GAINESVILLE, GA – The last several days have seen the implementation of CARS (or the Cash for Clunkers program) and talk of a subsequent suspension after less than a week. The interest has been tremendous for dealers and from consumers, according to Ricky Beggs, VP & managing editor at Black Book.
“The real question is how close are we to having enough deals initiated to use all of the allocated funds?” asked Beggs. “For all those deals that did qualify for the program, there were some that didn’t, but still ended up with consumers being a new car owner or maybe a ‘new’ used-car owner. Those non-qualifiers undoubtedly created some inventory for the used car lot or another unit for the auction lanes.”
This past week, four of the 10 car segments were up and, except for the premium sporty car segment, the increases were larger than the decreases, thus the overall car segment increased again this week. This is a trend that has been on the positive side for the past nine weeks, according to Black Book. The trucks had 12 of the 14 segments holding the line or increasing this past week. Only the compact SUVs and compact pickups decreased at -$6 and -$4 respectively.
“An interesting note is that only two segments, the mid-size crossovers and luxury SUVs, had gains greater than the previous week. I feel this might be another indication that the strength in the market values might be slowing somewhat,” said Beggs.
The number of daily adjustments for “Clean Condition” vehicles was just under 500 vehicles. Fifty-seven percent of the changes for the week were increases averaging +$184. While including the vehicles that depreciated this past week from the previous week, the overall market adjustments were still positive coming in at an increase of just under $50.
“Looking at 30 and 90 day trend reports, both time periods showed positive value adjustments for domestic car, import car, domestic truck, and import truck segments. These ranged from a 0.83-percent increase in the last 30 days for import cars to a 1.6-percent increase for the domestic truck segment,” said Beggs. For the previous quarter the increases were even stronger overall, with the smallest increase domestic cars at 0.18 percent to a 4.13-percent increase on domestic trucks.
“Confirming our love affair with trucks and SUVs, the annual market changes from August 2008 to present showed the import truck segment depreciating only -5.9 percent while the Domestic Truck segment increased 2.2 percent over the past year,” noted Beggs.