April Used Prices Rise on Truck Strength, Kontos Says
Average wholesale prices increased in April from March and from a year ago on the strength of truck values, but several benchmark segments in fleet lease sales are showing weakness, said Tom Kontos in his monthly commentary.
by Staff
May 18, 2017
Screenshot of Tom Kontos courtesy of ADESA.
2 min to read
Screenshot of Tom Kontos courtesy of ADESA.
Average wholesale prices increased in April from March and from a year ago on the strength of truck values, but several benchmark segments in fleet lease sales are showing weakness, said Tom Kontos in his monthly commentary.
"Much of these supposed increases in used vehicle values are the result of strength in truck prices and growth in off-lease volumes," Kontos said. "An analysis of sales prices by sale type, model-year age, mileage and model class segment reveals that prices actually fell in April on both a month-over-month and year-over year basis for two bellwether model classes. This drill-down is more reflective of the downward pressure of supply growth on used vehicle values."
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Average prices reached $11,141 in April, which was a 2.2% increase over March and a 2.5% increase over April of 2016. Compact, mid-size and luxury cars all showed year-over-year price declines of 2% or more, while most of the truck segments registered significant year-over-year gains.
Average wholesale prices for used vehicles remarketed by manufacturers were up 2.5% month-over-month and up 3.7% year-over-year. Prices for fleet/lease consignors were up 1.5% sequentially and up 3.2% annually. Average prices for dealer consignors were up 5.1% versus March and up 3.9% relative to April 2016, Kontos said.
Breaking the data down by age shows that prices were down 1.3% for three-model-year-old units (a good proxy for off-lease units). Moreover, a further drill-down into the data reveals the following results for April.
April CPO (certified pre-owned) sales were down 3.6% month-over-month and up 0.7% year-over-year according to figures from Autodata.
Following Hertz, the company is the second global car rental conglomerate to sustain sizable losses due to lower customer demand and usage of electric rental cars.