Depreciation in auto auction lanes closer to historical average as 2023 closes
During the last week of 2023, prices remained fairly steady in the auto auction lanes, with an average decline of 0.55%, according to the latest weekly report from Canadian Black Book.
That said, none of the 22 segments that CBB tracks saw an increase in value.
Cars and truck value movement was balanced, the report said. Car prices fell by 0.53%, and truck values were down 0.55%.
The biggest depreciation was seen in the minivan segment with a drop of 1.59%, followed by full-size crossover/SUVs with a drop of 1.36%.
Covering the car segments in detail, the decrease was seen across all nine segments at different rates. The largest drops were seen in the compact car segment with a drop of 1.20%. Subcompact cars (down 0.72%) and midsize cars (down 0.70%) also saw larger-than-average declines. The full-size cars performed the best with a slight drop of 0.11%.
Trucks and SUVs have seen heavier deprecation for most of 2023 than cars, but both sectors dipped a bit this week. The aforementioned minivan segment was the biggest drop for trucks and SUVs, followed by full-size crossover/SUVs with a drop of 1.36% and subcompact luxury crossover/SUVs with a drop of 1.16%. Full-size pickups, midsize crossover/SUV and full-size van segments also saw declines slightly higher than the average.
Although the Canadian market continues to see declines in value, CBB analysts said the overall decrease slowed during the holidays with declines closer to the historical average.
“Supply is building with decreasing demand for vehicles at auction on both sides of the border,” CBB said in its weekly report. “Upstream channels continue to tap supply before it can be available to wholesale markets.”
Most segments did see a change in average value of more than $100 this week.
Conversion rates were quite low this past week with some observed sell rates as low as 4% and as high as 56%, according to CBB, but most were less than 35%.
“Last week we saw less sellers dropping floors, which has been contributing to lanes with lower sell rates,” CBB said.
For comparison, in the U.S. market, last week car and truck segment prices fell by an average of 0.68%, after falling by 0.70% the week prior.
Volume-weighted car segments decreased 0.51% last week in the U.S., while volume-weighted truck segments fell by 0.80%.