been building this business. It's a car buying service that takes care of the research, dealer outreach, and even negotiation.
We learn what matters to you. Contact dealers, compare roll offers, and help you get the best deal without the stress.
If you're interested in learning more, check out CarEdge.com. Please know that we built this to help you buy a car. We do not work for car dealers.
You can learn more about why we started this down at the bottom of the page.
The big story this morning, dad, is that there are over 1 million left over 2024 and 2025 cars for sale nationwide right now.
I think we need to spend some time making it very clear to everyone that going into the new year, dad, these dealers and these automakers are highly motivated to sell this inventory.
You come to the CarEdge car search, searching for new cars. There's over 3 million new cars for sale.
Come down here and go to year. Zoom in on this really quickly. Set this to 2025.
We don't want to be looking at 2022. Is 2024 and 2025 drum roll please?
We've got 1 million new cars that are about to be unsold into the new model gear.
Now, is this knowing that it's just looking at new cars?
Yeah, this is just new cars, dad. We're looking at just new cars. We have over a million, 1 million and 28,000 2024 and 2025 new cars for sale right now.
We're heading into 2026, dad. Help us all understand. You ran dealerships for 40 years.
What happens when January 1 comes around and it's the new year and you're still selling last year's models? What happens?
Well, if you're working for Mr. Roger Penske, you're getting an SD email because you're not supposed to have any of last year's model year vehicles left over moving into the new year.
But it puts extra pressure on the dealerships to get rid of them.
Even the customers say, well, it's a year old car. We just got it six weeks ago. It doesn't matter. It's a year old car.
It's not a year old car, but that's the way the public looks at it and the public expects to save the proverbial poop ton of money if they were to, I don't know, take it off your hands.
So as a dealership employee, you're looking at it as I have to do whatever needs to be done to see to it that those vehicles, the remaining 2024s and God knows you shouldn't have any of those.
But if you do and the remaining 2025s, you have to do whatever it takes to make sure they're sitting in somebody else's driveway as opposed to your lot.
So, yeah, dealers are pretty much motivated to make them go away.
And then again, there's other dealers out there that look at some of these things as if we're a fine line and they think that some of these models will get better with age.
And unlike a fine line, cars don't because lot rot takes its toll.
You're not there. Put yourself on screen so we can hear you.
Let's start with the 2024 pops. Let's start here. We had an awesome article that Rebecca on our team wrote back on the car edge.com blog.
And this is save 20% or more on leftover 2024 models in December.
And dad, I want to start here on the 2024s because these are the vehicles that have been, I mean, quite frankly, like these are the lot rot vehicles.
53,411 new 2024 models sat unsold on dealership lots at the beginning of December and not all brands are equal here.
We're going to run through the brands that have the most unsold inventory and you can see it right here.
First and foremost, that is Ford. I'm going to scroll down to it.
Ford at the beginning of the month had 16,298 leftover 2024.
So if I'm a Ford dealer out there and I'm sitting on a leftover 2024 F-150 and we are now five days away from 2026,
what am I doing to get rid of that new 2024 F-150 that's still on my lot?
Well, let me rephrase it. What am I not doing? Because I'm probably doing everything to get rid of it. What am I not doing?
Well, the first thing you're doing is you are probably putting a large spiff or commission or a bonus on those remaining 2024s that you have on your lot.
So you're saying to your salespeople, if you were to sell any remaining 2024s, new 2024s that we have between now and the end of the year,
your minimum commission on those vehicles, regardless of whatever type of deal we take, the minimum you will earn, say, is $500.
Maybe it's $750. Maybe it's $1,000, whatever you have to do to motivate your staff to share those vehicles with every customer that comes in.
The other thing you're doing is you're going through your CRM, your customer management tools that your salespeople have used and you're looking up any customers that expressed interest in any of those 2024s
and you are sending them emails, letting them know that we don't want to have any of these here when we go into 2026 and so that no reasonable offer will be refused.
Now, here's the beauty of when a salesperson or a dealership says that, they are also the ones who will determine what is or is not reasonable.
But assuming that they're not losing $10,000 or $15,000 per vehicle sold, they'll do what they need to do to get rid of them. They're not getting better.
