Used Car Prices Archives | Page 22 of 30 | Auto Remarketing

Lane watch: Falling gas prices impacting compacts

AAA reported on Monday that the nationwide average price for a gallon of gas stood at $2.38 with some locations like Texas, Oklahoma and Mississippi approaching the $2 mark. That’s the lowest cost at the pump in more than a year, according to AAA.

As a result, Black Book is seeing values for fuel-efficient vehicles soften, especially compact cars. Black Book vice president of automotive valuations Laura Wehunt elaborated about the trends in this week’s Market Insights report released on Tuesday.

“As prices at the pump continue to trend downward, we are seeing the price-sensitive compact and mid-size car segments trending downward also,” Wehunt said in the report.

Black Book’s volume-weighted information showed overall car segment values decreased by 0.11% this past week. The downward movement comes on the heels of three out of the previous four weeks when analysts noticed value upticks for cars.

Those compact cars paced the declines as Black Book pegged it at 0.44%.

“Compacts had a strong January, but decreased in value throughout the majority of February and appear to be following the same pattern for March,” analysts said.

Again according to volume-weighted data, Black Book determined overall truck segment values (including pickups, SUVs, and vans) edged lower by just 0.03% last week, consistent with the 0.01% truck depreciation reported during the prior week.

In contrast to cars, analysts indicated the compact and sub-compact crossover segments both experienced week-over-week gains, climbing 0.15% and 0.29%, respectively.

Turning next to observations from Black Book’s representatives stationed at nearly 60 sales nationwide, the anecdotes reflected what many dealers might be experiencing. Here is the rundown:

— From Georgia: “The attendance was OK, but the sold rate was down and was most noticeable in the dealer lanes. One of the ringmen stated that the floors seemed high, and they weren’t willing to lower them.”

— From Michigan: “The wholesale market is showing very small signs of improvement which is mirroring our retail market.”

— From California: “There is such a heavy demand for the high CR vehicles that most of them sell for really strong money.”

Will gas prices suddenly reverse, making those fuel-efficient vehicles more attractive to potential buyers? AAA isn’t suspecting such a development at the pump arriving soon.

“Crude prices plunged at the end of last week after OPEC and other major crude producers, including Russia, failed to set a new production reduction agreement amid mounting global crude demand concerns caused by COVID-19,” AAA said in a news release. “The rapid decline in crude prices has increased market concerns that an oil price war may breakout this week between major crude producers, contributing to further economic troubles worldwide as crude prices continue to drop dramatically.

“Moreover, the market continues to worry that the impact of COVID-19 will lead to a reduction in global economic growth and global travel with crude demand expected to decrease,” AAA continued. “Until it appears that the international public health threat from the virus decreases, crude prices are likely to continue facing significant downward pressure.”

Some ‘surprising’ elements surface in Black Book’s February index

While the overall reading made just a modest rise month-over-month, Black Book spotted a couple of elements within its February Used Vehicle Retention Index that analysts deemed to be a bit “surprising.”

This week, Black Book released its latest index update, reporting that the overall reading from February came in at 115.2, representing a rise of only 0.7 points from the January market of 114.5.

“The overall index was positive, and the month-over-month change had all segments increasing except small pick-ups,” Black Book senior vice president of data science Alex Yurchenko said in a news release.

“The surprising change was the near-luxury car and luxury car segments that had the largest month-over-month change; however, these were no change and lower, respectively, on a year-over-year basis,” Yurchenko continued.

The Black Book Used Vehicle Retention Index is calculated using Black Book’s published wholesale average value on 2- to 6-year-old used vehicles, as a percent of original typically equipped MSRP. It is weighted based on registration volume and adjusted for seasonality, vehicle age, mileage and condition.

The index dates back to January 2005 when Black Book published a benchmark index value of 100.0 for the market. During 2008, the index dropped by 14.1% while during 2016, the index fell by just 6.4%.

During 2011, the index rose strongly from 113.3 to 123.0 by the end of the year as the economy picked up steam and used vehicle values rose higher. It continued to remain relatively stable, rising slightly until May of 2014 when it hit a peak of 128.1.

 To obtain a copy of the latest Black Book Wholesale Value Index, go to this website.

