🚗 CarMax is cutting prices to move volume

TOGETHER WITH

Today, we’re talking about responding to pressure. A solid strategy is not a plan that never panics. It’s a plan that already knows what to do when panic shows up.

The stories below come from three vantage points on the same problem: a large used retailer responding in real time, consumers getting louder about affordability, and fresh wholesale data confirming relief is not coming from out there, so we’d better get to work in here.

Read on, then tell us, on a scale from “oh, neat” to “ugh, another one?” How do you feel about Google’s agentic shopping tool for retailers? Do you think it could be useful for auto someday?

Keep Pushing Back
-Chris with Paul, Kyle & Kristi

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TOGETHER WITH NADA

Final Call for NADA Show Hotel Rates

Heading to NADA Show 2026? The deadline to book your hotel at exclusive NADA rates ends tonight.

Wait any longer, and you’ll be rolling the dice on price and availability. And that’s the kind of gamble you don’t want to take—even in Vegas.

This is your last chance to stay close to the action without overpaying for it.

Book through NADA today and lock in your rate before the window closes.

Reserve your room and register now.

THE NEWS

CarMax Used Car Pricing Strategy: Lower Prices and Thinner Margins to Drive Unit Volume

In the never-ending quest to grow gross, CarMax is leaning into a counterintuitive move: lower prices and lower margins to drive unit volume.

Management says price cuts will be targeted by vehicle, not a flat percentage across the lot, and the company plans to support the move with increased marketing while still reducing overhead. CarMax’s goal: cut SG&A by $150M annually.

CarMax Q3 (ended Nov. 30):

• Revenue –6.9% YoY to $5.8B

• Used units –8% to 169,557

• Avg used price +0.9% to $26,383

What your customers are hearing right now

While CarMax is publicly committing to lower prices and thinner margins, the consumer conversation is getting louder and harsher.

Mainstream outlets are framing both new and used vehicles as affordability traps, not alternatives. According to Edmunds, more than 20% of new-car buyers now carry monthly payments of $1,000 or more, an all-time high. Used cars are increasingly pulled into the same narrative as prices and rates remain elevated.

Customers increasingly see both new and used cars as expensive, high-risk monthly payments, not “affordable options.”

Manheim Used Vehicle Value Index Update: Wholesale Prices Stay Firm as Inventory Ages

Now go upstream, Cox Automotive follows that story, closer to where those behaviors begin, at the wholesale level where supply, conversion, and pricing pressure show up before they hit the retail lot.

On Thursday (Jan. 8, 2026), Cox reported the latest Manheim Used Vehicle Value Index. The headline largely confirms the direction CarMax has been signaling on used pricing staying firmer than many expected. Values were up 0.4% versus last December and essentially flat month over month (+0.1%). But the deeper cuts add context on what retailers are navigating right now:

• Wholesale prices are holding firmer than typical, even though depreciation picked up in the fall

• Sales conversion is stronger than usual, signaling healthier demand at auction

• Wholesale inventory is aging: units 6 years and newer have fallen from 71% (2020) to 57% (2025), changing recon risk and front-line merchandising

Dealer Strategy for 2026: Brand Alignment, Awareness, and Experience When Margins Tighten

What’s a dealer to do in the middle of this squeeze? CarMax can flex pricing with national scale, and wholesale conditions are not offering much relief yet. For most retailers, the answer is not price alone.

Instead, dealers are leaning into alignment. As Automotive News reported, Genesis retailers are doubling down on brand awareness, experience, and sales growth, betting that a stronger brand and deeper customer connection can protect turn, loyalty, and fixed ops when margins thin.

That means investing in marketing, facilities, people, and consistency across the network. And with NADA around the corner, and ASOTU CON not far behind 😉, the direction is clear: the future of retail is less about going it alone, and more about moving forward together.

AROUND THE ASOTU-VERSE

Dealer Conferences and Industry Events (2026)

• January 22: Public Policy Day, D.C. Auto Show, DC

• February 3-6: NADA Show 2026, Las Vegas, NV (Looking for a party?)

• May 12-15: ASOTU CON 2026, Hanover, MD

Quick Hits

• 🤖 Tech: Toyota has an electric pickup. It’s called a Hilux because “x” is cool.

• 💰 Economy: U.S. housing hit a milestone: more homeowners now have mortgage rates above 6% than below 3%, easing the “rate lock” that’s been freezing listings and slowing transactions.

• 🔭 Science: A former Google CEO plans to personally fund four telescope projects, including a modern Hubble telescope replacement.

Today in History: January 12

• 1904: Henry Ford drove the rebuilt 999 on Lake St. Clair ice, setting 91.37-mph land speed record, attracting investors early.

• 1906: The Dow Jones Industrial Average closed above 100 for the first time, signaling growth but preceding widespread public interest in the market.

• 1969 – The New York Jets of the American Football League defeat the Baltimore Colts of the National Football League to win Super Bowl III in what is considered to be one of the greatest upsets in sports history.

Thanks for reading, Friend! I’ll confess that today I found too many good things to write and had to save some. So, check back in same time tomorrow and let’s keep pulling this thread. #Thriving