Issue Date: Car Dealer Insider June 15, 2012, Posted On: 6/18/2012
Tom Kontos of ADESA Analytical Services reinforced his longstanding view that used vehicle prices have probably seen their cyclical, as well as seasonal, peaks, average wholesale used vehicle prices were down on a year-over-year and month-over-month basis in May. Tight supplies may be easing, as dealers take more trades on rising new vehicle sales, and used vehicle prices may be approaching a ceiling relative to new vehicle prices. Thus, there currently appears to be more downward than upward pressure on used vehicle prices. Still, used vehicle supply remains relatively tight and retail used vehicle demand remains strong, so prices are not likely to fall precipitously.
According to ADESA Analytical Services' monthly analysis of Wholesale Used Vehicle Prices by Vehicle Model Class, wholesale used vehicle prices in May averaged $10,271 - down 2.9% compared to April and down 1.8% relative to May 2011. Fullsize vans and fullsize SUVs were the only segments that showed month-over-month rises, aided by easing gasoline prices during May.
Manufacturers registered a 3.2% month-over-month price increase and an 8.6% year-over-year rise, reflecting continued tight supplies of late-model off-rental and off-lease vehicles. Fleet/lease consignors experienced a 3.1% sequential price decrease and a modest 0.2% annual increase. Dealer consignors saw a 3.8% average price decrease versus April and a 2.9% downturn versus May 2011.
Based on data from CNW Marketing/Research, retail used vehicle sales in May were up 3.7% year-over-year for franchised dealers and up 0.5% for independent dealers - a rebound from year-over-year sales declines in April. Sales volumes were also up on a month-over-month basis for both groups (up a combined 17.4%). Similarly, May sales of certified used vehicles were up 9.7% month-over-month and 8.7% year-over-year based on data from Autodata.