Used-Car Prices

How dealers are handling wholesale prices on continued climb

CARY, N.C. - 

A pair of monthly wholesale market trackers showed price increases in July, propelled in part by what trucks and utilities are fetching in the lanes nowadays.

How are dealers reacting?

Well, one weekly sale observer described the scene as “many buyers were left shaking their heads.”

So let’s get into the numbers of what’s leaving dealers with visible signs of frustration.

According to ADESA Analytical Services’ monthly analysis of wholesale used-vehicle prices by vehicle model class, KAR Auction Services chief economist Tom Kontos reported that wholesale used vehicle prices in July averaged $10,902 — up 0.1 percent compared to June and up 0.1 percent relative to July of last year.

Meanwhile over at RVI Group, the firm’s Used Vehicle Price Index (UVPI) for the United States came in at 1.057 in July compared to 1.034 in June and 1.014 last July. RVI calculated that readings represented an increase of 2.2 percent month-over-month and 4.2 percent year-over-year.

In his monthly Kontos Kommentary, the KAR expert explained that actually more car and truck segments showed month-over-month declines than gains with a slight uptick in the mix of trucks accounting for the small overall average gain. Kontos pointed out that truck model classes now make up 53 percent of the total units sold at auction with the 50 percent threshold having been reached about a year ago. 

“After four months of year-over-year declines, average wholesale used vehicle prices registered a slight increase in July,” said Kontos, who is among the collection of experts coming to Used Car Week, which begins on Nov. 12.

“However, this was primarily due, once again, to a shift in sales mix towards the truck model classes and the continued influx of younger off-lease vehicles, both of which have been tending to drive up average prices.  Still, the summer market for used vehicles appears to be solid, both at the wholesale and retail levels,” Kontos continued.

The editors at Black Book are responsible for watching wholesale prices as well as collecting anecdotes from the lanes. According to the latest Market Insights report, Black Book determined small pickups and full-size cars both showed gains this past week, even though we’re getting deep into summer.

“Subcompact cars have started to show some weakness after a strong retention trend earlier this year. On the other hand, sub-compact crossovers are continuing to do relatively well,” said Anil Goyal, Black Book executive vice president of operations, who also will be on hand for Used Car Week, which is being orchestrated at the Westin Keirland Resort and Spa in Scottsdale, Ariz.

Volume-weighted, Black Book reported that overall car segment values decreased by just 0.20 percent last week. In comparison, editors mentioned values had decreased at a rate of 0.22 percent per week during the previous four weeks.

Among car segments, sub-compact car values decreased the most last week, softening by 0.56 percent or $34.

Again volume-weighted, Black Book noticed that overall truck segment values (including pickups, SUVs, and vans) dipped by 0.15 percent last week. Editors noted that values had decreased at a rate of 0.24 percent per week during the previous four weeks.

Within truck segments, full-size van values decreased the most last week, dropping by 0.50 percent or $74.

In light of all of those data points, Black Book’s lane observers stationed at sales nationwide shared some pretty vivid dealer responses to how managers are juggling their inventory needs against their floor-plan availability.

— From Michigan: “The retail market remains somewhat sluggish in contrast to what happened at the wholesale auction this week. Many buyers were left shaking their heads at the inflated prices on the block.”

— From Massachusetts: “Trucks still rule, and the money was strong except for the poorer quality vehicles.”

— From Georgia: “The sale started off with a lot of activity and very few no-sales. The conversion percentages soon dropped as the floors seemed to be too ambitious.”

— From California: “Strong bidding in person and online, resulting in a really good August sale.”

Whether the sale originated in the Golden State or elsewhere nationwide, if the event included fleet and off-lease units that were 3 years old and less than 45,000 miles on the odometer, Kontos shared how buyers needed to come up with more cash to make the hammer drop in their favor for those vehicles.

Kontos indicated that when holding constant for sale type, model year age, mileage and model class segment, prices for midsize cars in that late-model category rose 5.9 percent or $676 year-over-year in July to $12,169. Prices for midsize SUV in this wholesale space increased 2.2 percent or $435 year-over-year to $20,541.

