CARMEL, IN – Retail used-vehicles sales worsened in July and this helped drag down average wholesale used-vehicle prices 2.2 percent relative to June – the fourth consecutive monthly drop, said Tom Kontos, chief economist, ADESA Inc. Year-to-date retail used-vehicle sales volumes are now the lowest of the decade, after two consecutive months of double-digit year-over-year declines.

Consignors appear to have been more willing to accept lower July prices, and estimated auction industry sold volumes dropped 2.8 percent year-over-year after dropping 4.6 percent in June. In the absence of last summer’s broad employee discounts on new vehicles, wholesale used-vehicle prices continued to be up on a year-over-year basis, masking the market’s overall softness, reported Kontos.

ADESA Analytical Services continues to expect diminished retail demand until dealers reduce existing used-vehicle inventories through clearance pricing that will help make these units more competitive with discounted new vehicles. Some help from the economy will also be necessary, and the Fed’s first “pause” after two years of rate increases is a step in that direction, said Kontos.