Lane watch: Values for in-demand units on the rise

Dealers are on the hunt for inventory that matches potential-buyer preferences as we continue toward spring. As a result, the latest Black Book Market Insight report details price moves on those more popular units, including trucks and SUVs as well as sporty cars and luxury models.

Black Book vice president automotive valuations Laura Wehunt — one of three executives recently promoted — said, “After months of strong luxury depreciations, we finally saw a positive adjustment for some of the luxury car and truck segments this past week.”

According to volume-weighted information contained in the newest report, Black Book reported overall car segment values increased by 0.05% this past week. Analysts pointed out this movement represented the largest positive change since the end of August, which the segment ticked up by 0.06%.

Black Book also noted sporty Cars are continuing their upward momentum with another increase of 0.28%. A week earlier, these vehicles rose by 0.38%.

Again looking at volume-weighted data, Black Book noticed overall truck segment values (including pickups, SUVs and vans) edged 0.01% lower last week.

Among trucks, analysts mentioned the sub-compact crossover segment increased for a fourth week in a row.

Turning next to what Black Book representatives stationed at nearly 60 sales nationwide, lane watchers captured anecdotes that might also be experienced by other used-car managers. Here is the rundown:

— From Pennsylvania: “Dealers are buying for inventory as the retail demand increases. Passenger vehicles were not in demand here today.”

— From Massachusetts: “The high-volume consignors said the money was good and in most cases an improvement from last week.”

— From Maryland: “I saw several passenger vans sell today for strong money. As for the SUVs in the sale today, the compacts sold the best.”

— From Georgia: “Trucks and SUVs sold at a high percentage. I made note of the fact that a great number of these units had low CRs and high mileage.”

Kontos: 2020 ‘starts with a bang’

Tom Kontos succinctly summarized his opinion about how the wholesale market behaved to begin 2020.

“The new year started with a bang as wholesale used vehicle prices were up on both a month-over-month and year-over-year basis in January,” the KAR Global chief economist said in his latest installment of the Kontos Kommentary.

“Just as in previous months, however, overall prices for the car segments were softer than for the truck segments,” Kontos continued.

According to KAR Global Analytical Services’ monthly analysis of wholesale used-vehicle prices by model class, analysts determined wholesale prices in January averaged $11,096, representing a 2.5% lift compared to December and a 3.1% rise versus January of last year.

“Average prices were again down on a year-over-year basis for car segments in total, while they were up overall for the truck segments,” Kontos said.

“The reverse was again true for midsize cars versus midsize SUVs/crossovers in the off-lease market segment as the former may be in short supply due to dealers preferentially obtaining midsize cars upstream and leaving fewer of these units available for buyers at physical auction,” he went on to say.

Kontos offered a deeper dive those particular off-lease units, holding constant for sale type, model-year-age, mileage and model class segment. KAR Global found prices rose on a year-over-year basis for both midsize cars and midsize SUV/CUVs that fit into this wholesale bucket — roughly 3 years old and less than 45,000 miles.

Prices for those particular midsize cars climbed 7.0% or $834 year-over-year in January to $12,702, while prices for those specific midsize SUV/CUVs edged 1.0% or $203 higher to $20,524.

Kontos went on to mention average wholesale prices for used vehicles remarketed by manufacturers in January slid 3.0% month-over-month but increased 7.1% year-over-year.

He added that prices for fleet/lease consignors in January jumped 3.2% sequentially and 5.9% annually.

Finally, Kontos pointed out that average January prices for dealer consignors increased 1.8% versus December and 3.5% relative to January of last year.

Source: KAR Global Analytical Services.

Lane watch: Notable spring-market signs appear

For used-car managers who watch for a sharp wholesale price jump in sporty cars as a sure tell that the spring market is taking hold now have confirmation thanks to the newest Black Book Market Insights report.

Black Book reported that values for sporty cars increased 0.38% percent this past week, mirroring the rise generated by luxury cars. Analysts indicated increases for full-size cars (up 0.34%) and near-luxury cars (up 0.26%) weren’t far off that pace.

“Signs of spring are continuing to show on the auction lanes as sentiments are positive and values are strong,” Black Book principal automotive analyst Laura Wehunt said in the latest report.

