ADESA Canada: Auction Prices Softer than Usual
MISSISSAUGA, Ontario — The ADESA Canada Used Vehicle Price Index declined month-over-month for the sixth straight time during March, and auction prices saw a slim decline during the month, which normally shows a moderate gain.
More specifically, ADESA's data — powered by ALG Canada — indicated that the March index fell roughly 0.1 percentage points (seasonally adjusted) from the prior month.
"Auction values experienced a slight overall decline when typically we would expect a modest pickup," officials indicated.
However, there were bright spots. The mid-compact and midsize car segments, which also happened to be the leaders in terms of volume, saw the strongest resale price gains. Mid-compacts were up 12 percent ($667) from February while midsize cars climbed 7 percent ($554).
On the opposite end of the spectrum, resale prices for midsize SUVs were off 10 percent as they fell $1,413, and compact SUVs saw a 4-percent dip (down $357).
Continuing on, officials noted that the purchasing trends among Canadian consumers is still reflective of consumer confidence gains. This helped push new-vehicle sales to a 14.1-percent year-over-year increase. The impact was also evident in that the month saw the lowest March-over-March drop in the Used Vehicle Canadian Price Index in more than four years.
Moving along, officials also looked at the impact of gas prices.
"The effect of gas prices, hovering on and around the $1.00/liter mark, on the compact segments is evident as their desirability grows as evident in the resale prices, despite the increased volume going through auction," officials shared. "On the other hand, the compact and midsize SUV segments saw volumes up on average 25 percent. But, unlike the compact segments, their resale prices did not experience an accompanied appreciation (month-over-month)."
As far the impact of Canadian-U.S. exchange rate on the market, they added: "At a macro level, with the dollar on top of parity, the Canadian resale market once again sees heightened interest from Canadian dealers/wholesalers in the U.S. for used supply, which will put further pressure on resale prices."