The recent surge in wholesale prices apparently isn’t over, but the near future is likely to see an extended slowdown in values, according to the RVI Group.

Following what the firm believes will end up being a 14.1-percent year-over-year increase in the RVI Used Car Price Index for full-year 2011, wholesale prices are projected to rise 2.1 percent next year.

But for several years following, wholesale prices are expected to decline.

In fact, RVI projects a 0.3-percent year-over-year drop-off during 2013 followed by a 1.2-percent dip in 2014.

A 1.0-percent softening in used prices is expected for 2015 and a 0.3-percent downturn is projected for 2016.

“The expected increase in 2012 used-car prices comes from a couple things,” RVI vice president Rene Abdalah told Auto Remarketing. “First, new-car prices are expected to increase slightly by 0.5 percent.

“Secondly, and most importantly, the RVI Used Vehicle Stock Index shows a large year-over-year decline, leading to the 2.1-percent increase in annual prices,” he continued. Specifically, the decline in the stock index, the firm noted, is expected to be 30.9 percent for 2012.

For 2013 through 2016, it’s a different story.

Increased competition is likely to push new-vehicle prices down, resulting in lower used prices, as well, Abdalah said.

RVI indicated that during the fourth quarter of 2011, the Japanese automakers boosting sales efforts will lift competitive pressures, which are then expected to climb for several years.

The RVI Competitive Index is projected to jump 3.7 percent in 2012, another 3.5 percent in 2013 and then climb 3.3 percent in 2014. The following year is forecasted to show a 2.7-percent hike followed by a 0.5-percent uptick in 2016.

August Used Prices

While the most recent wholesale pricing data provided by RVI was from August, Abdalah did note when asked about early indicators for September, that used values “have held steady in September so far when compared to August.”

As for August, RVI’s used index jumped 14.4 percent year-over-year, despite a 0.7-percent decline from July.

Among the various segments, RVI took an in-depth look at luxury small sedans, which were comparatively stronger than the overall market. During August, their year-over-year price gain of 16.2 percent outpaced the market (up 14.4 percent). Luxury small sedans also climbed 0.5 percent from July, while the industry dipped 0.7 percent sequentially.

“Luxury small sedans can be considered a late bloomer. As used-car prices were improving from mid-2009 through mid-2010, luxury small sedans stayed relatively flat. Its consistent improvement has really occurred over the last 12–14 months,” Abdalah explained.

However, the rest of 2011 is likely to show this segment declining from its current used value. For 2012, used values of luxury small sedans are projected to jump 2.2 percent from 2011 and then climb 0.5 percent year-over-year in 2013.

Then, the segment’s values are projected to dip each year after, falling 0.4 percent in 2014, 0.6 percent in 2015 and 0.8 percent in 2016.

Auction Volume

Sharing some other wholesale data in its analysis, RVI also noted that there were auction volume increases in both July and August.

“We’ve seen new car volume on a SAAR basis increase over the last couple of months leading to more used cars in the market,” Abdalah shared. “An increase in incentive activity has helped with this increase.”