Beggs: Used Inventory to Tighten in Northeast

It seems a few factors on the new-car side of things may impact used-car supply in the coming months, Black Book’s Ricky Beggs contends.
With new-car sales coming in strong through November, with 1.14 million total sales recorded, this past month's new-car sales activity along with Hurricane Sandy-driven inventory replacements will lead to some varying impacts on the used-car market, the Black Book managing editor stressed.
In fact, some industry estimates have pushed the SAAR to 15.6 million, and this means potential trades entering the lots, he said. This would mean continued alleviation in used supply and could help counteract the pricing dynamic spurred by demand in the Northeast.
But the trade-in numbers will likely be much lower in the Northeast, Beggs said. While 60 percent of all new sales include a trade, on average, this trade-in number is expected to be much lower throughout the Northeast, according to Black Book estimates.
Trade-in activity could fall as low as 30 percent of new sales throughout the Northeast, Beggs added.
And dealers may see a uptick in used prices in this area, as well. Beggs said that the falling trade percentage may mean used price increased in the Northeast, as dealers see less inventory from trades and begin to look in other places for used-car inventory.
Delving deeper into used-car price trends, compact cars and sporty cars saw the least price declines this past month, while premium luxury cars and entry-level cars had the biggest price declines. The price changes are as follows:
1: Compact Cars -0.25 percent
2: Sporty Cars -0.34 percent
3: Luxury Level Cars -0.36 percent
4: Premium Luxury Cars -0.67 percent
5: Entry Level Cars -0.77 percent
For trucks, weekly price increases were recorded for compact SUVs, midsize cargo vans and compact crossovers. However, midsize van wagons, midsize crossovers and fullsize van wagons all led the largest price declines for trucks, Beggs shared. The changes are as follows:
1: Compact SUV +0.06 percent
2: Midsize Van Cargo +0.05 percent
3: Compact Crossovers +0.02 percent
4: Midsize Van Wagon -0.43 percent
5: Midsize Crossover -0.51 percent
6: Fullsize Van Cargo -0.77 percent