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Hello and welcome to this week’s Used Car Market Report, with insights from Black Book. It’s great to be back with you, and from home base and the Black Book offices. The show in San Francisco was tremendous for our team and with the enthusiasm of the franchised dealers, we are sure to have even higher new car sales in 2015, which means even more used inventory in both the wholesale and retail channels. Unless we have another period of year over year significant new car transaction price increases, we will have a larger annual level of depreciation than the -12.1% of 2014 for the group of two to six year old vehicles in our benchmarking trend report.
But more important is what happened within the most recent week of market activity and used price movement. We might as well start with the expected gas price report. The price at the pump for gas fell only $.02 week over week to a national average of $2.04 per gallon, while diesel fell almost $.07 to now stand at $2.87 per gallon.
If there was one thing that caught my attention from the weekly segment report, it was that the overall average segment change was the greatest declining amount for the cars and trucks over the past three months. And in the trucks, today’s market at -$47 was very similar to the one year ago change of -$45. The cars at -$74 this past week is just under the -$86 change level of one year ago.
Looking at individual car segments, eight of the ten segments we track had larger declining levels this past week compared to the prior week. Only the Entry Level Cars and the Upper Mid-size Cars had smaller average changes, and those were only better by $1 each. I have to ask the question, is this level of change reflective of gas prices or being driven by the sometimes present “end of the month” market action?
Following the “end of the month” market thought, the trucks had thirteen of the fourteen reporting segments with the same or greater declining levels as compared to two weeks ago. The remaining segment, the Full-size Pickups, at only -$5, are the second best level of retention over the past few weeks, only behind the amazingly strong Compact SUVs, which have had positive changes week over week for the past five weeks.
We hope you will tune back in next week to see if the first week of February brings us a slightly better reaction within the market. The online and on the lane activity is focused on getting cars sold. We hope you have a great day!