That car pricing activity pushed the overall volume-weighted reading up by 0.02%. A week earlier, car values softened by 0.11%.

Over in the truck space, Black Book reported that its volume-weighted data showed that overall truck segment values (including pickups, SUVs and vans) dipped by just by 0.08% last week.

Analysts noticed that values of the affordable sub-compact crossover segment increased for the third week in a row, climbing by 1.24% this past week.

More indications of the spring market taking hold arrived via the anecdotes shared by Black Book representatives stationed at nearly 60 sales each week. Here is the rundown:

—From California: “We had a very strong sale with lots of dealers left scratching their heads over the high bids.”

—From Tennessee: “The market is improving with pick-ups and compact SUVs leading the way.”

—From Indiana: “Retail has improved here pushing the auction prices up. Anything nice will bring the money.”

—From Arizona: “Dealers are commenting that the strong economy, tax season and spring weather are coming together for a really good market the next few months.”

Lane watch: Early spring signs show shift to trucks & SUVs

After loading up on cars during the first few weeks of 2020, dealers appear to be turning their inventory-management attention to trucks and SUVs.

Data and anecdotes from representatives working the lanes contained in the newest Black Book Market Insights report offered more details as the spring market begins to show stronger indications of arrival.

“This week, cars took a backseat to trucks and SUVs as the larger vehicles showed their first real signs of spring-market strength,” Black Book executive vice president of operations Anil Goyal said in the latest report.

According to volume-weighted data, Black Book determined overall car segment values decreased by 0.11% this past week. That reversed the prior week’s movement, which included an uptick of 0.04%.

After four weeks of increases, analysts noticed the midsize car segment leveled off and decreased by 0.14%.

Looking again at volume-weighted information, Black Book reported overall truck segment values (including pickups, SUVs, and vans) softened by just 0.03% last week. Analysts indicated this dip is the smallest week-over-week change since last May.

In the truck world, Black Book mentioned values of the affordable sub-compact crossover segment continued an upward pattern as they now have climbed four out of the past five weeks.

As far as what Black Book representatives shared from attending nearly 60 sales nationwide, the highlights included that shift toward trucks and SUVs. Here is the rundown:

— From Indiana: “Had a lot of off-lease and rental units in the sale today and they all sold pretty well. Prices seem to be experiencing an uptick.”

— From Tennessee: “Crossovers were hot today. Dealers tell me that January was just OK, but February has started off better.”

— From Pennsylvania: “We had higher sales percentages this week with SUVs and trucks leading the way.”

— From Georgia: “The sale rate was down to around 50%, but the vehicles that sold brought strong money.”

Lane watch: Spring-market atmosphere intensifies

While it still might be a mixed bag for some dealerships on the retail front as we approach the midpoint of February, Black Book already is seeing managers pad their inventories to be ready when customer activities warm up like the thermometer reading.

According to the latest installment of the Black Book Market Insights report, car values moved counter to what they had done in both December and January, triggering Black Book executive vice president of operations Anil Goyal to make this assertion.

“It looks like the spring buying is already in full swing,” Goyal said. “Dealers are bidding up prices on car segments with even the sporty cars getting an early interest.”

The latest report indicated that based on volume-weighted information, overall car segment values increased by 0.04% to start the month of February. In January, analysts noticed that values averaged a decline of 0.21%. The December average decline was even higher at 0.78%.

Among cars, Black Book mentioned the midsize segment appreciated for a fourth week in a row.

Over with trucks, analysts said their volume-weighted data showed that overall truck segment values (including pickups, SUVs, and vans) decreased by 0.19% last week. That’s nearly the same as the four-week average, which was 0.18%.

Looking deeper at trucks, analysts determined values of subcompact crossovers continued on an upward pattern, increasing three out of the last four weeks.  

Beyond the data, Black Book’s representatives stationed in the at nearly 60 sales nationwide provided a more vivid glimpse at what dealers are encountering — both trying to secure inventory and retailing vehicles. Here is the rundown:

— From Indiana: “The market seems stable. One dealer commented that his retail was pretty good, but he is challenged by the quality of the trade-ins he is receiving.”