“Once again, midsize car prices outperformed prices for midsize SUVs and crossovers, as the incoming supply of trucks continues to outpace that of cars,” Kontos said.

“The strength of prices for both groups in this analysis indicates that upstream sales are preventing an oversupply of off-lease units from reaching physical auction lots,” continued Kontos, who elaborated about the wholesale market in a video available here as well as at the top of the page.

Kontos went on to mention more data from KAR Auction Services — a member of the Automotive Intelligence Council — that indicated average wholesale prices for used vehicles remarketed by manufacturers in July rose 3.3 percent month-over-month and 3.4 percent year-over-year.

Kontos also noted that prices for fleet/lease consignors ticked up 0.4 percent sequentially and 8.1 percent annually in July.

Furthermore, Kontos mentioned that average prices for dealer consignors moved 2.0 percent higher versus June but slid 2.3 percent relative to July of last year.

The KAR chief economist closed his latest Kontos Kommentary by sharing information from Autodata that indicated July certified pre-owned sales softened 7.5 percent from the prior month and 1.9 percent year-over-year based on fewer selling days. On a year-to-date basis, Kontos added that Autodata has CPO sales up 2.8 percent versus last year.

ADESA Wholesale Used-Vehicle Price Trends

   Average  Price  ($/Unit)  Latest  Month Versus
   July 2018  June 2018  July 2017  Prior Month  Prior Year
           
 Total All Vehicles  $10,902  $10,895  $10,887  0.1%  0.1%
           
 Total Cars  $8,519  $8,548  $8,613  -0.3%  -1.1%
 Compact Car  $6,434  $6,441  $6,582  -0.1%  -2.3%
 Midsize Car  $7,457  $7,533  $7,633  -1.0%  -2.3%
 Full-size Car  $7,275  $7,495  $7,018  -2.9%  3.7%
 Luxury Car  $13,294  $13,172  $13,582  0.9%  -2.1%
 Sporty Car  $14,225  $14,515  $14,164  -2.0%  0.4%
           
 Total Trucks  $12,922  $12,901  $13,058  0.2%  -1.0%
 Minivan  $7,937  $8,652  $8,604  -8.3%  -7.7%
 Full-size Van  $13,306  $13,202  $11,875  0.8%  12.1%
 Compact SUV/CUV  $10,805  $10,829  $10,467  -0.2%  3.2%
 Midsize SUV/CUV  $10,992  $11,135  $11,402  -1.3%  -3.6%
 Full-size SUV/CUV  $13,198  $13,499  $13,353  -2.2%  -1.2%
 Luxury SUV/CUV  $18,495  $18,331  $19,099  0.9%  -3.2%
 Compact Pickup  $9,796  $9,471  $9,615  3.4%  1.9%
 Full-size Pickup  $16,583  $16,386  $17,061  1.2%  -2.8%

Source: ADESA Analytical Services.

       

Manheim index climbs 5% to new series high

ATLANTA and LAWRENCEVILLE, Ga. - 

As Auto Remarketing reported, the July seasonally adjusted annualized rate for used-car sales hit the highest point for the start of a third quarter in six years.

That sales pace Cox Automotive highlighted as well as the recent lane activity Black Book recently witnessed appear to be fueling a wholesale market turbine that’s pushing one of the industry’s benchmarks to a new high.

Cox Automotive recapped that wholesale used-vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) increased 1.51 percent month-over-month in July. Analysts explained the movement brought the Manheim Used Vehicle Value Index to 136.9, which represented a 5.1-percent increase from a year ago and the highest level ever for the series.

Looking at trends in weekly Manheim Market Report (MMR) prices, Cox Automotive indicated that the abnormal summer bounce that started in June continued and strengthened in July.

“Correspondingly, the best-selling cars at Manheim are worth more today than a month ago, and many vehicles are worth more now than a year ago,” analysts said. “Price comparisons to last year will be tougher through the rest of the year; but recent weekly increases were higher than last year, keeping current price performance ahead of last year.”

Over at Black Book, editors recently noticed how depreciation slowed again.

According to the latest edition of Black Book Market Insights, a handful of cars are continuing to show some of the strongest one-month retention trends during July — a time when cars are historically supposed to begin seeing heavier depreciation heading into the late summer months.

