Wholesale used vehicle prices — on a mix-, mileage-, and seasonally adjusted basis — increased 0.75% month-over-month in August, bringing the Manheim Used Vehicle Value Index to a record high of 131.3.
The weakest performing wholesale vehicle segment in August was the mid-sized car segment. Values for mid-sized cars fell by 0.2% year over year, the largest decline among all vehicle segments. Meanwhile, vans and pickups saw the largest gains in wholesale value among all vehicle segments.
Overall, the wholesale market continues to show strength as a result of growing retail demand, according to Manheim. The Manheim report attributes most of the increase in used vehicle sales to double digit year-over-year growth in sales of vehicles less than 4 years old.
Although, while used vehicles less than 4 years in age performed well in August, the used cars in general saw a decline in sales in August. This weak month, however, is being seen as a bump in the road in an otherwise strong year.
Year-to-date, used car sales are up 1.2% and it is expected that used cars will finish the year up 3% over last year.
In the new-vehicle segment, light trucks continued to perform well in August, with sales up 2% year-over-year. Cars, on the other hand, continued to see consumer demand falter as August sales for the segment were down 9% year over year.
Overall, new-vehicle sales were down 3% year over year in August, according to Manheim. Much of the decline, however, was due to Hurricane Harvey’s impact on Southeast Texas.
Cox Automotive estimated that anywhere between 320,000 to 580,000 vehicles would be damaged by Hurricane Harvey. Replacement demand along with a reduction in available supply is expected to cause wholesale inventories to tighten for the next two to three months, the company noted.
“Supply will be pulled from other regions, so the impact to the wholesale market will be widespread, providing additional support for continued wholesale price gains for at least the next two months,” noted the Manheim report.