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With reports of the “sellers are happy” and “it’s a sellers’ market”, the results of the weekly market changes were bound to show continued strength. The only question remaining was just how strong it would actually be after a full week of auction activity. Welcome back to this week’s Used Car Market Report with insights from Ricky Beggs from Black Book.
As I reviewed the various comments from the Black Book survey personnel who attend over 63 auctions across the country every week, the closest thing to a negative comment about the market was from a mid-west auction location that described the market as “not as aggressive”. The need for good used inventory seems to be the case across the entire country, which is bringing out better attendance both in the lanes and with multiple bidders online for almost every offering. Something else that we noticed this past week in this “sellers’ market” was that the overall better condition units, even when they had some slightly edgy miles on the odometer, were getting all of the attention.
Last week we highlighted the level of increasing adjustments at a yearly high 68%. Well, the bar has been raised again this past week with over 71% of all adjustments, at a strong over 2000 units adjusted each day throughout the week. And speaking of first for the past year, this most recent week the overall average segment change for both the cars and the trucks finished at positive levels with the trucks at +$51 and the cars slipping in at +$1.
With six of the ten car segments being positive change levels, every segment that was positive this past week is now on multiple consecutive weeks of positive change with three of them running positive for five consecutive weeks, the Entry Level Cars, the Entry Mid-size Cars and the Upper Mid-size Cars.
If you think there is demand for the car market, then the positive change level week over week for thirteen of the fourteen truck segments is an even more impressive market movement. This market strength is being led by the very versatile Compact Crossover Utilities at +$39 this past week with this segment now positive week over week for four consecutive weeks. For the first time in at least the past three weeks, increases are present for both Full-size Van segments and also the Full-size SUVs. This leaves the lone declining segment being the Luxury SUVs at -$33.
If you are looking for stability, then don’t look at most of the vehicle values, but at the price of gas and diesel fuel. We are still below year ago levels for both fuel types with no change on gas this past week and a $.015 decline for #2 diesel.
With the low level of no sales resulting from aggressive bidding, “retail on the lanes” was mentioned multiple times in the survey reports. Another great description of the market was “there was a buyer for whatever crossed the block”. I even talked with one dealer who mentioned offering some over aged units just hoping the market was solid enough to soften the losses. He was ecstatic that he actually broke even on a couple and made some good money on the remaining units.