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ALG Forecasts Mid-Compacts and Premium Fullsize SUVs to be Impacted Most by Projected 2013 Gas Prices of over $4 Per Gallon

^{Published on 2010-06-02 21:01:15 - Market Wire}
 

SANTA BARBARA, Calif.--([ BUSINESS WIRE ])--ALG, a subsidiary of DealerTrack Holdings, Inc. (Nasdaq: TRAK) and the industry benchmark for residual values and depreciation data, today announced the availability of a new [ research report ] that quantifies the major supply and demand factors contributing to its 36-month residual value forecasts for two vehicle segments a" Mid-Compacts and Premium Fullsize SUVs.

"Despite the recent drop in oil and gas prices, we are maintainingour long-term gas price forecast of over $4 per gallon in 2013."

aGasoline prices are a key driver of resale values at the segment level, and this new white paper focuses on the two segments - Mid-Compacts and Premium Fullsize SUVs - that are most significantly impacted, positively and negatively,a said Matt Traylen, ALGa™s Chief Economist. "Despite the recent drop in oil and gas prices, we are maintainingour long-term gas price forecast of over $4 per gallon in 2013."

Demand in the Mid-Compact segment, which includes hybrids, spiked in 2008 when gas prices hit record highs. Although it dipped briefly when gas prices receded, demand for Mid-Compacts has remained above the industry average, benefiting most recently from a number of new product introductions and a resurgence in gas prices. ALGa™s outlook for this segment is positive, based in part on its forecast that U.S. gas prices will average $4.13 per gallon in 2013, which is expected to positively impact used auction values by 13% relative to the overall industry, contributing 9.3 percentage points to ALGa™s current 36-month residual value forecast. Incorporating other factors, ALG expects the segmenta™s used auction values to improve 29% overall over the next three years.

In the Premium Fullsize SUV segment, demand has been declining for more than two years as gas price volatility and the recessionary environment have more than offset the positive impact of new product launches. ALGa™s 2013 gas price forecast negatively impacts expected used auction values for Premium Fullsize SUVs by 20% relative to the industry, which reduces the 36-month residual value forecast for the segment by 7.4 percentage points. Overall, however, the segmenta™s used auction values are expected to be essentially unchanged over the next three years, with significant declines in used vehicle supply and increasing wages and housing prices offsetting the negative impact from gas prices.

About ALG ([ www.alg.com ])

Based in Santa Barbara, California, ALG is a leading provider of data and consulting services to the automotive industry. ALG publishes the aAutomotive Lease Guidea a" the standard for Residual Value projections in North America, and has been forecasting automotive residual values for over 40 years in both the U.S. and Canadian markets. ALG is a company of DealerTrack Holdings, Inc. (Nasdaq: TRAK).

About DealerTrack ([ www.dealertrack.com ])

DealerTracka™s intuitive and high-value software solutions enhance efficiency and profitability for all major segments of the automotive retail industry, including dealers, lenders, OEMs, agents and aftermarket providers. Our solution set for dealers is the industrya™s most comprehensive. DealerTrack operates the industrya™s largest online credit application network, connecting approximately 17,000 dealers with over 850 lenders. Our Dealer Management System (DMS) provides dealers with easy-to-use tools and real-time data access that will streamline any automotive business. Dealers using DealerTrack AAX get the inventory management tools and services needed to accelerate turns and increase profits. Our Sales and F&I solution enables dealers to streamline the entire sales process while structuring all types of deals from a single integrated platform. DealerTracka™s Compliance solution helps dealers meet legal and regulatory requirements and protect their hard-earned assets. DealerTracka™s family of companies also includes data and consulting services providers ALG and Chrome Systems. For more information, visit [ www.dealertrack.com ].

Safe Harbor for Forward-Looking and Cautionary Statements

Statements in this press release regarding ALGa™s views of the prospects of the Mid-Compact and Premium Full Size SUV segments, and all other statements in this release other than the recitation of historical facts are forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). These statements involve a number of risks, uncertainties and other factors that could cause actual results, performance or achievements of DealerTrack to be materially different from any future results, performance or achievements expressed or implied by these forward-looking statements.

Factors that might cause such a difference include gasoline prices, consumer sentiment, the overall state of the economy and other risks listed in our reports filed with the Securities and Exchange Commission (SEC), including our Annual Report on Form 10-K for the year ended December 31, 2009. These filings can be found on DealerTracka™s website at [ www.dealertrack.com ] and the SECa™s website at [ www.sec.gov ]. Forward-looking statements included herein speak only as of the date hereof and DealerTrack disclaims any obligation to revise or update such statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events or circumstances.

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