IRVINE, Calif. -

High levels of supply. That’s a term not heard in the used-car market in quite a while, but if Chrysler and Dodge minivans are hot items on your lot, you might want to take note. 

According to Kelley Blue Book, dealers have been enjoying “high supply” of Chrysler and Dodge minivans at auction.

As noted in the latest Blue Book Market Report from KBB,  this supply excess is due to year-end rental returns of both Chrysler Town & Country and Dodge Caravan minivans at auction during the past month.

And not only are there more of them, the influx of units has led to a significant decrease in auction values for both brands.

According to KBB, in October, the minivan segment saw a average price drop of 3.3 percent. And due to the spike in supply, the Chrysler Town & Country and Dodge Caravan saw the biggest declines of 4.3 percent and 3.8 percent, respectively, last month.

Other segments to keep an eye out for in the lanes are the SUVs and the crossover SUVs.

KBB reported a price trend switch that may interest dealers within these segments.

Specifically, the compact SUV/crossover segment experienced declined this past month — after holding “consistently higher than in 2012” earlier in the year, said KBB.

For this segment, October saw a drop of 3.6 percent in auction values month-over-month, which brought the average cost in the lanes from $15,688 down to $15,106 for 1- to 3-year-old vehicles.

This trend is directly tied to volume levels, as well.  

“The decline (in price) coincides with a significant increase in volume running through auction lanes,” said KBB senior analyst Alec Gutierrez. “In the third quarter of 2013, auction volume for the segment was up 22 percent from the third quarter of 2012 and is up by 10 percent year-to-date.”

Overall, on top of an increase in volume, overall seasonality is taking hold, as well.

KBB explained that after “outperforming” the market for much of 2013, auction values of 1- to 3-year old vehicles are seeing the effects of the season, falling 2.1 percent in October as an influx of off-lease vehicles hit the auctions.

The biggest prices drop seen in the lanes last month, according to KBB, was the luxury car segment, which saw several units fall by more than $1,000. The  Audi A7 topped the list for declines, seeing prices fall by $1,800, or 3.7 percent.

Gutierrez said, “Auction volume on used luxury vehicles also is finally seeing a turnaround after four straight years of being on the decline.

“Luxury volume was up 11 percent in the third quarter this year and is 3.1 percent higher year-to-date. However, with the increase in used supply comes an expectation for softening prices, especially since luxury values are seasonally weak in the later months of the year.”

 

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