Manheim’s Tom Webb recently projected where repossession volumes might settle at this year, acknowledging his estimate is a little lower than anticipated.

Webb predicted 2011 repo volume will include 1.3 million units, extending a decline since the industry peak two years ago. He pointed out repossessions totaled 1.9 million units back in 2009 and came in at 1.55 million units a year ago.

In discussing with Auto Remarketing how he arrived at his 2011 projection, Webb began by stating, “We’re obviously seeing some hard data from our clients through the first half of the year.

“Quite frankly, the repossession volumes are down a little more than I anticipated. We expected they would be down, but they’re down more a little more,” he continued.

Webb then rattled off several reasons why repos are heading downward toward levels Manheim reported for 2005 and 2006

“We’ve had some tightening of lending standards. We’ve had declines in contracts outstanding, which is a pullback from subprime lending. We’ve had some improvement in the labor market, not much, but some,” Webb surmised.

The Manheim economist mentioned one other reason for decline repossessions, a factor he admits that he also should have anticipated because wholesale values of used vehicles are so strong.

“There are a lot of people who normally would be upside down on a loan but now are not,” Webb indicated. “If you’re in a positive equity situation, there’s really no reason for a repossession to occur, but sometimes, it obviously does.

“The more logical course of action would be for the owner to sell the vehicle and pay off the note,” he suggested.

Webb also touched on how the remarketing of repossessed vehicles is changing, too. He mentioned how Manheim and Renovo Services recently reached a partnership to streamline the entire process from recovery to remarketing. Auto Remarketing published the details of that decision here.

“It’s changing the remarketing of these vehicles,” Webb noted. “(More repossessions) are now selling upstream so it would be more of an online transaction as opposed to the repossessions actually running through a physical lane.”