Volume-weighted, overall car segment values decreased by 0.22 percent last week, according to Black Book. In comparison, editors mentioned the market values had decreased by 0.25 percent on average in the prior four-week period.

“Wholesale markets values are steady as dealers continue to stock up on inventory for used vehicles due to strong retail,” said Anil Goyal, executive vice president of operations at Black Book.

On the truck side, Black Book’s volume-weighted information showed that overall truck segment values (including pickups, SUVs and vans) decreased by 0.15 percent last week. In comparison, the market values had declined by 0.26 percent on average during the previous four-week period.

Black Book’s anecdotes from the lanes added further color to the numbers editors tabulated.

An auction general manager in Connecticut told Black Book’s representative, “We have recently had record sales regarding consigned vehicles and sales conversions which have consistently been above 70 percent.”

Next door in Massachusetts, the lane watcher recapped, “The dealers are willing to spend extra money on the nicer units. The captives and the fleet/lease sellers had their best sale in weeks.”

And in the Midwest, the pace of sales was reinforced by the observer stationed in Indiana saying, “Dealer business is good, so they are buying replacement vehicles for their lots. Trucks and luxury cars are still scarce as is any vehicle that is really nice.”

Turning back to the Cox Automotive wholesale assessments, the Manheim data showed all major market segments saw price gains on a year-over-year basis in July. Compact cars and midsize cars outperformed the overall market, rising by 5.2 percent and 7.2 percent, respectively. Not far off the overall price rise were pickups (up 3.3 percent), utility vehicles (4.5 percent) and vans (up 3.4 percent).

Even within the rental-risk space, Cox Automotive spotted how pricing strengthened.

Analysts indicated the average price for rental risk units sold at auction in July was up 6 percent year-over-year and 1 percent month-over-month.

Cox Automotive added that the average mileage for rental risk units in July — at 45,200 miles — rose 9 percent year-over-year and 6 percent month-over-month. 

Cox Automotive closed the commentary analysts shared with the latest Manheim Index update by trying to summarize what all of the unusual wholesale trends mean.

“The strange summer price appreciation in used cars is partly a function of a strong economy at its peak, with mounting affordability challenges for the consumer that favor growth in used-vehicle sales at the expense of new,” analysts said. “These conditions have supported strong used-vehicle prices for over a year.

“The catalyst for even stronger price movement this summer is the fear of import tariffs’ leading to higher prices in the future,” they continued. “Higher prices and the related declining level of supply create a psychological feedback loop for consumers, encouraging buying now with the expectation that prices may be higher later.”

Car values push up Black Book’s monthly index

LAWRENCEVILLE, Ga. - 

While experts are seeing a softening of consumer interest in new cars, Black Book is noticing the values for traditional two-door and four-door vehicles are keeping wholesale prices stronger than what’s typically witnessed during the summer.

More evidence of current trends arrived on Monday through Black Book, which released its latest Used Vehicle Retention Index.

The new reading represented an 0.5-percent increase in July as the index registered at 113.9, up from 113.3 in June. Editors indicated the index has ticked up by 0.7 percent during the past 12 months.

Editors reiterated that their Used Vehicle Retention Index is calculated using Black Book’s published wholesale average value on 2- to 6-year-old used vehicles, as percent of original typically-equipped MSRP. It is weighted based on registration volume and adjusted for seasonality, vehicle age, mileage, and condition.

Leading the July index increase was the subcompact car segment with a 1-percent climb over the prior month. Editors pointed out that values for the sporty car, premium sporty car, compact car, midsize car and full-size car segments all had gains of at least 0.5 percent.

Meanwhile, Black Book spotted declines for full-size pickups and full-size luxury SUVs.

“The Black Book Index strength over the last year is a clear reflection that there is strong demand for many segments of used vehicles — particularly for cars,” said Anil Goyal, Black Book’s executive vice president of operations who is among the experts coming to Used Car Week, which runs from Nov. 12-16 in Scottsdale, Ariz.

“While we are forecasting typical seasonal depreciation pattern through the remainder of the year, dealers and remarketers should continue to see increasing sales volume on used vehicles, driven by continued employment growth and high consumer confidence,” Goyal added.

