Consumers who raced to take advantage of the auto industry's zero percent financing and cash incentives for new cars in the last quarter of 2001 flooded the market with late-model used cars, helping create a glut that sent used-car prices into a dramatic downward slide.

But Paul Taylor, chief economist for the National Automobile Dealers Association (NADA), said the used-car glut already is showing signs of drying up -- in part because the new-car sales that generate trade-ins for the used-car lots are expected to fall by a million or so units this year, according to the Orlando Sentinel.