Wholesale used-vehicle prices in October continued to unseasonably rise, market analysis shows, as demand remains strong and automakers struggle to build new vehicles.
Cox Automotive’s Manheim Used Vehicle Value Index, which tracks vehicles sold at Manheim’s U.S. auctions, was up 38 percent in October compared with the same month in 2020. Manheim said some of that rise was due to seasonal adjustment, as there is typically above-average vehicle depreciation in October.
But on a nonadjusted basis, the year-over-year price increase for last month was 5.4 percent, and it marked the first time since Manheim began tracking the index in 1997 that there was a nonseasonally adjusted annual price increase for October.
The sales conversion rate was 67 percent, which was high for the month. That rate was at 49 percent in October 2019.
Meanwhile, Cox Automotive estimated that total used-vehicle sales were down 10 percent year over year in October. It estimated that used retail supply was at 39 days at the end of the month; normal supply is 44 days. Wholesale supply was at 18 days; normal supply is 23 days.
And market insights posted by Black Book on Tuesday show that through last week there have been 10 consecutive weeks of wholesale value increases — at a time when those values typically drop.
As the end of the year nears, large independent dealers and franchised auto retailers appear to have picked up their presence in the auction lanes, according to Black Book. But rental car companies, desperate for vehicles amid the new-vehicle shortage, still seem to dominate physical auction lanes, especially for newer, lower-mileage vehicles, Black Book said.