The Manheim Used Vehicle Value Index declined 1% in July from the previous month and increased 1.5% from a year ago. While it was the third straight month of decline in wholesale pricing, talk of a free fall in pricing has been premature. Wholesale prices have been trending on a secular downward since reaching their peak in May 2011; but the changes have been modest and subject to several up-cycles within the larger trend.
Price Collapse Feared During Drop Prior to Historical Seasonal Weakness:
Collapse would also require significant altering in labor market and credit conditions, which appears to be unlikely.
While Used Sales Were Slower in July, it Shouldn’t Set Off Alarm Bells:
Dealers are continuing to report good turn rates and strong profits in used sales.
Wholesale Price Decline for Most Luxury Cars Twice that of Overall Market:
July also saw segments within luxury that suffered even more, including entry level and premium units.