CARMEL, Ind. -

When looking at February’s wholesale price movements, ADESA’s Tom Kontos urges a bit of caution.

While on the surface it’s clear that there was both a sequential and a year-over-year decrease in prices, these modest declines are a bit deceiving, he argued.

Kontos explained that the dealer consignment climbed absolutely and proportionately, and this trend caused wholesale values to be “biased downward.”

“Because dealers tend to wholesale lower-priced vehicles than institutional consignors, this caused weighted average prices to fall even though dealer consignment prices themselves were higher — as were prices for the fewer institutional units sold,” he shared.

“In other words, wholesale used vehicle prices continue to be near historical highs, reflecting tight supply and strong demand, which should continue as the spring market/tax season progresses,” Kontos continued.

Specifically, average wholesale prices came in at $10,026 during the month, marking a 1.2-percent drop from February 2010 and a 0.5-percent sequential dip.

Breaking it down by segment, truck prices softened 1.4 percent on a month-over-month basis and fell 2.2 percent from February 2010.

Cars, meanwhile, were up 0.4 percent from January, but their prices softened 0.1 percent from a year ago.

“Higher gas prices during the month may have caused prices to soften for larger car, pickup truck, SUV and van segments, while prices for their smaller counterparts rose,” Kontos shared.

He gave the example of full-size pickup trucks, which saw a 1.2-percent sequential decline compared to the 2.9- percent hike for compact pickup trucks.

Likewise, full-size cars were off 3.4 percent month-over-month, while there was a 2.2-percent hike for compact cars. Values for full-size vans dropped 3 percent from January, compared to the 2.2-percent minivan price growth.

Moreover, full-size SUV prices softened 3.8 percent month-over-month, while mini SUVs were ahead 1.7 percent.

“This may reflect changing consumer tastes favoring smaller versions of the same vehicle type — a development we will continue to monitor,” Kontos noted.

He also pointed to a 4.3-percent sequential price drop for luxury cars and a 2.1-percent luxury SUV price decline.

Looking at price changes for consignor types, prices for OEM units were up 3.9 percent month-over-month and 9.5 percent year-over-year. There was a 3.4-percent month-over-month dip in fleet prices, which moved ahead 2.3 percent year-over-year.

Values for dealer consignment increased 0.9 percent on a sequential basis and jumped 8.2 percent year-over-year.

According to estimates from ADESA Analytical Services, there was 27 days’ supply of auction inventory at the end of February. A year ago, that figure was 33 days. This marks “an indication of continued tight supply,” Kontos shared.