Page 12 - PIADA-March 2022-Final-web

KONTOS KOMMENTARY
2022 Kontos Outlook

By Tom Kontos, Chief Economist, KAR Global
2021 was a banner year for wholesale combustion engines, it’s going to be costly
vehicle values. On a full-year basis, we saw and will take a while to figure out how
values above pre-COVID/2019 levels by we will produce and consume energy in
30% for the year, as a perfect storm in used a new way. These things take time and
vehicle demand faced a perfect drought in will be expensive in the near term. This is
used vehicle supply—much of which was important to keep in mind, as we see more
brought on by the chip shortage. and more electric vehicles entering the car OPEN FOR
ecosystem.
As we look ahead to 2022 and what the In short, 2021 brought us new records in REGISTRATION
year may bring for our industry, there are
several key things to keep in mind and look pricing and new lows for inventory. I’m ADVANCED ISSUING
out for as the year unfolds—consider this looking forward to analyzing trends for all
my Kontos Krystal Ball: of our customers and partners throughout AGENT TRAINING
2022 with the hope that greater stability will CLASS
Repossessions will probably be the “first be beneficial to both. n
responders” to the used car shortage. Monday, March 14
Because of government stimulus plus Disclaimer: The views and analysis provided
deferrals and forbearance programs that herein relate to the vehicle remarketing 9:00am til 2:00pm
banks and lenders have provided, people industry as a whole and may not relate America’s Auto Auction
were able to postpone or avoid potential directly to KAR Global. The views and Harrisburg
repossessions. We will possibly now see an analysis are not the views of KAR Global, 1100 S. York Street
uptick in repos as these programs are slowly its management or its subsidiaries; and their Mechanicsburg, PA 17055
phased out—not back to pre-pandemic accuracy is not warranted.
levels, but we should see increases. Members $99

Forward-Looking Statements: The Nonmembers $129
In mid-2022, I suspect we will be talking Pre-registration is required.
a whole lot less about the chip shortage, as statements contained in this report and
manufacturers use creative new approaches statements that the company may make See page 22 to register.
to address this problem. New car inventory orally in connection with this report that
will move closer to normal helping used are not historical facts (including, but WHO NEEDS TRAINING
vehicle demand stabilize. not limited to, expectations, estimates, Agent service – Any person who
assumptions and projections regarding primarily is involved in completing
I also anticipate more stable wholesale the industry and business) may be motor vehicle transactions (Forms
values—in other words no dramatic rises forward-looking statements. Words such MV-1, MV-4ST and MV-120) and is
or falls in 2022. We will likely see a return as “should,” “may,” “will,” “anticipates,” responsible for accuracy of motor
to pre-pandemic seasonal patterns with the “expects,” “intends,” “plans,” “believes,” vehicle applications.
usual uptick during tax season in the spring, “seeks,” “estimates,” “promises”, “likely
and a gradual softening the rest of the year. to” and similar expressions identify Card agent – A notary public,
forward-looking statements. Forward- commissioned by the Department
In general, I will be keeping my eye on looking statements are subject to risks of State, Bureau of Legislation,
the economy—focusing on employment, and uncertainties that could cause actual Commissions of Elections, who
inflation and GDP growth. One area that results to differ materially from the is approved by PennDOT to issue
is of major concern to many economists results projected, expressed or implied by temporary registration cards in
is inflation and the spillover impacts that the forward-looking statements. Factors conjunction with applications for
might accelerate higher interest rates that that could cause or contribute to such transfer of registration plates.
could potentially make new and used differences include those matters disclosed This course is recommended for
vehicles less affordable. in the company’s Securities and Exchange individuals with more than one year
Commission filings. The company does not of experience completing motor
As we transition to renewables from fossil undertake any obligation to update any vehicle title work.
fuels and electric vehicles from internal forward-looking statements.

10 | MIDATLANTIC DEALER NEWS | MIDATLANTICAUTODEALERSUNITED.ORG • MARCH 2022