GAINESVILLE, GA - The end of the year should be a little slower than normal in the wholesale market arena, according to Ricky Beggs, VP and managing editor for Black Book.
"That's nothing to be alarmed about. There was just more interest in last minute shopping for smaller gifts than cars and possibly even more excitement building about the remaining college bowl games around the country," Beggs said.
As expected at many auctions this past week, the crowds were good, but the aggressive bidding has declined quite a bit. This is typical, as many dealers are lying low during this end of the year stretch, while describing the auction as "a good day for December." A couple of dealers even commented that we should be prepared for higher prices by the first of February 2012, according to Black Book.
"The limited activity was confirmed by the number of adjustments required," Beggs said. The average of 1,425 models adjusted each day was the smallest average daily adjustment for a full week since the week ending September 1, 2011.
The number of adjustments relating to Clean and Average was more normal as this was the first time in the past 4 weeks where the number adjusted by condition was very similar.
With a solid 31 percent of the adjustments being increases, the overall average change amount was just over a $47 decline. This is the smallest decline since the week ending June 24, when the overall change was right at -$35.
Trucks continue to be slightly better retention than the cars this week at -$35 for the trucks and -$52 for the cars. This is the first time over the past 3 weeks where no truck segment increased. We did have 3 truck segments where the decline was only by single digits. The Cargo and Passenger Minivans (MVC, MVW) fell by $3 each with the Compact SUVs (CSU) declining by only $8.
On the other extreme there were some significant weekly changes of -$148 for the Full-size Crossovers (FXU) and the Luxury SUVs (LSU) down by $96.
Within the cars the average change of -$52 has been very close to this change amount for 3 of the past 4 weeks. As I mentioned earlier the cars are struggling slightly more than the trucks. The Upper Mid-size Cars (UMC) changed by -$12, the only sub -$25 change amount. For the past two weeks the segment with the largest decline was the Prestige Luxury Cars (PLC) at -$112 and the Premium Sporty Cars (PSC) at -$73.
"As you think about the numbers, the auction activity, just like the calendar is 'winding down' while preparing for a great 'market in Feb and March,' " Beggs commented. "Next week could bring a less active market, or a time to get a head start on the upcoming tax season."