Summer was just starting the last time Kelley Blue Book saw used-vehicle values dip as little as they did in September.

Alec Gutierrez, KBB’s senior market analyst of automotive insights, said used values declined 1 percent in September, resulting in the mildest decline in more than three months.

Kelley Blue Book expects values to continue to drop at auction through year-end, in accordance with traditional seasonal depreciation patterns.

“While the rest of the year isn’t expected to offer many surprises at auction, we expect a bump in supply early in 2013 when a jump in off-lease volume returns to market,” Gutierrez said.

“As previously stated, we could see as many as 300,000 to 500,000 additional vehicles hit the lanes in 2013, which is a welcome influx of vehicles for dealers that continue to struggle with sourcing desirable supply at auction,” he continued.

“However, the additional volume likely will not benefit the entire market as most of these vehicles will end up being remarketed via upstream channels that only will be available to franchised dealers of that particular brand,” Gutierrez went on to say.

Update on Fuel-Efficient Model Values

KBB indicated that fuel prices have finally started to ease, dropping more than 10 cents per gallon nationally since the middle of last month.

“Although we are getting some relief at the pump after the highest summer fuel prices on record, gas prices remain on pace to set the record for the highest yearly average of all-time,” Gutierrez said.

“Interestingly, while fuel prices increased from $3.40 per gallon in July up to $3.86 per gallon in September, values of fuel-efficient subcompact, compact and hybrid cars did not suddenly increase as with previous fuel spikes,” he continued. “In fact, these segments led market depreciation through that time period.”

Through September, KBB found that values of fuel-efficient vehicles began to stabilize, ending several months of market-leading declines.

Values of compact cars were down a scant 0.6 percent while subcompact cars increased by 0.5 percent on average.

Hybrid models continued to decline, dropping nearly 3 percent, “perhaps signaling that consumers remain unwilling to pay the premium for a hybrid vehicle when there are more affordable gas-powered cars that achieve 40 mpg on the highway,” according to Gutierrez.

As fuel prices continue to ease, KBB expects values of fuel-efficient vehicles to resume mild depreciation at auction.

Through the rest of the year, analysts anticipate declines of 1 to 2 percent overall for the bulk of these vehicles before stabilizing prior to the typical seasonal uptick during spring.

“While fuel prices are dropping nationally, we should note that California has seen a rapid increase in fuel prices during the past week related to power outages at a major refinery in Torrance,” Gutierrez said. “Fuel prices have jumped close to 50 cents per gallon since Sept, 27, and have shown no signs of slowing down thus far.

“Dealers in California should be prepared for a jump in demand, even if only temporary, for fuel-efficient vehicles on their lots,” he continued. “While the jump in fuel prices will not last for long, a jump of 20 cents per more in a day can certainly prompt consumers who already were in market to buy a vehicle to switch to something more efficient.”