The index dates back to January 2005, where Black Book published a benchmark index value of 100.0 for the market. During 2008, the index dropped by 14.1 percent while during 2016, the index fell by just 6.4 percent.

During 2011, the index rose strongly from 113.3 to 123.0 by the end of the year as the economy picked up steam and used-vehicle values rose higher. It continued to remain relatively stable, rising slightly until May of 2014 when it hit a peak of 128.1.

To obtain a copy of the latest Black Book Wholesale Value Index, go to this website.

Wholesale prices stay ‘unusually strong’ as August arrives

LAWRENCEVILLE, Ga. - 

As the industry turns its collective calendar to August, Black Book is seeing wholesale prices staying “unusually strong” for this time of year.

The latest Black Book Market Insights report showed how cars held better retention overall than trucks this past week with prices for sporty cars again increasing slightly.

“The used-vehicle market values remain unusually strong. The depreciation rates last week were the lowest in eight weeks,” said Anil Goyal, executive vice president of operations at Black Book.

Volume weighted, editors indicated overall car segment values decreased by just 0.09 percent last week. In comparison, the values had decreased at a rate of 0.30 percent per week during the previous four weeks.

Among car segments, Black Book reported that prestige luxury car values decreased the most last week, softening by 0.30 percent or $107.

Again volume weighted, editors mentioned that overall truck segment values (including pickups, SUVs and vans) dipped by 0.19 percent last week. In comparison, Black Book recapped that truck values had declined at a rate of 0.28 percent per week during the previous four weeks.

Within truck segments, Black Book determined full-size crossover/SUV values dropped the most last week, sliding by 0.42 percent or $96.

Moving along to what Black Book collected from its representatives stationed at nearly 60 sales nationwide, dealer attendance varied greatly.

A high note was struck up in Washington where the observer, “attended a special event sale that saw record numbers with the consignment over 5,000 and a conversion rate of over 70 percent.”

Meanwhile, down in Georgia it was a different story as the representative shared, “Physical attendance was low which matched the consignment at the highline sale. Online attendance and participation was good, which saved the day.”

Going back out West, Black Book’s personnel stationed in California noticed, “Strong sales have become the norm recently as have higher prices. Dealers are having difficulty sourcing quality older vehicles.”

In the Lone Star State, Texas dealers are in search of inventory that’s not likely to surprise wholesalers as Black Book’s lane watcher said, “Trucks are selling well if they have an above average condition grade.”

The last observation originated from Tennessee where the Black Book representative stated, “SUVs and pickups are selling the best, but the consignment numbers are down.”

Black Book sees how depreciation varies greatly for 12 discontinued vehicles

LAWRENCEVILLE, Ga. - 

Black Book looked to put some data and analysis toward questions used-car managers might be asking.

On Monday, editors made available a new analytics-driven report that looks at why certain vehicle models were discontinued over the last several years, and how they’ve retained their values since discontinuation. Black Book examined 12 models, including:

— Mazda MPV
— Mercury Milan
— Ford Crown Victoria
— Saturn Ion
— Saab 9-5
— Pontiac G6
— Ford Ranger
— Mitsubishi Galant
— Honda Element
— Nissan Xterra
— Hummer H2
— Toyota FJ Cruiser

Black Book explained that some car and truck models — despite their popularity — are discontinued because manufacturers simply move production strategies in a new direction. When this situation happens, editors explained certain models retain their values better than their segment average, while others see retention values plummet.

Black Book conducted a thorough analysis that includes a mix of small- and mid-size cars, trucks, SUVs and minivans. Their discontinuation dates vary over the last few decades, and the reasons for their discontinuation are as diverse as the vehicles themselves.

As an example of this analysis, Black Book data showed that the Toyota FJ Cruiser, whose last model year was 2014, has actually gone up in value by 25.7 percent compared to other vehicles that were listed in its segment. The Hummer H2 is second-best in retention at 18.5 percent.

Editors pointed out that the Toyota FJ Cruiser was acclaimed for its off-road performance. The wide stance and short wheelbase made it look quirky. In the last model year of production, it sold only about 14,000 in 2014. Given the uniqueness of this vehicle and the relative high demand from enthusiasts, it became a modern collectible.