We set the guideline in that blog post at 20%. That's what you should be shooting for off of MSRP on a new 2024 because if you think about it, the new 26s are already out and so you're getting essentially a two-year-old vehicle.
To your point, who knows if it's actually two years old, but the two-year model years, I mean, that would have been depreciated as a used car.
And let's actually spend a second on that. Sorry, take the point that you wanted to go, Dad.
But I also want you to talk about how can you actually confirm when a vehicle was produced? You've got a cool trick for that.
Well, it's not all that hard. Just open up the driver's door and on the pillar or at the bottom of the pillar or someone on the pillar will be a manufacturing plate that will list the VIN number and the month and year that the vehicle was produced.
So that's pretty easy to find. So you could be looking at a 2024 that literally might have been produced in, I don't know, November of 2023, October of 2023, whenever.
So you can look and you can see pretty close to exactly how old that vehicle is.
Now, it might not have sat on that particular dealer's lot. They might have swapped inventory with another dealer and maybe they've only had it a couple hundred days as opposed to 700 days.
But yes, you can look at that plate and it will tell you the month and year in which it was built.
Yeah. So that's a good trick that you can use. If you're looking at some of these older new vehicles, obviously on the car edge, car search, you can see how long a vehicle has been sitting on a dealer's lot.
And that's super helpful because it tells you how negotiable it's an input for how negotiable a vehicle is. Here's a good example here at this particular dealership in Florida.
This Chevy Colorado is going to be more negotiable than the Tahoe right next to it because the top Colorado has been there 184 days. The Tahoe has only been there 20 days.
The longer a vehicle has sat on a dealer's lot, the more motivated the dealership is to sell it. That being said, you can open up that driver's side door, look in that door jam, and you will see the manufacturing plate.
And that's a great idea if you're buying especially at 2024 because to your point, it could be well over two years old right now heading into its third birthday post-production.
These can be an example of new cars that you should have, I hate to say this, a pre-purchase inspection done on where you bring in an independent mechanic or take it to an independent mechanic and have them take a look at the vehicle.
Many of these vehicles will have flat spots on tires because tires develop flat spots when they don't really get driven much. There could be wiring issues, there could be electrical issues, there could be a battery issue.
There are constant draws on batteries whether the car is turned on or not because of all the electronics and technology that's built in. That drains a battery.
So you want to make sure that the battery has the requisite charge so that I don't know 30 days after you purchase it, you're not buying a battery.
So you need on those type of vehicles to get a pre-purchase inspection done so that you can make sure that it is everything it is supposed to be and all those things that aren't can be taken care of and addressed by the dealership before you take delivery.
Now Dad, we've got a kind contribution that came in earlier in the show from Squeegee Kids. Thank you for this, I really appreciate it.
Hello Reynzac, I'm thinking 900,000 of the one million 23 and 24 models are located at those gotcha motors franchise dealerships for those of you who haven't seen my Dad and we do these shorts where we roll play buying a car and every video takes place at a gotcha motors, gotcha Ford, gotcha Honda, gotcha Mazda doesn't really matter because we gotcha.
but thank you. Once we get you, we got you. Yeah, that's our slogan. Got your motors, ladies and
gentlemen. We've got here from Igor. Good to see Igor. Happy holidays, Zach. There's a lot of 2024
unsold cars at dealer auctions right now. Also, some brand dealerships are dumping their 2025
models since they had 26 models getting ready to arrive sometime in June. Now, this is interesting,
Dad, because you are the man who went viral on YouTube years ago, five years ago. What happens
to unsold new cars? You explained it. There is no such thing as an unsold new car. If I pop back
over to our blog post over on CarEdge.com, Ford has 16,298 leftover 2024 model year new cars.
Those dealers will sell those cars. They may not get sold to a retail customer. They may get sold
as used cars at the dealer auctions. That's another way for these dealerships to get rid of
their old inventory that they weren't able to sell. Yeah, of course. Here's what people don't
realize. Once the vehicles invoice to the dealership, the dealer's floor plan bank,
the bank that provides them with the line of credit to pay for all their vehicles,
the bank pays for that vehicle. It's the owner's responsibility or the dealership's
responsibility to turn that hunk of metal into cash. Now, sometimes, most of the times,
they are able to sell them and make some type of profit on the front end and a sizeable profit
on the back end. The whole thing is, well, profitable where you can make a lot of money.
