GAINESVILLE, FL – It’s the time of the year when industry personnel are looking for educational opportunities with various conferences and seminars. Black Book will be at several of these in the next couple of months, including the IARA in Chicago next week, the AFLA annual convention in Phoenix, the Auto Finance Summit and National Remarketing Conference both in Las Vegas as well as the NAAA annual convention in San Francisco.
“It’s also the time of the year, where in most past years, a general softening has occurred in the used car market with regard to values and activity,” notes Ricky Beggs, VP & managing editor at Black Book. “It is also the time of the year where many of the daily rental companies and commercial fleets would be changing their inventories with newer models while remarketing the 1-3 year old models. However, their inventory realigning is not in full force right now.”
Currently, the market is more stable than strong right now, comments Beggs. The supply of new models is tighter right now than in a long time due to the rush on new vehicles because of the cash for clunkers activity and the recent temporary closing of many plants designed to get inventories under control.
“These plants are just now getting some inventory flowing back to the dealerships. This will continue for a while as Congress just passed and extended the program with an additional $2 Billion in funding. We have been asked several times if the Cash for Clunkers program has caused a change in used vehicle values. We have not seen a direct correlation in the market adjustments on the used values as this program is all about new car sales and destroying the traded clunkers. It’s the easiest appraisal the Used Car Manager has ever had to make,” said Beggs.
In his recent market report, Beggs commented on the number of 2009 used models increasing in value. These will fill the need for the retail consumer who doesn’t qualify for the clunker cash, but still has the desire and need for a new or almost new used car or truck, he said.
“With a stable market, we averaged 1,499 vehicle adjustments each day during the past week. The average change amounts this past week for Clean Condition vehicle values showed 71 percent of the changes were positive with an average change of +$100. Those decreasing in value for Clean Condition were -$144. Overall the movement of the Clean Condition values was an increase of +$51,” said Beggs.
Being more detailed, the 10 Car segments Black Book tracked ended with an average decrease of -$22. Only two segments showed positive adjustments this past week — entry mid-size cars and the entry sporty cars. The 14 Truck segments were all up or even this past week with an average adjustment for the 14 segments being +$33.