During this past week, a large number of no-sales plus an industry “hesitancy” to build inventory from the auction lanes prompted Black Book’s Ricky Beggs to question where these trends are coming from.

The managing editor said, “The numbers out of the used wholesale activity during the past week seem to have indicated hesitancy in the buyers to build retail inventory from the auction lanes.

“Or maybe it is the sellers, through holding onto some strong floors, which might be holding back better sales conversions and possible increasing prices,” he highlighted in his latest “Beggs on the Used Car Market” video report.

in taking a closer look at the results and data from the lanes last week, the facts reflect the strong number of no-sales, Beggs explained. So, what factors are leaving cars in the lanes unsold?

“The weather is often a factor and even though it is winter time, the liquid form of snow — or I should heavy rain — affected and hindered many sales,” Beggs said.

But judging from dealer and expert comments, there were a few positive notes Beggs shared from the lanes last week, as well.

“If there was a more positive reflection, it was focused on the slightly older cars that get a little extra attention during tax time and also the interest in the really clean condition cars having better sales conversion rates,” Beggs said.

Moving along to highlight price adjustments in the lanes, Beggs said last week was a “very active” week in the number of vehicles that required an adjustment.

At 2,462 vehicles adjusted each day throughout the week, “this was the largest number since the week ending September 14, 2012,” Beggs shared.

Moreover, 19 of 24 segment types had over 50 percent of their models with a change, according to Black Book.

As far as the segments with the most changes, 93 percent of midsize pickups had price adjustments and 70 percent of compact pickups had adjustments.

“With this many models being adjusted we see plenty of interest, but at different values than previously sold and published,” Beggs explained.

The primary adjustments were decreases in value, as 13 of the 24 segments had 40 percent or more of their vehicles being decreases, Beggs shared.

The prestige luxury cars had the highest number of price decreases last week, with 60 percent of the segment’s vehicles dropping in price. The average price decline for these units was $334.

Overall, the cars had an average segment drop of $64.

This marked the largest weekly declining average since the week ending Nov. 30. But not all car segments contributed to this decline.

When looking at the car segments, four different individual segment types retained values in a dollar level better than the total car segment average every week for the past quarter of time, Beggs said.

The types ranged from the compact cars to the full-size cars as well as the entry-level cars and the entry midsize cars.

On the other hand, perhaps in tune with the season, Beggs said the trucks continue to show more “stability” than the cars.

This past week the trucks dropped an average of $28, which was slightly better than the previous weekly drop of $36.

Four segments increased for the week as compared to only two increasing segments for both of the first two weeks of the year, Beggs shared.

The cargo and passenger versions of the full-size van were joined this past week by the increases in the cargo minivans and the compact pickups.

Wrapping up his commentary, Beggs said, “Most years the activity and values show increases for this time of the year. Even though that is not the case so far this year, we do not feel this is a cause of concern or an indication of a year-long weak used car market.

“The strength in value retention during December was above the norm, creating a stronger starting point than normal and giving us a chance to ease into the new year. To see if this trend continues, tune back in next week for the latest update,” he concluded.
 

Sarah Rubenoff can be reached at srubenoff@autoremarketing.com. Continue the conversation with Auto Remarketing on both LinkedIn and Twitter.