But there are other times where vehicles sit and you're not necessarily going to make a lot of
money, and so you just take what you can in order to, well, turn that into cash.
So that could mean that you take a short deal from a customer, or if you haven't had any luck with
that, you run these vehicles to the dealer auctions and you sell them there. Even though
their new cars didn't have no miles, the dealer that buys it then can turn around and sell it
as a used car, and it can get sold for much less than what maybe that vehicle would have sold for
when it was brand new. But somebody somewhere is going to turn that into cash if you're the original
dealer, you're going to turn it into cash even though it might be a loss. So you can take that
cash and buy something that you can sell and make a profit on. And the dealer that buys it at the
auction knows that they're buying it at a cheap enough price that they can turn around and sell
it because they're going to save the new customer a significant amount of money over someone who
might have purchased it brand new. Now, that tied to this would be warranty. And we're going to talk
for your first and second about in-service state, because again, there's a million new cars that
are unsold, 24s and 25s heading into or five days away from 2026. Hey, CarEdge folks, this is from
Mark. How does the warranty work on a 2024 model year vehicle? If the vehicle's never been registered
and a new vehicle that's still sitting on the dealer's lot should not have been registered,
then the warranty goes into effect when the retail sale is posted. So in other words,
once the dealer sells it and they turn in the retail delivery report to the manufacturer stating
the date that the vehicle was sold, well, that's the date that the warranty begins. Now,
if it gets sold at an auction, you know, the used car dealer that buys it,
they're not the ones that get the report the retail delivery. So, you know, honestly,
I'm not sure how the warranty would work on those because it may never have been reported as a
retail delivery. I think it has less to do with the RDR, Dad, the retail delivery report. Oh,
cool. Watch, I think it has more to do with the title transfer. Once the title is transferred,
the vehicles in service, right? Well, no, if it's not reported to the manufacturer,
they would have no way of knowing. That's a good point, yeah. That's what triggers the warranty,
is the date that it was sold and reported to the factory. So there's a new gamesmanship that can
happen here because if you don't report it sold to the manufacturer, the warranty clock doesn't
start. But if you did, then the warranty clock doesn't start. But I think good question maybe
to ask, because imagine, it's not the date of manufacture, it's the date that you need to do
with the date of manufacture. There's everything to do with the date of the retail sale. And so,
I'm not sure if a dealer were to sell one at the auction and then report it as sold to whatever
used car dealership bought it, or whatever other dealership bought it, if that would trigger the
warranty or not, because that's not the retail customer, that's a wholesale customer.
Sure. And we can get into the nuance here because before there's even a vehicle title,
there's a manufacturer statement of origin. So I wonder if when you sell a new car at the used
car auctions, you're not transferring a title, you're transferring the manufacturer statement of
origin. I don't know, it gets a little crazy in here. That being said, I think you're spot on that.
Once you alert the manufacturer, which this is a good question people can ask, if you're buying,
let's say you're buying a new, I don't know, Acura, but from a Lexus dealership,
like you've got questions to ask, right? And this would be one of them. Hey, has the warranty
gone into effect? Did you alert the manufacturer? Did the prior dealer alert the manufacturer,
et cetera, et cetera? Yeah. And I saw a comment in there from Igor that most dealers will report
it as a retail sale before they actually sell at the auction. I just know that the warranty
clock doesn't start ticking until the RDR, the retail delivery report, gets posted.
Let's go hear, Dad, from Rich. Thank you, Rich, for the kind contribution and the well wishes.
The same to you. I'm so ready for the new year, great show per usual. We're ready for the new
year too, Rich. We've had so much fun in 2025, 2026 will be even better. We're excited to keep
coming here on Car Edge Live with all of y'all. Dad Gerald says, once a laugh and gave us a
win, this is the way to my heart, folks. So let's come over here, give me a second, Dad,
and I'll need you to read this out for me. At what? Pops, is that Vin?
See something that's not quite right? Our annotations are AI-generated and can sometimes miss the mark.
Click the flag icon on any annotation to suggest a correction.