After a group of analysts reported that October saw the biggest auction price decline this year, it seems used-car price depreciation is slowing down this month.

Following a 3.5-percent drop last month, according to NADA data, depreciation “eased up substantially over the first half of November,” NADA Used Car Guide senior automotive analyst Larry Dixon wrote in a blog post this week.

The latest entry to the Used Car and Truck Blog said prices among vehicles up to eight years in age have fallen by 1.2 percent so far this month.

For comparison, October’s mid-month decline came in at 3.1 percent.

RVI Group released data this week that looked at a different age group of used cars — vehicles from ages 2 to 5. Its latest Market Update found that wholesale values for this age group were up 1.2 percent in October when compared to September.

RVI Group also reported that on a year-over-year basis, prices were up 3 percent in October.

“Midsize sedans and small sedans saw some of the highest price increases in October; only four segments saw price decreases from a month ago (in October), with sports cars lagging the most,” RVI reported.

More from NADA on November Trends

As price declines ease this month, Dixon explained that at the segment level, midsize van prices have led price improvement, rising by 1.6 percent so far this month.

This is up from October’s full-month drop of 4.7 percent, Dixon pointed out.

Again, the NADA data set is for vehicles up to 8 years in age.

“The stabilization in mid-van prices has come despite 2013 model-year volume increasing by 32 percent or 522 units over the first two weeks of the month (relative to the second half of October),” Dixon wrote in the blog post.

Taking a look at supply, Dixon reported that volume for units up to 8 model years in age grew 1 percent so far this month, showing an 8 percent rise in both 2011 (off-lease) and 2013 (rental fleet).

He also explained the increase in 2013 model-year volume is largely due to the rise in midsize van supply, as well as spikes in volume for compact car, midsize car and midsize utility units.  

He also provided the following data showing how much additional segments have depreciated so far this month:

Luxury car: Down 1.4 percent
Luxury utility: Down 2.2 percent

Compact and  midsize cars as well as compact and mid-size utilities have also seen drops within a range of 1.2 percent to 1.5 percent.

Lastly, large pickup and SUV segments continue to see strong price retention, with prices only dropping by 0.7 percent and 0.1 percent, respectively.

Wrapping up his commentary, Dixon also provided predictions for the rest of the month.

“Should price movement continue on the current course, deprecation this November will show similar strength to what was recorded for the month in 2012 when prices were supported by a Hurricane Sandy-induced spike in demand,” Dixon said.

“This would lend credence to NADA’s position that last month’s federal government shutdown artificially nudged consumer demand, and thus prices, lower than they would have been otherwise," he added.

To view the original NADA post, click here.

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