The change in three-year retention for the Toyota FJ Cruiser was a whopping 26 percentage points better than the mid-size crossover/SUV segment.

Conversely, editors noted that the Mazda MPV minivan — last produced in 2006 — has lost 15.8 percent of its value compared to other vehicles in its segment, and the Mercury Milan has lost 9.5 percent compared to others in its segment after it was discontinued in 2011. 

“Our analytics approach enables us to take a deeper look into historical depreciation trends to better understand how certain vehicle retention has performed over time,” said Anil Goyal, executive vice president of operations at Black Book.

“This information proves valuable to automotive dealers, lenders, OEMs and other industry professionals who each need a deeper understanding of vehicle retention patterns for the buying, selling, stocking, and financing of vehicle models.”

The complete report can be downloaded here.

Lane watch: Compact-car prices hit soft patch

LAWRENCEVILLE, Ga. - 
Compact-car prices have stayed strong for much of the year, but Black Book editors noticed these particular vehicles took a bit of dip.
 
This week’s Market Insights report from Black Book showed that while cars and trucks overall saw very similar depreciation last week, compact cars saw what editors called a “big drop” compared with the previous several weeks. 
 
Despite this development, Black Book pointed out that many remarketers across the country are still showing healthy demand in the lanes.
 
“Strong demand in the retail market is resulting in fewer no sales and relatively strong prices at the auctions,” said Anil Goyal, executive vice president for operations at Black Book.
 
Volume-weighted, editors determined that overall car segment values decreased by 0.30 percent last week. In comparison, Black Book recapped that values had decreased at a similar rate of 0.32-percent per week during the previous four weeks.
 
Among car segments, those previously mentioned compact cars decreased the most in values last week, sliding by 0.68 percent or $55.
 
Again looking at volume-weighted data, overall truck segment values (including pickups, SUVs and vans) softened by 0.28 percent last week. In comparison, Black Book noticed the values for trucks had decreased at the same rate per week during the previous four weeks.
 
Within trucks, editors noted that full-size luxury crossover/SUVs declined the most last week, ticking down by 0.73 percent or $238.
 
Moving along to what Black Book representatives stationed at nearly 60 sales nationwide, what lane watchers gathered from dealers reiterated the demand that consignors are enjoying.
 
“The market is still showing stability with few no-sales and relative strength among most segments,” the Black Book observer stationed in Georgia said.
 
Similar scenes unfolded out West.
 
The recap from Washington went this way: “Prices remain stable as all of the lanes showed good sales percentages.”
 
And from California: “Trucks and sport utilities are selling well, which is old news. Both in-lane and internet bids were active.”
 
The last two anecdotes Black Book shared for the latest report percolated out of the Midwest, which described scenes that might be playing out in other areas, too, especially if used metal is rolling over the curb at a decent clip.
 
— From Indiana: “A good sale, although consignment is still low. Retail is strong, which is prolonging the strength in the wholesale market.”
 
— From Michigan: “The post-holiday demand remains strong, which is pushing buyers to place a few extra bids to secure inventory.” 

Dealers continue to face wholesale challenge of finding clean, affordable units

LAWRENCEVILLE, Ga. - 

Perhaps not as difficult as finding that needle in the proverbial haystack, Black Book’s latest anecdotes from the lanes again described how dealers are having difficulties finding clean vehicles at the auction without completely depleting their floorplan funds.

Before getting into bidding activities, this week’s edition of Black Book Market Insights showed how prices aren’t softening like how dealers typically experience during the summer.

“The used-car market stays strong with mainstream car brand values depreciating at a low rate for this time of the year,” said Anil Goyal, executive vice president of operations at Black Book.

Volume-weighted, Black Book reported that overall car segment values decreased by 0.27 percent last week. In comparison, the values had decreased at a higher rate of 0.34 percent per week during the previous four weeks.

Among car segments, editors noticed sporty cars showed a seasonal lift in values last week, rising 0.24 percent or $37.

Again volume-weighted, Black Book determined overall truck segment values — including pickups, SUVs and vans — softened by 0.34 percent last week. In comparison, the values had declined at a lower rate of 0.26 percent per week during the previous four weeks.

