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Comments made such as ”dealers starting an adjustment” and “dealers being selective” along with “buyers being cautious” coming in with the Black Book survey personnel reports caught our attention and led to anticipation as to what the actual adjustments would be after a week of market analysis.
Hello and welcome to this week’s edition of Beggs on the Used Car Market, with data and analysis from Ricky Beggs and the editors at Black Book. Thanks for taking the time to take a look at the actual market results for the past week with us. Along with the earlier mentioned comments there was another that caught my eye from one of the Pennsylvania based auctions that said the “auction needs buyers”. I think a better way to describe it is that the actual sellers on the block need them even more to make the transaction take place.
Even with the average number of adjustments made each day throughout the week at 1910, which was an increase over the 1819 the previous week, and even more than the 1390 three weeks ago, the percentage of those adjustments that were increases in values has been very consistent over the past three weeks ranging from 33% to almost 38%. In our analysis the truck segments continue to show a stronger or more stable market with the overall average segment change of -$17 this past week and a six week average change of only -$8. The same period within the car segments has brought us a -$53 average change or a -.31% weekly percentage change compared to -.06% for the trucks.
Let’s go back and take a closer look at the adjustments that were increases. Remember the overall level of increases for the past three weeks was 35%. Breaking out the cars and the trucks, points out differences in the number of increases, ultimately supporting the overall change differences of the two groups. During the past three weeks, increases within the cars ranged from only 12% to 17% and then to 20% while the trucks continue to hold steady at 47% to 50% and 51% of the adjustments being increases.
After three weeks of increasing gas prices, a little relief showed this past week as the price at the pump fell almost $.02. We are still $.02 above year go prices. One year ago the trend in prices were in a downward price level for the next five weeks before a slight bump around the July 4th holiday, before then gradually declining the rest of the year until December. Let’s hope the gas price pattern of 2014 mirrors that of 2013.
With the car average segment change this past week of -$53, except for the Entry Level Cars at a $1 increase for the week and the Prestige Luxury Cars at -$118, the remainder of the car segments change amount almost mirrored the average segment amount for the week.
As we mentioned the more stable truck market earlier, there are three segments that have now increased week over week for multiple weeks. The Full-sized and Mid-sized Pickups along with the Full-size SUVs at +$23, +$21 and +$10. The fourth increasing segment for the week is the Cargo Minivans at +$16. The truck segment with the largest drop in value this past week is the Full-size Crossovers at -$76. A segment that for most of the first half of 2014 that has been relatively strong, has softened enough over the past two weeks to have the highest average 2 week decline, -$39 and -$48 respectively within the Compact Crossovers.
As we are almost halfway through calendar year 2014, and not far from many of the 2015 models coming into the market, some of the not as high volume 2014s, or those that were not put into daily rental at significant levels, are finally showing up in the used wholesale market, and thus giving the Black Book editors enough market data insight to publish market driven values. Make sure you keep your eyes open to this additional data.