— From Massachusetts: “The dealer lanes enjoyed good activity today, which brought a welcome change. The money was strong for commercial accounts, as well.”

— From Wisconsin: “Dealers are reporting that their showrooms are very quiet which is not abnormal for early February in Wisconsin. We had a lot of no-sales as sellers raised their floors, knowing that dealers are trying to build inventory.”

Lane watch: Acceleration toward spring market slows

After lane activity seemed to be accelerating quickly toward spring-market conditions, Black Book noticed auction atmospheres throttled back down a bit, according to the latest installment of its Market Insights report.

The value trends analysts discovered — coupled with anecdotes from representatives in the field — prompted Black Book executive vice president of operations Anil Goyal to say, “The overall market remains steady.

“Values of mainstream midsize cars experienced a slight increase last week,” Goyal added in the newest report.

While those midsize cars edged up 0.15% or $13, Black Book reported that its volume-weighted data showed overall car segment values decreased by 0.21% last week. That figure exactly mirrored the four-week average analysts computed.

Countering the uptick for midsize cars, Black Book indicated sporty car values decreased the most, sliding by 1.17% or $162. Prestige luxury cars (down 0.83%), subcompact cars (down 0.58%) and full-size cars (down 0.52%) each softened noticeably, too.

Black Book’s volume-weighted truck data showed overall values segment (including pickups, SUVs, and vans) dipped by 0.18% last week. That’s half of the four-week average decline of 0.36%.

Analysts pointed out subcompact luxury crossover declined the most, dropping by 0.75%. Conversely, Black Book spotted rises for minivans (up 0.38%) and compact vans (up 0.34%).

Moving on to what Black Book representatives at nearly 60 sales nationwide shared, the anecdotes reinforced reasons for the values movements. Here is the rundown:

— From Texas: “The consignment was lower today, which resulted in dealers complaining about higher prices.”

— From Michigan: “Both wholesale and retail are soft here. A good amount of the buying at the auctions are from out of state buyers.”

— From Missouri: “Prices were strong early regardless of condition, but as the sale continued bidders were dealing with higher floors. SUVs and full-size trucks dominated the sale.”

New TrueCar ‘consumer experience’ geared toward broader audience

TrueCar has launched what it describes as a new consumer experience and strategic rebrand, including an improved used-car experience with enhanced price ratings that the company says provide “more precise used-vehicle price context for consumers.”

That used-car experience also includes free condition history summaries and an improved matching algorithm that brings more relevant used-car inventory to consumers.

To bring more flexibility for car shoppers looking for price clarity and convenience, TrueCar has expanded its product offering to include vehicle discovery tools and the ability for consumers to choose how many certified dealers they want to connect with in addition to the upgraded used car experience.

In addition to the updated shopping experience, TrueCar is featuring a new brand and visual identity that the company has rolled out in a national advertising campaign targeting new audiences.

TrueCar interim chief executive officer and president Mike Darrow said the consumer experience changes, the refreshed brand and new advertising creative “will make TrueCar more appealing and relevant to new audiences, particularly women and millennials.”

He said the digital native car buyers of today are “accustomed to buying almost everything through an online platform.”

“So giving consumers more convenience and choice is at the heart of this change,” Darrow said in a news release.

He continued, “We believe this will result in more productive interactions between consumers and dealers and a better experience through our platform.”

TrueCar said it was launching the new consumer experience and strategic rebrand in response to “changing consumer needs in a digital world.”

In addition to the improved used-car experience, TrueCar’s new consumer experience includes personalized connection features that provide consumers choice in how many dealers connect with them.

The “experience” also features new vehicle discovery tools that can help consumers identify the vehicle that best suits their needs.

The new consumer experience also includes what the company says is a significant evolution of TrueCar’s new-car price ratings that could empower consumers.

The company conducted product testing prior to launch, and it showed that providing consumers choice in how many dealers they connect with resulted in a more-than-100% increase in customer satisfaction, higher consumer response rates from dealer outreach, higher closing introductions between consumers and dealers, and a substantial reduction in consumer feedback around dealer outreach.

