Wholesale Vehicle Prices Decline in First Half of February – Remarketing

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Pickups had the smallest year-over-year gains, vans had the largest at 51.1%, and both non-luxury car segments outpaced the overall industry in seasonally adjusted price growth. - Source: Manheim

Pickups had the smallest year-over-year positive factors, vans had the biggest at 51.1%, and each non-luxury automobile segments outpaced the general trade in seasonally adjusted worth development.

Supply: Manheim

Wholesale used-vehicle costs (on a mix-, mileage-, and seasonally adjusted foundation) declined 1.5% within the first 15 days of February in comparison with the total month of January, Manheim reported Feb. 17.

This introduced the Manheim Used Automobile Worth Index to 232.8, which was up 38% from February 2021. The non-adjusted worth change within the first half of February was a decline of 1.4% in comparison with January, leaving the unadjusted common worth up 33.5% yr over yr.

Manheim Market Report (MMR) costs noticed accelerating declines by the primary two weeks of February. The Three-Yr-Previous MMR Index, which represents the biggest mannequin yr cohort at public sale, skilled a 1.7% cumulative decline over the past two weeks. Over the primary 15 days of February, MMR Retention, which is the common distinction in worth relative to present MMR, averaged 98%, which signifies that market costs are trending down sooner than valuation fashions.

The common every day gross sales conversion fee of 47.5% within the first half of February declined relative to January’s every day common of 49% and is decrease than common for this time of yr. The newest traits in the important thing indicators counsel wholesale used-vehicle values will probably see additional declines within the second half of the month.

On a year-over-year foundation, all main market segments noticed seasonally adjusted worth positive factors by the primary 15 days of February. Pickups had the smallest year-over-year positive factors, vans had the biggest at 51.1%, and each non-luxury automobile segments outpaced the general trade in seasonally adjusted worth development. In comparison with January, all main segments besides vans noticed worth declines, with mid-size vehicles declining essentially the most.

Used provide trended larger in January: Utilizing estimates of used retail days’ provide based mostly on vAuto knowledge, January ended at 56 days, up six days from December and up 12 days yr over yr. Leveraging Manheim gross sales and stock knowledge, Manheim estimates that wholesale provide ended January at 31 days, up 5 days from December and up three days yr over yr. As of Feb. 15, wholesale provide was at 29 days, down two days from the top of January.

Rental danger pricing additionally declines: The common worth for rental danger items offered at public sale within the first 15 days of February was up 33% yr over yr. Rental danger costs have been down 2.4% in comparison with the total month of January. Common mileage for rental danger items within the first half of February (at 59,353 miles) was up 13% in comparison with a yr in the past and up 0.1% month over month.

Auto mortgage delinquencies again to regular, however defaults stay low: Auto mortgage efficiency deteriorated once more in January because the abnormally robust credit score efficiency for a lot of the pandemic has returned to extra regular patterns of delinquencies. The over 60-day delinquencies elevated in January for the eighth month in a row and have been up 3% yr over yr. In January, 1.51% of auto loans have been severely delinquent, which was a rise from 1.45% in December and the best extreme delinquency fee since February 2020.

In comparison with a yr in the past, the extreme delinquency fee was 7 foundation factors larger. In January, 5.74% of subprime loans have been severely delinquent, which was a rise from 5.48% in December and the best extreme delinquency fee since January 2020. The subprime extreme delinquency fee was 53 foundation factors larger yr over yr. Greater delinquencies will not be resulting in pre-pandemic ranges of defaults but. Mortgage defaults declined 7% in January from December and have been down 5.7% yr over yr. Auto credit score entry expanded in January. The Dealertrack Credit score Availability Index measured auto credit score as looser in January in comparison with any month since November 2018.

Initially posted on Vehicle Remarketing



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