Wholesale Prices Soften in May

June 13, 2014
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Wholesale prices in May softened from their April spring-market/tax-season peak, although they remain significantly above year-ago levels, according to ADESA. Retail demand, particularly for “certifiable” units for record CPO sales, helped absorb off-rental volume and growing off-lease supply without significant price declines. However, there was some hesitancy from a few sellers to accept May’s lower prices, and this was reflected in low conversion rates for those consignors.

"May’s downturn could be a precursor to further softening, especially in areas such as the Northeast, where the growth in off-lease supply is expected to be concentrated," according to Tom Kontos, executive vice president of ADESA Analytical Services.

According to ADESA Analytical Services’ monthly analysis of Wholesale Used Vehicle Prices by Vehicle Model Class1, wholesale used vehicle prices in May averaged $10,321 - down 1.5 percent compared to April, and up 5.4 percent relative to May 2013. Truck prices continue to generally hold firmer than car prices.

Prices for used vehicles remarketed by manufacturers were down 1.4 percent month-over-month and up 5.0 percent year-over-year, as more off-rental program units entered the market, many of which were no-sold. Prices for fleet/lease consignors were down 1.5 percent sequentially and up 4.2 percent annually, as more off-rental risk units entered the market (although in many cases these too were no-sold) along with more off-lease vehicles. Dealer consignors saw a 2.5 percent average price decrease versus April, and a 3.7 percent uptick versus May 2013, as they wholesaled units obtained in part from trade-ins generated via May’s strong new vehicle sales.

Based on data from CNW Marketing/Research, retail used vehicle sales in May were up 12.3 percent month-over-month and 3.9 percent year-over-year.  Sales of certified pre-owned (CPO) vehicles were a record 207,371 units, up 7.4 percent versus April and up 10.9 percent from the prior year, based on figures from Autodata.

Wholesale Used Vehicle Price Trends
           
  Average Prices ($/Unit) Latest Month Versus:
  May-14 Apr-14 May-13 Prior Month Prior Year
           
Total All Vehicles $10,321 $10,481 $9,796 -1.5% 5.4%
           
Total Cars $9,230 $9,373 $8,934 -1.5% 3.3%
Compact Car $7,266 $7,470 $7,087 -2.7% 2.5%
Midsize Car $8,503 $8,613 $8,192 -1.3% 3.8%
Fullsize Car $7,185 $7,296 $7,240 -1.5% -0.8%
Luxury Car $12,677 $12,563 $12,224 0.9% 3.7%
Sporty Car $13,149 $13,427 $12,849 -2.1% 2.3%
           
Total Trucks $10,892 $10,918 $9,750 -0.2% 11.7%
Mini Van $7,299 $7,310 $6,558 -0.2% 11.3%
Fullsize Van $11,243 $10,921 $9,872 2.9% 13.9%
Mini SUV $12,991 $13,308 $11,053 -2.4% 17.5%
Midsize SUV $8,390 $8,378 $7,164 0.1% 17.1%
Fullsize SUV $10,896 $10,723 $10,580 1.6% 3.0%
Luxury SUV $19,778 $19,582 $18,673 1.0% 5.9%
Compact Pickup $7,705 $7,777 $7,441 -0.9% 3.6%
Fullsize Pickup $13,305 $13,450 $11,810 -1.1% 12.7%
           
Total Crossovers $12,821 $13,222 $12,936 -3.0% -0.9%
Compact CUV $11,589 $11,977 $11,352 -3.2% 2.1%
Mid/Fullsize CUV $14,093 $14,478 $14,537 -2.7% -3.1%
Source: ADESA Analytical Services.
April data revised          

1Wholesale prices in May softened from their April spring-market/tax-season peak, although they remain significantly above year-ago levels.  

Tags: ADESA, Tom Kontos

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