Used Car Values Remain Strong


I often talk on the CarProUSA radio show that I try to monitor used car prices every Wednesday at the Manheim Dallas auction VIA simulcast. I keep being amazed by the prices of SUVs and pickups. It is important to note this is a dealer-only auction. This week, Manheim released its June results and used prices are holding steady.

According to their report, wholesale used-vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) increased 0.61% month-over-month in June. This brought the Manheim Used Vehicle Value Index to 140.5, a 4.1% increase from a year ago.

After seeing steady and slightly lower than normal depreciation in weekly Manheim Market Report (MMR) prices in May, prices remained firm or slightly higher each week in June.

Three-year-old vehicle values in aggregate saw an increase of 0.4% for the month, which was slightly stronger than last year's performance. Prices in aggregate remain lower than at the beginning of the year, but non-luxury prices remain higher. Luxury vehicle prices, which had seen abnormally high depreciation this year through May, also saw slight price appreciation in June.

On a year-over-year basis, all major market segments saw seasonally adjusted price gains in June. Midsize cars and pickups outperformed the overall market, while most other major segments underperformed the overall market.

"From a retail sales perspective, the used car market continues to outperform the new market," said Jonathan Smoke, chief economist for Cox Automotive, parent company of Manheim. "While we are past the busiest time of the year, a strong used market has continued into summer due in large part to the record number of late-model off-lease vehicles available that provide an affordable alternative to expensive new vehicles. Used vehicle price movement in June indicates that demand for 'gently used' vehicles exceed supply."

U.S. Vehicle Sales

According to Cox Automotive estimates, used-vehicle sales volume was down 3.0% year-over-year in June. They estimate the seasonally-adjusted annual rate (SAAR) in June was 39.8 million, down from a sales pace of 41.1 million last June but up from May's 39.2 million pace. Last year is a tough comparison for the month as the used-vehicle market experienced an abnormal increase in consumer demand during the summer driven by tariff fears and rising interest rates.

Similar to the used-vehicle market, the new-vehicle market was soft in June. New-vehicle sales volume in June was down 2.5% year-over-year, with one less selling day compared to June 2018. The June SAAR came in at 17.3 million, improving versus last year's 17.2 million but down slightly from May's 17.4 million rate. Cars continue to see declines, as sales in June fell 8% compared to last year. Light trucks outperformed the market in June, finishing the month up 1% year-over-year.

Combined rental, commercial and government purchases of new vehicles were up 5% year-over-year in June, but down 11% month-over-month. Fleet sales have been strong throughout the first half of 2019, as the market is on course to deliver the highest volume of fleet sales in history. The rental fleet channel was up 11% year-over-year in June. Retail sales of new vehicles, on the other hand, were down 3% in June, leading to a retail SAAR of 14.1 million, down from 14.3 million last June.
Related Articles
Real-Time
Real-Time Weather Brought To You By Toyota
Sometimes you wonder why someone didnít think of really smart idea sooner. This is one of those things.

Toyota is teaming up with Weathernews on a new research project to improve forecasts by ... More ›
Rest
Rest In Peace: These 30 Vehicles Are Going Away
As they say, all good things must come to an end and that is true of vehicles, too. The death list of 2020 models is pretty extensive, more so than I recall in a while.

I get the question a l... More ›
2019
2019 Texas Truck Rodeo: Comparing the Finalists
Thereís perhaps no better setting than the Texas Hill Country for an event that automakers and automotive journalists look forward to every year, and that is the Texas Truck Rodeo. Though the event is... More ›
2020
2020 Nissan Armada Platinum Reserve VS 2020 Toyota Sequoia TRD Pro
Dirt, logs, inclines and a little bit of mud thanks to Mother Nature are the perfect recipe for a little off-road competition -- as was the case at this yearís Texas Truck Rodeo, an event held by the ... More ›
There haven't been any comments left on this blog yet. Be the first to add one!.