NADA UCG: Auction Volume Way Up, Black Book: Full-Size Pickup and Sub-Compact Car Had Highest Depreciation March 17, 2016

Late-Model Vehicle Oversupply Behind First February Price Drop in 20 Years

Jonathan Banks
Executive Automotive Analyst
NADA Used Car Guide

While NADA Used Car Guide’s latest price index was up more than 4% over February 2015, prices were at a historically weak level. Wholesale prices were down 1% from January, and it was the first time in 20 years that prices didn’t increase. Late-model vehicles had much to do with the oversupply and soft prices. Auction volume of 2014 and 2015 model year vehicles increased by about 20% from January to February – four times greater than in past two years.

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Luxury Segments Were Hit Hardest in Downward Prices in February:
Luxury compact car, large utility, and mid-size utility prices fell by an average of 2%.

Large Pickup and Utility Losses Outpaced Other Segments by Average of 1%:
Reversed long-held strong position, while compact cars continued weak performance.

Prices for Vehicles Up to 8 Years Old Rising 2% to 2.5% in March over February:
Wholesale price growth is expected to be more pronounced for cars than trucks.
Anil Goyal

Cars and Trucks Saw High and Low Price Fluctuations by Segments

Anil Goyal
Senior VP of Automotive Valuation and Analytics
Black Book

Used vehicle data from the month of February showed that most car segment's retention has generally continued to perform weaker than that of trucks. The month did see variations by segment, with a few truck segments showing much weakness while some car segments showed strength – and vice versa. Full-Size Pickup and Sub-Compact Car both experienced the highest depreciation in the month of February. Mid-Size Car and Compact Crossover/SUV performed the best in retaining value in February.

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High Supply and Low Demand for Small Cars threw Off Spring Market:
Crossover/SUV segments continue to get more interest from buyers.

Full-Size Car, Mid-Size Car and Near Luxury Car Best Performing Car Segments:
Segments changed in value by 0%, -0.2% and -0.2%, respectively.

Overall Truck Values Decreased by 0.26% Last Week:
Better than the average depreciation rate of 0.36% seen in the previous eight weeks.
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Banks_Jonathan_NADA_ March 2016
March 2016 Used Vehicle Industry Update

With executive-level analysis, Jonathan Banks explains how the used vehicle market performed during February 2016.

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