Strong used-vehicle demand and a sharp decline in retired rental vehicles offered at auction buoyed prices of used cars and trucks in November.
The Manheim Used Vehicle Value Index rose for the second month in a row in November. The index stood at 123.3 in November, up from 121.8 in October and 122.4 in November 2013. The index is adjusted for vehicle model mix, mileage and time of year.
NADA Used Car Guide saw a similar trend in its data, said its analyst, Larry Dixon.
While the supply of vehicles at auction was down overall in November, there was a steep decline in rental-heavy 2014 model-year volume, Dixon said.
After rising an average of 44 percent in September and October, the volume of 2014 model-year cars and trucks offered at auctions — mostly retired rental vehicles — fell nearly 10 percent last month. In November 2013, model-year 2013 volume fell less than 2 percent, NADA Guide data show.
“The strength we saw this November relative to Novembers in the past was due in part to a sharper pullback in rental volume compared to what we’ve seen in past years,” Dixon said.
November’s used vehicle prices suggest that new vehicle sales in September and October — while robust enough to top 16 million on a seasonally-adjusted annualized rate — “did not create the level, or age, model, condition or mix of trade-ins and lease turn-ins that dealers needed for today’s robust used vehicle market,” the commentary accompanying Manheim’s index noted.
“The dealer’s mood in November was one of active acquisition at auction,” the commentary said.
Black Book data showed that the average price of 2009-13 used vehicles in November depreciated 1.9 percent, vs. a 2.0 percent drop in October.