April 2015 Wholesale Used Car Values Trend Report


Wholesale used vehicle prices, on a seasonally adjusted basis, fell in April 2015 by 0.2% over the prior month according to auction-house, Manheim, making it the third consecutive month of price declines.  The firm, which compiles a monthly “Used Vehicle Value Index”, reported that prices had actually ticked up a tad before adjustment.  Compared to April of last year, wholesale used-car prices were down 0.6%.

The recent decline in prices does not suggest a weakening trend, argues Manheim.  If anything, the decline is believed to a correction in prices, which have been elevated over the past several months.

Used Vehicle Sales

The market for used-cars remained strong in April with public dealer-groups reporting the 23rd quarterly increase in unit sales in a row.  The groups, which include AutoNation, Sonic and Lithia, reported a 6.7% increase in same-store sales and healthy total profits.  Sales of certified-preowned vehicles (CPO) were up 11.3% over the prior month and 11.4% over April 2014.

A $2.9 Billon decline in tax-refunds (1.1%) over last year appears to have hurt dealers selling lower-priced vehicles, where buyers tend to rely upon refunds for vehicle purchases.

Rental Car Pricing

Wholesale prices for rental cars fell more than 4% on both a seasonally adjusted and average basis.  It should be noted that the decline was compared to last year, where prices were at record highs.  Another mitigating factor might be higher than average auction volumes, given an almost 12% increase in new car sales for rental use over the first quarter of 2015.

Pricing according to Market-Segments

Reflecting April new car sales, wholesale pricing for SUVs and pickup trucks remained strong, with the midsized vehicle segment remaining somewhat weak as it has been for most of this year.

Based on price-tiers, Manheim reported strong pricing for vehicles priced above $15,000 and weakness in the $9k-$11k range.  Unit volume in this price segment was also much higher, compared to last year.  Strong new-car sales and the fact that most vehicle in the $9k to $11k segment are two to three-year old compacts and midsized together explains the weakness in wholesale pricing in this segment.

– Farra Majid

Earlier SpeediMango 2015 Wholesale Used Car Values Reports

February      March

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Posted by: Farra Majid on Thursday, May 7th, 2015 at 10:30 pm in INDUSTRY