Auction Prices Expected to Fall Between 2014 and 2018

Used-car prices have been moving downward for the majority of 2013 — likely a welcome turn of events for many dealers looking to secure pre-owned inventory.
After dealing with increasingly high prices the past few years as used supply remained low, dealerships may be finding some good news in what the RVI Risk Outlook released for the second quarter of 2013 had to offer.
Though dealers may see used prices rise a bit during the rest of this year, the industry will then begin to see year-over-year price declines between 2014 and 2018, according to RVI Group.
"Used-car prices will rise slightly from current levels through 2014, and then begin year-over-year decreases," the firm's report said.
RVI explained that later this year, used-car supply will begin to increase and carry over from 2014 through 2018, putting downward pressure on used-car prices.
"This, along with higher gas prices and softening new-car prices, will result in softening used-car prices through 2018," RVI explained.
But dealers may have to go through a few months of higher auction prices to see some relief.
In fact, used-car prices saw an increase in May, as spring was wrapping up, when prices rose .9 percent.
That said, prices were still down 1.7 percent year-over-year, last month.
And even though prices are expected to increase before seeing more consistent declines in the near future, rates are significantly lower than the years following the 2008 recession.
Editor’s Note: For more information on where used prices may be headed, see Friday's Auto Remarketing Today.