Wholesale used vehicle prices (on a mix-, mileage- and seasonally adjusted basis) rose for the fourth consecutive month in April. This resulted in a Manheim Used Vehicle Value Index reading of 124.9, which represented a 4.8% increase from a year ago, according to Manheim Consulting.
Due to rising wholesale supplies, most market participants had been expecting to see some easing in used vehicle values, but the strength of the retail market is preventing any meaningful decline in prices. The competitive nature of the wholesale market means that dealers keep on bidding until their expected grosses become insufficient to cover the risk, says Manheim.
In April, new cars and light-duty trucks sold at a seasonally adjusted annual of 16.1 million, says Manheim. Total new vehicle fleet sales were up in April, but only because of significant increases from a year ago in both commercial fleet and government purchases. New vehicle sales into rental were down more than 3% in April — and off 7% for the first four months of the year.
According to CNW, total dealer sales of used vehicles rose 4% in April, resulting in a year-to-date increase of 2%. And CPO sales increased 9.5% in April and 10.5% year-to-date.
Unadjusted for mileage and mix shifts, auction prices for rental risk units continued to rise in April. And when adjusted for mileage and mix, prices were down marginally from March but still up nearly 7% from a year ago, according to Manheim.
All major market classes now have year-over-year prices gains, but the increase for luxury cars is insignificant. Although wholesale pricing in the luxury segment has suffered for more than a year, luxury vehicles outperformed the overall market in April, says Manheim.