Best first-half auction vehicle sales since 2019 offers ‘welcome relief’ to dealers

It was the strongest first half for auction vehicle sales in seven years.

According to the latest data from the National Auto Auction Association, there were close to 3.7 million vehicle sales at AuctionNet-participating auctions in the first six months of the year.

Not since 2019, when there were 4.2 million units sold in the first six months, have first-half auction sales been that high, NAAA said.

The sales strength has been led by commercial consignor sales, which are up 15.2% year-to-date.

Larry Dixon, NAAA’s vice president of Auction Data Solutions/AuctionNet, attributes the commercial growth to three factors, the first of which is rental fleet activity.

Rental companies are, “right-sizing fleets to match demand and take advantage of current model year, or 2026, units,” Dixon said.

“New sales to rental fleets are up more than 2% YTD, which indicates that we should continue to see modest wholesale sales growth for the group when 2026 units are remarketed later this year and into 2027,” he said.

A second factor is the rise in off-lease volumes. There was a 14% increase (or about 300,000 units) in new lease originations in 2023, and auctions are now showing a similar increase in volumes of 3-year-old vehicles, given that most leases are 36 months.

“Expect off-lease volume to continue trending higher through next year,” Dixon said.

Additionally, there has been an increase in repossessions.

“Delinquencies and defaults have been elevated for several years now, which means that we’ve been in an elevated repossession environment as well,” Dixon said.

It’s a different story for dealer volumes, which fell more than 5% in the first half, NAAA said.

That’s driven by dealers keeping more trade-ins than usual to keep up with demand.

“Note that new- and used-vehicle retail sales are down YTD too, which exacerbates the trade-in issue because fewer retail sales means fewer trade-ins — all else equal,” Dixon said.

Looking at June in particular, there was a 5.5% increase in overall auction sales, selling-day-adjusted, which was the best year-over-year gain in 11 months, NAAA said.

There was an 18% year-over-year increase in commercial sales during June, though they did fall 9% month-over-month, selling-day-adjusted.

Breaking the June data down by age group, there was a 16% increase in 1-year-old vehicle sales in June, following five months where the average annual hike was 39%, NAAA said.

There was 27.2% growth in the off-lease-heavy 3-year-old vehicle contingent during June, following 24% growth in May. This was driven by strong commercial sales.

“The expanding supply of late-model, lower-mileage vehicles should provide welcome relief for dealers facing ongoing inventory shortages,” Dixon said.

Note: This is part of a monthly series in which Auto Remarketing shares AuctionNet data and commentary provided by the National Auto Auction Association.

As noted by the organization, more than 260 NAAA member auctions power AuctionNet, making it the most comprehensive source of wholesale auto auction sales data in the U.S. Unless otherwise noted, auction sales figures are based on total reporting auctions, the number and composition of which may vary over time.  Data below courtesy of AuctionNet/NAAA.