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 tak¬≠en the biggest hit ‚Äď rep¬≠re¬≠sent¬≠ing four out of five of the top lead¬≠ing seg¬≠ments in depre¬≠ci¬≠a¬≠tion. Black Book has been care¬≠ful¬≠ly watch¬≠ing how gaso¬≠line prices have been affect¬≠ing cars ‚Äď while they‚Äôre high¬≠er than usu¬≠al late¬≠ly, the gas pump price increase is typ¬≠i¬≠cal for the sea¬≠son and is prob¬≠a¬≠bly not enough of an increase to strength¬≠en used car seg¬≠ment 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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