In September, overall used-vehicle prices fell for the fifth month in a row, but prices of used pickups rose sharply.
It’s all part of a healthy overall market, said Tom Webb, chief economist at auction giant Manheim.
The pricing changes reflect “a reversion back to trend levels after an extended period of exceptionally strong pricing, increased wholesale supply and some moderation in retail demand,” Webb told analysts and reporters during a conference call.
Overall used-vehicle prices were down 1.1 percent in September from a year earlier, but that masked large variations by segment.
Prices of used compact cars — a segment Webb said was weighed down by fierce competition on the new-vehicle side, customer defections to compact crossovers and lower gasoline prices — fell 3.4 percent.
Prices in the used luxury-car segment, fed by a steady stream of off-lease vehicles right through the recession, fell 3.0 percent.
Conversely, used pickups were buoyed by the housing, construction and oil-and-gas industries and tighter overall supplies. The average price of vehicles in that segment shot up 6.5 percent in September.
“That’s a supply that really dried up,” Webb said of used pickups. “They typically are not leased; they are held for a long time, and they don’t come back into the market.”
The changes in used-vehicle prices largely mirror trends in new-vehicle sales. In September, sales of new pickups rose 19 percent amid an industry wide 9 percent gain, while sales of new compact cars fell 1 percent. Sales of new luxury cars rose 4 percent in September.
Webb predicted that the number of off-lease vehicles entering the market will increase by about 20 percent from 2014 through 2016. That uptick will cause used-vehicle prices to fall but won’t cause them to collapse, he said.
The Manheim Used Vehicle Value Index stood at 121.4 in September, down from 121.8 in August and 122.8 in September 2013. The index measures changes in used-vehicle prices and is adjusted for model mix, mileage and time of year. It started in January 1995 at a base of 100.