Within truck segments, editors found that full-size vans and full-size luxury crossover/SUVs decreased the most last week, dipping by 0.66 or $101 and 0.62 percent or $204, respectively.

Be it a car or a truck, dealers are having trouble finding units that do not need a significant amount of reconditioning at a price that fits their particular store retail model. Here’s a sampling of what Black Book noticed at nearly 60 sales nationwide:

— From Indiana: “Business is good and dealers are holding onto their trade-ins. Nicer vehicles are scarce as are trucks.”

— From Wisconsin: “Active bidding and selling in most lanes even as dealers complain about high prices.”

— From Florida: “The older cars continue to struggle, but buyers are paying premium prices for cleaner and newer vehicles.”

— From Texas: “Our consignment has been low which has kept the values up. Bidding is quite good on most vehicles.”

— From Michigan: “Some trucks have seen a price rise during the last couple of weeks, which is unusual for our market in July.”

Lane watch: Consistent trends stretch back 4 weeks

LAWRENCEVILLE, Ga. - 

As typical as fans running on high speed above the auction lanes this time of year, Black Book is seeing that the wholesale market currently is demonstrating expected seasonal depreciation trends with car prices falling slightly more than trucks, SUVs and CUVs.

“Depreciation rates have remained consistent during the last four weeks for both car and light truck segments. The used-vehicle market is relatively strong for this time of the year,” said Anil Goyal, executive vice president, operations, at Black Book. 

According to the latest Black Book Market Insights report, volume-weighted, overall car segment values decreased by 0.34 percent last week. In comparison, the values had decreased at a similar rate per week during the previous four weeks.

Among car segments, compact cars, sporty cars and premium sporty cars depreciated the least last week, with declines ranging from $10 to $38.

Again volume-weighted, editors determined overall truck segment values (including pickups, SUVs and vans) decreased by 0.25 percent last week. Just like cars, truck values had softened at a similar rate per week during the previous four weeks.

Within the truck segments, compact vans, minivans and compact luxury crossover/SUVs decreased the most last week, dropping by 0.81 percent or $74, 0.55 percent or $71, and 0.45 percent or $88, respectively.

The truck discussion continued with some of the anecdotes from the lanes Black Book collected from representatives stationed at nearly 60 sales nationwide. Two truck tales surfaced in the Midwest, including

— From Michigan: “Trucks have seen a price rise in the last couple of weeks, which is unusual for our market in July.”

— From Indiana: “Business is good, and dealers are holding onto their trade-ins. Nicer vehicles are scarce as are trucks.

One other observation also originated in the Midwest as the Black Book representative in Wisconsin added, “Active bidding and selling in most lanes even as dealers complain about high prices.”

The two other anecdotes Black Book shared might mimic what’s happening at your local sale.

“Our consignment has been low which has kept the values up. Bidding is quite good on most vehicles,” the lane watcher in Texas said.

A Black Book observer in Florida mentioned, “The older cars continue to struggle, but buyers are paying premium prices for cleaner and newer vehicles.”

Black Book’s June index reflects wholesale market’s ‘resilience’

LAWRENCEVILLE, Ga. - 

Black Book described how the wholesale market is showing its “resilience” based on recent movement of its Used Vehicle Retention Index.

Late Thursday, Black Book released its latest index reading, highlighting that it increased 0.4 percent during June to come in at 113.3. That’s up from the May reading of 112.9.

Editors tabulated that the index has risen 0.3 percent over the last 12 months (113.0).

The Black Book Used Vehicle Retention Index is calculated using Black Book’s published wholesale average value on 2- to 6-year-old used vehicles, as percent of original typically-equipped MSRP. It is weighted based on registration volume and adjusted for seasonality, vehicle age, mileage and condition.

Black Book recapped that June saw several car and truck segments make a splash during the month with small cars and SUVs providing the biggest impact to the overall index. Editors indicated that segments making the largest gains included:

— Sub-Compact: up 1.4 percent
— Sporty: up 1.2 percent
— Premium sporty: up 0.7 percent
— Compact: up 0.7 percent
— Compact crossovers: up 0.5 percent

“The used car and truck market continues to show its resilience with several segments continuing to serve as the catalyst in driving overall increases to the Black Book Vehicle Retention Index, long after the spring market has ended,” said Anil Goyal, executive vice president of operations at Black Book.

