According to a Thursday (April 7) Cox Automotive press release, Manheim’s recent analysis of used vehicle prices found that prices were down 3.3% in March from February, though this took in adjustments based on miles and seasonal adjustments.
The index is “increasingly recognized” by financial and economic analysts as an indicator of the pricing trends, though it shouldn’t be used as a way to show any individual remarketer’s results.
According to the report, the Manheim Used Vehicle Value Index declined to 233.5, which was up 24.8% from a year prior. Manheim also said there were actually weekly price increases in March, after the first week saw the smallest decline of the year.
Over that month, the daily Manheim Market Report (MMR) retention, or the average difference in price compared to the current MMR, was at an average of 99.6%. That means the prices had been slightly behind MMR values.
There was a lower conversion rate, though, meaning that the month was seeing buyers with more bargaining power for this time of year. All of the major market segments saw seasonally adjusted prices, higher year over year in March, with vans having the largest in that regard.
However, on a month-over-month basis, all the major segments saw seasonally adjusted price declines. Pickup trucks saw the biggest decline, with seasonal adjustment answering for most of that.
In addition, the report said combined sales into large retail, commercial and government buyers were down almost 4% year over year in March. Sales into rental were down 19% year over year, while sales into commercial fleets were up 19%.
PYMNTS wrote that there’s data showing there had been double-digit declines in new vehicle sales, with General Motors down 20% and Honda down 23%, among others.
This shows that chip shortages and supply chain disruptions have been agitating things, and in general, automakers think demand could be stronger going forward because of the labor market.
However, the report said there are signs that there might be turbulence — the lack of available inventory means unit sales would fall, so being able to build less means a loss is somewhat inevitable.