Wholesale used vehicle prices continued their predominantly seasonal softening in September, as they descended from their all-time highs in April, according to Tom Kontos in ADESA's September Current Used Vehicle Market Conditions and Outlook.
Strong new-vehicle sales in September support the thesis that some car shoppers are gravitating towards new vehicles when faced with a choice of paying relatively high prices for used cars versus affordable new cars, as long as financing and available inventory are not prohibitive factors.
This tendency will continue to provide downward pressure on wholesale prices even as tight used vehicle supplies maintain price pressure upwards. Expect prices to continue their typical seasonal decline in October and November, with a modest uptick in December as some remarketers hold cars until the new year.
According to ADESA Analytical Services' monthly analysis of Wholesale Used Vehicle Prices by Vehicle Model Class, wholesale used vehicle prices in September averaged $9,830 - down 1.7 percent from August and up 1 percent versus prior year. Truck prices held up better than car prices during the month.
Manufacturers registered a 0.7 percent month-over-month price increase and a 2.7 percent year-over-year rise, indicating still-strong demand for off-rental program units. Fleet/lease consignors experienced a 2.1 percent sequential price decrease and a 1.9 percent annual increase, in part from strong dealer demand for rental risk and commercial fleet units. Dealer consignors saw a 3.3 percent average price decrease versus August and a 7.3 percent uptick versus September 2009.
ADESA Analytical Services estimates that auction industry inventory levels stood at 31 days at month-end compared to 33 days last September, which indicates inventory levels have risen near their norms for the fall defleeting season.