“We believe that the used-vehicle market strength is reaching its plateau and will return to its pattern of accelerating depreciation as we get deeper into the calendar year,” Goyal continued.

The index dates back to January 2005 when Black Book published a benchmark index value of 100.0 for the market.

During 2008, the index dropped by 14.1 percent while during 2016, the index fell by just 6.4 percent. During 2011, the index rose strongly from 113.3 to 123.0 by the end of the year as the economy picked up steam and used-vehicle values rose higher.

The index continued to remain relatively stable, rising slightly until May of 2014 when it hit a peak of 128.1.

To obtain a copy of the latest Black Book Wholesale Value Index, go to this website.

Black Book pinpoints the wholesale segment to watch

LAWRENCEVILLE, Ga. - 

Black Book executive vice president of operations Anil Goyal suggested that dealers watch one particular vehicle segment closely as editors continued to see stability in the wholesale market.

“The used-car market has remained relatively stable overall,” Goyal said in this week’s Black Book Market Insights report. “However, recognizing consistent weekly trends may keep you ahead of the game. Keep an eye on luxury segments.”

Volume-weighted, Black Book reported that overall car segment values decreased by 0.3 percent last week, matching the average decrease for the past five weeks.

Among car segments, editors determined near-luxury cars had the steepest depreciation rate at 0.46 percent or $73.

Again volume-weighted, Black Book indicated that overall truck segment values (including pickups, SUVs and vans) softened by 0.25 percent last week; a bit more than the average of 0.20 percent recorded during the previous four weeks.

Within truck segments, midsize and full-size luxury crossover/SUVs decreased the most last week, sliding by 1.13 percent or $236 and 0.91 percent or $302, respectively.

Meanwhile, the anecdotes Black Book collected from its representatives stationed at nearly 60 sales showed a wide array of activities happening in the lanes. Two of the more informative stories surfaced in the Midwest.

—From Indiana: “Consignment was down, so most everything sold well. New cars have slowed, so dealers are concentrating more on the used side of their business.”

—From Michigan: “The market has shown some softening the last few weeks as high mileage and/or poor condition vehicles have drawn fewer and fewer bids.”

Up in Massachusetts, Black Book’s lane watcher also noticed it was difficult for the hammer to drop on rougher units, relaying, “The market was a little softer this week regarding sold prices. The older vehicles were definitely a challenge.”

Moving South, a recap out of Georgia detailed an upbeat scene as the representative said, “The highline sale was better than expected for a June sale. The values on the sold units were appropriate for the vehicles condition.”

Finally out West, dealers evidently aren’t rolling the dice in the lanes as Black Book’s observer in Nevada stated, “A typical summer market here in Las Vegas as selective mid-size and mid-range valued vehicles prevailed.”

Update on specialty markets

As they do at the beginning of each month, Black Book editors shared their observations of what’s happening in the specialty markets. Here are their thoughts:

—Collectibles: To paraphrase Mark Twain, editors said, “The reports of the demise of the classic American muscle car have been greatly exaggerated. Although muscle cars’ values declined for about a year or so beginning in the summer of 2016, they have since rebounded and are on a yearlong winning streak.”

—Recreational Vehicles: Black Book reported the average selling price of motorized units at auction last month jumped by nearly 10 percent, which equates to roughly $4,000.  

—Powersports: Editors recapped the Powersports market has reached its traditional high point for wholesale values this month, and prices reflect that for most segments.

—Heavy Duty: During June, Black Book noticed heavy duty auction activity surged with more buyers and trucks, while the mileage on the trucks continues to increase and the wholesale values continue to decline.

—Medium-Duty: In June, editors determined that older units (from model year 2007 through 2014) dropped by an overall weighted average of $70 or 0.4 percent, which is $47 less than the adjustment they saw in May. “We did not see too much movement in the older units at auction from Class 3 through Class 6 in June,” editors said.

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