GAINESVILLE, GA - The second week of June showed signs in some auctions that we were definitely in that "fourth of July" holiday mode, while other auctions were trucking right along. As one of the Black Book survey personnel reported, it was a “tough holiday sale with lower consignment”. Along with this activity one dealer commented to us at an auction that the market ”appears to be adjusting.” This adjustment that we saw this past week is a continuation of the last several weeks.
There are a few units that are moving up in value week over week. This past week with almost 1,950 vehicles adjusted each day, at 20 percent of adjustments being increases to the value, this was the smallest number of positive adjustments since the week ending November 19, 2010.
"The $78 decrease in all the adjusted vehicles this past week was the largest amount dating back for 22 weeks, which takes us back to the week ending February 18," said Ricky Beggs, VP and managing editor for Black Book. "This is the second consecutive week where all 10 car segment types have declined and the fourth straight week of overall car decline."
With segments changing from a low of -$5 for both the Entry Sporty Cars (ESC) and the Full-size Cars (FSC) to the largest declining segments of the Upper Mid-size Cars (UMC) at -$31, the Luxury Level Cars (LLC) at -$28 and the Prestige Luxury Cars (PLC) at -$27, the overall change to the cars for the week was a meager -$18. The overall truck segments average change has declined for the previous 10 weeks.
This week’s -$51 was the largest decline during the 10 week run. The 3 segment types with the most significant adjustments consisted of the Luxury SUVs (LSU) at -$152, the Full-size SUVs (FSU) at -$125 and the Full-size Pickups (FPT) at -$75. Only the Mid-size Pickup Trucks (MPT) up by $8 and the Cargo versions of the Minivans (MVC) which increased by $1 were increasing segments for the week.
"During the past few weeks each of the Editors has been doing some analysis that is necessary in projecting residual values for the 2012 models that are now appearing in the market. This will continue for the next four to five months," said Beggs. "We see the used market making a slight adjustment in order to create room for a new model year that is and will be entering the market. Several dealers have told me recently that they feel the market adjustment will not be as much as we would normally see due to the current limited supply of used cars."
If you want to see a bright spot in the market, look at most any solid average or clean vehicle that is 5 to 6 years old. We are seeing fewer no sales on the auction lanes of the models from that older vintage, according to Beggs.