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Here is the latest used-car market report from Ricky Beggs, Managing Editor of Black Book.
This time of the year seems to get people in a very festive mood for both holiday parties with co-workers, friends and families as well as the end of the year retail sales push within the auto industry. We always hear about the large percentage of sales in general department stores and specialty shops that occur within the last two months of the year. This often rolls over to the auto side and this is very prevalent this year. The new car SAAR peak for 2012 was in November and all indications are that December will not be too far behind the record numbers of November. My numerous calls with dealers across the country this past week definitely supports the anticipation of another great sales month.
New cars sales strength can have a myriad of effects on the used wholesale market. Great retail for new vehicles will undoubtedly bring in more trades, which could ultimately be the next retail piece that doesn’t have to be purchased at an auction. At the same time it might be just the right wholesale piece to take to an auction for some lively competitive bidding.
As we looked at the comments from the Black Book survey personnel from this past week’s auction reports, there was less of a consistent pattern in what was taking place in the lanes than we have seen and heard in several months. During the first half of the week the primary comments were touting the upbeat attitudes of both buyers and sellers. As there were multiple reports of “more buyers than sellers”, this supported the fact that prices were at least holding and that demand was up as described by “money was looser”.
As the week progressed the comment of choice related to a shortage of cars available as “there were less cars being offered”. In turn that has held prices fairly strong, or at least stable. With a shortage of cars, many sellers were trying to hold tight to the listed floors, thus a few more no sales.
One slight change from the previous several weeks of auction activity was the interest being exhibited toward some of the 2012 models. I was less surprised at the strong interest in clean, lower mileage cars and trucks and also the increased interest in this type unit from the internet buyers. We generally expect this really nice unit to bring out the internet buyer but this probably was driven even more so from the northeast market buyers reaching further out to find the right desperately needed inventory.
I have intentionally left out the random numbers of adjustments, segment changes and various trends that picture the market activity. Sometimes just hearing the actual comments and seeing the reaction of the buyers in the lanes and the sellers on the block truly tells the story of the current market conditions. If you just have to see some of the numbers from this past week’s editor changes, just click on the “see the graphs” in the video for the supporting data to this past week’s market. If you want to hear the various numbers check back with us next week and I will make sure to explain some of the resulting changes.