Vehicles from fleet consignors followed the broader used-vehicle market downward in September, as wholesale prices struggled to keep up with last year's hurricane-driven demand and a now robust upstream market that's taking volume from downstream auctions, said Tom Kontos, KAR Auction Services' chief economist.
"As the wholesale used vehicle market enters the period of time comparable with last year’s hurricane season, wholesale prices will be challenged to meet last year’s high, demand-driven levels," Kontos wrote in his monthly commentary. "This is reflected in average wholesale prices in September, which fell on both a month-over-month and year-over-year basis, and significantly lower retail used vehicle sales than last year."
Prices for fleet lease consignors fell 1.3% in September compared to August and are now 6.6% higher than a year ago. Other consignors fared worse. Average prices for used vehicles from manufacturers fell 1.9% for the month and are now up 0.7% from a year ago. Average prices for dealer consignors fell 0.4% from August and down 0.3% from a year ago.
The overall used vehicle market fell 0.6% for the month and is down 0.6% from September 2017. Wholesale prices averaged $10,981. Prices for truck and car segments fell at a similar rate. Segments Kontos uses as a barometer for the fleet industry fared better than the overall market, as midsize cars increased 6% to $12,298 from a year ago and midsize SUVs increased 4.6% to $20,634 from a year ago.
Based on NADA data, retail used vehicle sales by franchised dealers were down 6.3% year-over-year in September, and were down 8.7% for independent dealers. September CPO sales were down 8.9% from the prior month and down 3.9% year-over-year, according to figures from Autodata. On a year-to-date basis, CPO sales remain up 1.8% versus last year.
Originally posted on Automotive Fleet