TrueCar says that its product has provided prospective car buyers rich data for price context and upfront and transactable price offers on actual dealer inventory for 15 years. That includes a trade product that the company introduced at the end of 2018.

Now, vehicle discovery tools that include vehicle rankings, a trim compare tool, and model overview pages are part of the updated consumer experience. That is geared toward those who are at an earlier stage in their car-buying journey.

Along with new re-engagement tools, TrueCar said the features will “nurture consumers within the TrueCar ecosystem.” That could increase the likelihood of a vehicle purchase or trade-in at a TrueCar network dealer.

TrueCar partnered with design company Pentagram on its new brand identity, strategy, and design direction, which includes the new logo, color palette and brand taxonomy.

The work also included a rebrand of TrueCar’s subsidiary, ALG. That provides a stronger visual connection between the two brands for the first time.

 “It’s vibrant, it’s joyous, and it’s the embodiment of our aspiration to create a world where shopping for a car is uplifting,” said TrueCar chief brand officer Lucas Donat.

Donat continued, “Our goal for the rebrand was a return to visual differentiation in our segment, with a lens toward attracting more women and millennial buyers. Despite what you might hear, millennials are buying cars at greater proportions than ever before, and women make or influence 82% of car buying decisions.”

Darrow said, “It’s a new day for TrueCar, and we’re excited to return to innovation to drive our growth.”

He continued, “From here, you’ll see TrueCar continue to innovate and evolve our product offering in ways that personalize the car buying journey for today’s digital consumer, making it simpler and more convenient, all while enabling more purchase-ready consumers to connect with our dealer partners and their inventory,” Darrow said.

Kontos sees wholesale market experiencing ‘fatigue’ to finish 2019

Perhaps you, too, finished 2019 a bit tired; the culmination of a year filled with automotive activities that left you feeling fatigued.

Well, KAR Global chief economist Tom Kontos explained how the wholesale market might have sustained “fatigue” by the time this past year ended, as well.

According to KAR Global Analytical Services’ monthly analysis of wholesale used-vehicle prices by model class released on Tuesday, analysts found that wholesale prices in December averaged $10,822 — down 0.9% compared to November but up 1.9% relative to December 2018.

Kontos indicated 2019 ended with average wholesale prices dropping for the seventh month in a row. 

“Though some of this decline reflects seasonal patterns, it may also be indicative of used vehicle market ‘fatigue’ after many months of admirably withstanding used-vehicle supply growth without significant deterioration in values,” he said in the latest installment of the Kontos Kommentary.

KAR Global’s information showed average prices for cars softened year-over-year, but overall average truck prices moved higher.

“Compact SUV/crossover prices appear to be softening after several years of strong new-vehicle sales and model proliferation,” Kontos said.

As he does regularly, Kontos elaborated about 3-year-old midsize cars and midsize SUV/CUVs with less than 45,000 miles — using criteria that characterize off-lease units. When holding constant for sale type, model year, mileage and model class segment, Kontos discovered prices jumped in both categories.

For those particular midsize cars, prices jumped 5.6% or $616 to $11,601, whole for those specific midsize SUV/CUVs, prices rose by $325 or 1.7% to $19,298.

Looking elsewhere in the wholesale market, KAR Global found that average wholesale prices for used vehicles remarketed by manufacturers in December slid 2.3% month-over-month but climbed 7.4% year-over-year. 

Analysts noticed prices for fleet/lease consignors in December ticked up 1.2% sequentially and 4.6% annually. 

Furthermore, KAR Global reported average prices for dealer consignors edged 0.3% higher in December versus November but remained flat relative to December 2018.

Kontos closed his latest update by recapping retail activities.

Based on National Automobile Dealers Association data, Kontos indicated retail used-vehicle sales by franchised and independent dealers decreased 11.2% month-over-month and 1.7% year-over-year in December. On a full-year basis, he added that sales moved 1.6% higher.

As previously reported by Auto Remarketing, Kontos also mentioned that December certified pre-owned sales edged 0.7% lower from the prior month but climbed 5.3% higher year-over-year, according to figures from Autodata.  On a full-year basis, Kontos pointed out CPO sales in 2019 increased by 4.1% versus 2018.

Source: KAR Global Analytical Services.