Black Book: Wholesale Patterns Reflect Possible Demand from Remodelers & Builders


The housing market continues to see improvements from the recession slump, and this trend may be affecting the automotive industry, as well. With more homes being built, it seems demand is also on the rise for some vehicles often used in construction projects.

According to Black Book, a review of December used-car and wholesale auto patterns shows noticeable price increases for full-size cargo vans and wagons, “indicating possible demand from remodelers and builders.”

In fact, since the end of November, full-size wagons increased wholesale prices by an average of 0.60 percent, and full-size cargo vans increased by an average of 0.47 percent.

This trend, perhaps related to construction rates, is offset by downward movement in the smaller segments.

On the opposite side, midsize wagons saw the biggest drop in prices, falling by an average of 0.45 percent as well as full-size crossovers at (down 0.35 percent.)

Midsize crossovers (down 0.32 percent) and mid-size SUVs (down 0.31 percent) weren’t far behind, Black Book officials added.

Moving even smaller, it seems most of the car segments fell slightly this past month, as well.

But the compact cars saw the most stable month this past December, losing an average of just 0.23 percent.

Conversely, the upper midsize cars saw the biggest price drops among cars, averaging a decline of 0.46 percent. They were followed by full-size cars  (which were down 0.42 percent).

Black Book also touched on a few remarketing trends dealers should keep their eye on in the next few months.

First, the company explained it will continue to have a “watchful eye” on lease-heavy segments such as premium luxury and luxury-level cars, “as off-lease activity begins to impact wholesale auto demand, and additional debt ceiling talks possibly impact on luxury-level spending.”

Next, Black Book contends strong new-car sales activity will continue to have a downward pricing impact on used cars moving forward.

“Maybe the interest and level of new sales was the major driver holding back the used wholesale activity of the most recent week,” said Ricky Beggs, managing editor of Black Book. “More new sales equals more trade-ins which equals less additional sourcing for used inventory.”

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