Black Book Sees Used Car Price Drop Coming for Five Popular Segments

Heavy storms in January and February had a big impact on pent-up demand and used car prices blossoming in March, as the NADA Used Car Guide and ADESA Analytical Services’ reports demonstrate this week. Seasonal patterns always carry their weight, and Black Book is expecting to see some notable performance trends, according to Ricky Beggs, Editorial Director at Black Book. That has a lot to do with the historic tax-buying season for used vehicles as lots of shoppers use tax rebates on used car purchases.

When you review the chart created by Black Book, you’ll see how five popular car segments are expected to perform in May-July 2013 retention. They’ve been showing strong retention lately (four out of five of them had price increases in March), but should have above-average depreciation in the short-term future. Making this list were Entry Mid-Size Car, Full-Size Car, Full-Size Crossover, Upper Mid-Size Car, and Compact Car.

Cars have taken the biggest hit – representing four out of five of the top leading segments in depreciation. Black Book has been carefully watching how gasoline prices have been affecting cars – while they’re higher than usual lately, the gas pump price increase is typical for the season and is probably not enough of an increase to strengthen used car segment prices.

The biggest hit among these five popular categories should be taken by Entry Mid-Size Cars, which have an expected loss of 5.9% in May-July 2013 retention. Its April 2014 market value of $10,741 is expected to reduce down to $10,107 by July.

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