Chart courtesy of Black Book

Chart courtesy of Black Book

Small cars are making a comeback to open the year, and Black Book believes the segment could be in for a good spring.

Model-year 2008-2014 subcompact, compact and mid-size cars showed the lowest depreciation last week, with their wholesale values declining 0.23%, 0.26, and 0.25% respectively, according to Black Book's Jan. 10 Market Insights report.

“Smaller cars are back in demand at the start of the new year,” said Anil Goyal, senior vice president of automotive valuation and analytics for Black Book. “We expect a good spring season this year for such vehicles.”

Volume weighted, overall car segment values decreased by 0.45% last week, lower than the average depreciation rate of 0.56% recorded during the previous four weeks. Showing the biggest declines last week were the sport car, luxury car, premium sport car and prestige luxury car segments, which decline by 0.87%, 0.72%, 0.72%, and 0.71% respectively.

“Sporty cars show higher declines due to seasonality,” Goyal noted.

Volume weighted, overall truck segment values, including pickups, SUVs and vans, decreased by 0.51% last week, which was in line with the average depreciation rate of 0.51% recorded during the previous four weeks. The subcompact crossover, full-size crossover, and midsize crossover segments declined the most, falling 1.36%, 0.88%, and 0.85% respectively.

Additionally, retention trends for three-year-old compact crossover/SUVs have been strong recently, the firm noted in its monthly report. “Relatively, the supply will be higher this year along with more competition from new-vehicle incentives,” the firm stated in its report. “We expect this strong retention to soften this year, which is reflected in our residual forecasts.”

Editor's note: This story originally appeared on F&I Showroom, which is a Bobit Business Media publication.

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