Auction volume approaches 320K in October
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Auction volume continued on an upward trajectory last month, following a trend the industry has been watching for most of the year.
According to the latest Guidelines report from NADA Used Car Guide, auction volume of vehicles up to 8 years old jumped up by 4 percent over the four-week period ending Oct. 26. This increase pushed volume to 319,000 units.
Looking at specific model years, volume of 2013 vehicles (55,000) spiked by 11 percent, while model-year 2015 (41,000) unit volume shot up by 34 percent.
Model-year 2012 and 2014 units, on the other hand, saw declines of 2 percent and 7 percent, respectively. Volume for the remaining model years was “flat-to-up slightly,” Jonathan Banks, executive automotive analyst at NADA UCG, said in the report.
Overall, year-to-date volume stands at 3.52 million units, which is up 4 percent year-over-year.
Expanding supply is putting downward pressure on used prices. According to Kelley Blue Book data, auction values reached a two-year low in the third quarter.
“While auction values are maintaining a two-year low, we’re not seeing anything out of the ordinary from a valuation perspective,” said Sean Foyil, analyst for Kelley Blue Book. “Auction volume has consistently been up this year when compared to previous years, and that means more supply in the lanes, which can ultimately cause values to soften.
And auction volume increases aren’t expected to slow down anytime soon.
You can probably expect around an 800,000-unit increase in lease maturity volume next year, according to Joe Derkos, senior director, consulting and analytics at J.D. Power and Associates