Being that Fourth of July falls in the middle of the work week this year, Black Book’s Ricky Beggs noticed how the schedule is forcing auctions to make adjustments as the wholesale market continues to behave in unusual ways.

So Beggs began his latest edition of “Beggs on the Used Car Market,” by declaring, “Happy Birthday America!”

He acknowledged it will be a slightly different week in the industry and the retail market with the “greatest summer holiday” right in the middle of the week.

“Even the physical auction schedules will be modified with some of the Wednesday sales being on Monday or another day and others not even being held at all,” Beggs pointed out. “That’s not the case with the online offerings as there will be access to those sites 24/7 if you need additional inventory.”

Beggs then turned his attention to what happened in the lanes as the industry prepped for the Fourth of July.

“As the market was getting ready for the holiday, there was plenty of activity,” he began. “The only problem was the activity consisted of a significant number of no sales; the consignors were holding tight to their floors and the buyers were being just as stubborn in their bid levels, which was probably reflective of the generally reported slower retail business.

“There was less need to buy fresh inventory with fewer holes to fill. The only exception to the no-sale trend was with the super nice extra clean condition units,” Beggs continued.

“Many comments we heard this past week related to the late model vehicles needing to open the gap to the coming 2013s and the fact that quite a few of the rental companies are offering a few more of the 2011s and 2012s, and some with edgier levels of mileage,” he went on to say.

In light of those scenarios, Black Book’s editor ended up adjusting the second-most vehicles in a single week so far this year. Last week, they adjusted 2,964 vehicles per day, a figure second only to 3,295 price modifications for the week of Jan. 13

“Where I had a dealer from Alabama tell me the adjustments in the market started about a month earlier this year than last, the number of daily adjustments a year ago was at 1,539,” Beggs shared.

“Another interesting note is this year, 18 percent of the adjustments were increases. A year ago it was 38 percent increasing,” Beggs recollected.

Looking at overall price changes by segment, Black Book found “a pretty strong downward change” for cars, as prices softened by $44 or 0.33 percent. Meanwhile, editors determined trucks slipped by $70 or 0.55 percent.

Beggs indicated the car segment that decreased the least a week ago was entry sporty cars, which dipped by $32; and the truck segment that incurred the smallest price decline was full-size crossovers, which ticked $19 lower.

“Full-size crossovers represent a versatile type vehicle — think vacation time — which for the size and space, gets very acceptable fuel economy,” Beggs surmised.

“And with gas prices declining again this week to $3.44, at least consumers are feeling good about this part of their spending,” he continued. “This is the same level as the week of Jan. 30, yet still 21 cents higher than the low point, the week of Dec. 19.

As Beggs discussed in a separate analysis with Auto Remarketing found here, Black Book found the great wholesale price declines last week came within luxury segments. Among these segments were premium sporty cars (down $78), prestige luxury cars (down $72), near luxury cars (down $62) and luxury level cars (down $48).

“Over the last three months except for a couple of weeks in April when the premium sporty cars declined in the $80 and $90 level, there has not been this level of change within a group of cars,” Beggs stated.

As luxury models sunk, Black Book noticed six of the 14 truck segments declined by $72 or more. The movement was led by the compact crossovers (down $92) followed by luxury SUVs (down $89), full-size pickups (down $81) along with compact SUVs and full-size SUVs (both down $78 each), as well as midsize SUVs (down $72).

“There have been larger segment adjustments over time, but I can’t remember the overall consistency within as many segments at this level,” Beggs emphasized.

‘“As a dealer in Michigan commented, ‘the market has a few bright spots but most are held back by a slow retail,” Beggs continued.

“Except for July 4, we’ll be on the lanes again this week to report the changes, whatever direction that might be,” he went on to say. “Thank you for the number of you who called me this past week just to talk about the various scenarios in the market.

“I look forward to even more calls and insightful discussions this week. We wish for you a great week,” Beggs concluded.

Beggs’ video can be viewed below.

Black Book’s Specialty Market Analysis

As they do at the beginning of each month, Beggs and the rest of the Black Book team offered their glimpse into the specialty markets.

“We are now halfway through 2012, and the specialty markets continue to grow in the volume of business and the interest from consumers as the economy recovers, even if ever so slow,” Beggs explained.

Medium Duty and Heavy Duty Trucks

Within the medium- and heavy-duty markets, Black Book said there are reports of an uptick in activity in new construction and even more so in single family home remodels and repairs.

“The commercial construction and also in delivery as tonnage being moved is increasing,” Beggs noticed. “As we track the medium-duty and heavy-duty truck markets, the supplies of used medium- and heavy-duty trucks are adequate to meet the market demand; thus the used market values are not being pushed up.”

Last month, Black Book reported a pattern of decreasing wholesale values within the medium duty models. Editors indicated July brings more of the same, especially those late model trucks that continue their downward trend.

“Once again they are not dropping by large amounts, but they are still dropping,” Beggs noted.

Black Book discovered the heavy-duty side of the industry is acting much in the same way as the medium-duty side.

“We continue to see a slide in the wholesale prices for this group at auctions around the country,” Beggs highlighted. “As we said last month, the drop in prices that we are continuing to see this month, are nothing to be alarmed about. These prices are coming more in line to where they should be at this time of the year.

“We do expect to see a continued softening of the market in the coming month,” he added.

