Kontos Kommentary — August 2015

Aver­age whole­sale used vehi­cle prices fell on a year-over-year basis for the first time since August of 2014, as pre­vi­ous­ly ele­vat­ed sales of high­er-priced, late-mod­el off-rental pro­gram units have sub­sided and com­par­isons to pri­or year are now on more of an apples-to-apples basis in terms of sell­er-type com­po­si­tion. We now see a clear­er pic­ture of the down­ward pres­sure that sup­ply growth is putting on prices. More­over, though retail used vehi­cle demand has been strong, aver­age new car incen­tives have been climb­ing, which puts fur­ther down­ward pres­sure on used vehi­cle prices. These impacts are most evi­dent in car prices, as truck prices have held up well in the cur­rent low fuel price envi­ron­ment.

Accord­ing to ADESA Ana­lyt­i­cal Ser­vices’ month­ly analy­sis of Whole­sale Used Vehi­cle Prices by Vehi­cle Mod­el Class1, whole­sale used vehi­cle prices in August aver­aged $9,575 – down 3.1% com­pared to July and down 0.2% rel­a­tive to August 2014. Car prices con­tin­ue to bear the brunt of price declines, falling 5.8% month over-month and 5.2% year-over-year, while truck prices fell only mod­est­ly (0.6%) on a sequen­tial basis and actu­al­ly went up sig­nif­i­cant­ly (9.8%) on a year-over-year basis.

Aver­age whole­sale prices for used vehi­cles remar­ket­ed by man­u­fac­tur­ers were up 1.7% month-over-month but down 9.1% year-over-year. Prices for fleet/lease con­signors were up a mod­est 0.7% sequen­tial­ly but down 2.0% annu­al­ly. Deal­er con­signors saw a 3.6% price decrease ver­sus July but a 2.1% increase rel­a­tive to August 2014.

Data from NADA showed a 10.6% year-over-year increase in used vehi­cle sales by fran­chised deal­ers and a 12.4% increase for inde­pen­dent deal­ers in August. CPO sales were down 0.1% month-over-month and down 1.1% year-over-year, accord­ing to fig­ures from Auto­da­ta.



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