Wholesale used vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) fell by 0.2% in February. However, given a sharp decline in pricing in February last year, the Manheim Index now shows a year-over-year gain of 1.1%. The Manheim Used Vehicle Value Index stood at 124.6 for February.
Although wholesale prices rose in only one month out of the last seven, stability remains the watchword for used vehicle values given that all of the declines were small, according to Manheim. In the face of heavy new vehicle inventory and incentives, the stability of used vehicle values is a credit to the retail market that continues to provide dealers the ability to quickly retail wholesale acquisitions at reasonable grosses.
The auction volume of risk units actually sold was up in the first two months of 2017, even though conversion rates were a little weak, according to Manheim. Given that new vehicle sales into rental were down during this period, it suggests that the rental companies were getting their fleets right-sized.
In February, straight average of auction pricing for rental risk units was up 5% from a year ago, but much of that reflects mix shifts and mileage changes as well as a temporary weakness in the market last year. Manheim’s index of rental risk pricing that adjusts for broad changes in mix and mileage was down both sequentially (-1.2%) and year-over-year (-3.8%), according to the company. The average mileage on rental risk units sold at auction was 39,100 miles, which is very close to what it has averaged since last summer.
Although pricing for trucks, CUVs, and vans remain up year-over-year while cars are down, the weakest of the car segments (compacts) has actually tracked the overall market the past three months. It is risky to say that compacts reached their bottom — because there have been so many false bottoms over the past couple of years — but there are promising signs, says Manheim.
On a nonseasonally adjusted basis, sports cars were the only segment that was up, but the February lift was much less than normally occurs. As such, the seasonally adjusted price for sports cars in February was down more than any other major segment, according to Manheim.
See all comments