KAR Auction Services chief economist Tom Kontos easily explained the notable wholesale price decline he and his analyst team spotted after compiling November data.
According to ADESA Analytical Services’ monthly analysis of wholesale used vehicle prices by vehicle model class, Kontos noted wholesale used-vehicle prices in November averaged $10,599 – down 4.2 percent compared to October and down 1.8 percent relative to November of last year.
“Average wholesale prices in November softened on a year-over-year basis in part from comparison to last year’s inflated prices from Hurricanes Harvey and Irma,” Kontos said in his latest edition of the Kontos Kommentary that arrived on Friday afternoon.
“Still, prices were down on a month-over-month basis in November at a greater-than-seasonal level, indicating weaker market conditions,” he continued. "Off-lease units remain a major bright spot, as these vehicles are scarcer at physical auctions, despite growth in lease terminations, because more of these units are being purchased upstream.
“As a group, the truck segments held up somewhat better than the car segments, but virtually all model classes showed declines,” added Kontos, who elaborated about the latest trends in this video.
When holding constant for sale type, model-year age, mileage, and model class segment — using criteria that characterize off-lease units — Kontos also pointed out that prices were up significantly on a year-over-year basis for both midsize cars and midsize SUV/CUVs when he examined specific units at 3-years-old and less than 45,000 miles.
Wholesale prices for those specific cars climbed $652 or 6.1 percent to $11,308 while wholesale prices for those particular SUV/CUVs spiked $1,734 or 9.8 percent to $19,374.
Looking elsewhere at November activity in the wholesale space, Kontos mentioned average prices for used vehicles remarketed by manufacturers softened 3.0 percent month-over-month and 2.8 percent year-over-year.
He added that prices for fleet/lease consignors declined 3.8 percent sequentially rose 4.6 percent annually.
Kontos also noted average prices in November for dealer consignors slid 3.7 percent versus October and 1.9 percent relative to November of last year.
Based on data from the National Automobile Dealers Association, Kontos wrapped up his latest analysis by highlighting retail used-vehicle sales by franchised dealers rose 2.2 percent year-over-year in November, but ticked 0.9 percent lower for independent dealers.
Kontos also said November certified pre-owned sales dropped 3.3 percent compared to the prior month but increased 1.8 percent year-over-year, according to figures from Autodata Corp. On a year-to-date basis, he mentioned CPO sales remain up 2.2 percent versus last year.
|November 2018||October 2018||October 2017||Prior Month||Prior Year|
|Total All Vehicles||$10,599||$11,059||$10,797||-4.2%||-1.8%|
Source: ADESA Analytical Services.