Black Book: Wholesale Market Becomes Steady
GAINESVILLE, Ga. — The wholesale market appears to be "stabilizing," according to recent analysis from Black Book managing editor Ricky Beggs. He said that last week was only the second time in about three months that less than half of Black Book's wholesale adjustments were positive.
"Results from the auctions, combined with the editors' in-depth analysis during the last week, have indicated a stabilizing market," he explained in the latest Beggs on the Used Market report.
Beggs noted that "comments from several of the Black Book survey personnel who attend the auctions and capture pertinent and valuable market information, such as 'prices seemed to have leveled off' to 'sellers nor buyers would bend to get the deal done,' verify the overall market changes going down about $21," Beggs continued.
There were also some other "pertinent comments" from the company's survey personnel that Beggs said were quite interesting and indicate challenges for dealers and the overall used market. These were found on both the West and East coasts.
"The 'quality of the cars on the lanes is really down' was overshadowed by 'not any clean cars at the auction today' from a different survey person, indicating that good Extra Clean and Clean vehicles, that are taken in on trade, are being held for retail in most cases," he noted.
The proportion of daily adjustments that were positive stood at 47 percent, he noted. In the 13-week period from the week ending Feb. 19 through Friday, there was only one other week where Black Book's positive adjustments represented less than half of the total changes.
"At the same time with fewer increases in values, we also made the largest number of vehicle adjustments on a daily basis with over 1,650 per day since the week ending March 19, 2010," Beggs pointed out.
"In addition to this significant number of daily adjustments, there were over a dozen additional 2010 models priced with market driven value information," he continued. "We were also able to include values for some very limited volume 2009 models this past week. Please look for these previously empty spots, now having accurate market driven information to assist your buying and selling needs."
As far as vehicle categories, the prices of the 10 car segments that Black Book monitors showed an overall dip of $10, while the prices of the 14 truck segments climbed $14.
Among individual segments, entry-level cars and entry midsize cars had price declines for the third consecutive week, but the entry sporty car segment showed price improvement for the ninth straight time and prices for premium sporty cars jumped for the fifth straight week.
"It's a spring and summer market based on this segment trend," Beggs suggested.
Meanwhile, eight truck segments experienced price gains, four of which have been on the incline for 11 straight weeks: compact crossover utility vehicles, midsize SUVs, full-size pickups and minivan wagons.
Not to mention, midsize pickups have shown price gains for eight straight weeks.
"More detailed insight into the full-size pickup market shows greater strength within the 3/4- and one- ton pickups and especially those with diesel powertrains," Beggs noted. "Check out the ADD amount for the diesel engine with these vehicle listings.
"The main driver is a lack of supply. Do a search of auction and retail listings and good luck in finding the right unit," he added. "Is this also a possible sign of an improved economy and some construction type work starting to pick up?"
Moving along, Beggs went on to mention several industry events in which he participated over the last week, including Auto Remarketing's Automotive Economic Forecast & Financial Forum held May 10 through May 11 in Chicago.