Just like the medium duty models, Black Book noticed there has been a retail sales increase for the month of May. The increase above April sales was 6.5 percent with a year to year increase for the month of May being 35.5 percent.

“Hopefully this growth will have moved right into the month of June,” Beggs stressed. “Here again, we will have to wait for those numbers to come out in July for the actual results. Keep in mind how few new sales occurred a year ago. With shipping tonnage continuing to increase these sales gains should continue.”

Last month, Black Book introduced its new myTrucks app for Android, and editors shared the response “has been tremendous for this friendly to use tool.”

If dealers want heavy, medium and trailer data on their Android smartphone, they can contact Black Book at (800) 554-1026 to get more information.

To wrap up this portion of the specialty market, Beggs shared a story.

“Charles Cathey and I had the opportunity to celebrate the 40th anniversary of Trailer Research, a great family run operation in Springfield, Mass.,” Beggs began.

“Part of this event included some impressive older trucks and as you can see, they brought a smile to the Black Book heavy truck editor Charles Cathey,” Beggs continued. “We also walked around the exhibiting trucks at the 2012 National Convention of the Antique Truck Historical Society. As old as some of these trucks were, I was amazed at how many were still ‘working in the industry.’”

Collectible and Exotic Cars

Black Book determined there are positives in this segment of the specialty markets as this is the only segment showing increasing values in all market segments of collectible vehicles.

Editors indicated prices for pony cars are up 2.1 percent from last published book and data while prices for muscle cars and American classics come in just a bit lower, but still increasing at 0.5 percent and 0.85 percent, respectively.

Editors went on to mention prices for classic American pickup trucks once again outperformed the cars, climbing roughly 2.7 percent. They added European sports cars have also continued to rise, up 1.4 percent, and the upper end of the market, the vintage exotics, climbed 2.3 percent this month.

“The late model exotic market continues to follow its usual patterns,” Beggs explained. “Current year vehicles will typically sell for a premium of anywhere from 10 percent to 50 percent higher than the original MSRP, and will stay above that benchmark until the vehicle is from 18 to 24 months old, at which time the values will begin to decline fairly rapidly.

“If you are in the market for one of these vehicles, remember that optional equipment can drastically alter the vehicle’s MSRP,” Beggs recommended. “Adding anywhere from $25,000 to $50,000 in options is very common. Options typically do not hold their value as well as the vehicle itself does, so account for that before you make a large purchase.”

Recreational Vehicles

Black Book pointed out the consumer usage of these RVs is currently at the peak, whereas the wholesale market for the recreational vehicles has begun their seasonal decline.

Editors found the average motorhome had a wholesale price of $39,144, down $1770 or 4.5 percent from last month.  Towables, including travel trailers, fifth wheels and camping trailers, averaged $10,693, a drop of $463 or 4.3 percent.

“We expect values to continue to decline in the coming month,” Beggs projected. “Most consumers have already made their RV purchases, so dealers are not buying as many units at auction.  However, as we have said before, if the right RV crosses the block, it will have no problem attracting bidders.”

Black Book reiterated that fuel prices continue to drop, and many analysts predict them to keep declining well into the summer.

“Diesel is actually 13 cents per gallon lower today at $3.68 than when the calendar turned to 2012,” Beggs pointed out. “Gas hasn’t reached the January 1 amount, but the current $3.43 per gallon is still welcome. This is great news for dealers, since RVs are by definition ‘vehicles,’ and their cost of use is directly tied to how expensive fuel is.

“Let’s face it, motorhomes are pretty thirsty, as are most full-sized tow vehicles, so any drop in fuel prices, even just a few cents per gallon, is a positive factor that might be the tipping point between a customer buying an RV and ‘going home to think about it,’” Beggs went on to say.

Motorcycles and Powersports

Beggs wrapped up his specialty markets discussion with this favorite.

“During the June market and as we head into the July auctions every segment is down versus last month,” Beggs explained. “This is normal for the time of year as the riding season is in full swing, and dealers are past the prime retail selling season and are beginning to let inventory levels drop.”

Black Book calculated the average price decline among the late model street bikes, dirt bikes, ATVs, and utility vehicles is about 1.5 percent.

“Usually, personal watercraft and jet boats maintain their values a little longer into the summer than the bike and ATV segments, but they have also seen similar declines in value, and are down a little less than 2 percent versus last month,” Beggs noted.

Snowmobiles, which see very little activity at this time of year, have also decreased in value by another 2.5 percent as well.

“No surprises here for sure,” Beggs interjected.

Editors found one area of relative strength is Harley Davidson. Prices for the brand are only down 0.7 percent this month compared with a decline of 1.3 percent for Cruiser segment as a whole.

Beggs asked, “Is this a sign of a final push to get those bikes on the road for the annual Sturgis extravaganza?”

Beggs closed by reiterated that dealer now can use the new Motorcycle Value app for Android and iPhone, developed in conjunction with the AMA.

“It is only $1.99 and is geared towards the average retail consumer,” Beggs said. “It offers a great way for the general public to get an idea of what their bike is worth. It does not have the same depth of information, nor the ongoing update of values provided in our normal industry only publications and apps.

“If you have questions or comments within the specialty markets please drop me an email and I will be glad to help and may even connect you directly to the industry and market experienced editors of the specific market,” he went on to say. “All the best with your business and we hope to visit with you again the first of August.”

Beggs’ video on the specialty markets can be viewed below.