Used car ‘time bomb’ complicates auto industry transformation, new report says – Los Angeles Times

The historic transformation of the automobile industry will generate billions to trillions of dollars for companies and investors. But for traditional automakers, the road ahead will be bumpy, risky and expensive.

That’s the assessment of consulting firm AlixPartners, which released an extensive report Wednesday that uses market research and consumer surveys to lay out some of the major challenges facing automakers — with some interesting findings about Tesla.

The report includes a near-term industry outlook with a darker forecast for U.S. auto sales than most other prognosticators have put forth.

Record-high vehicle sales in 2016 will dive 13% from 2017 through 2019, the firm predicted — to 15.2 million vehicles from 17.5 million — in what it calls a cyclical but ill-timed downturn made worse by a “used car time bomb” as hundreds of thousands of vehicles come off lease all at once.

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