McLEAN, Va. -

If consumers take advantage of the latest used-vehicle pricing trend spotted by NADA Used Car Guide, dealers may soon see their trade-in supply increase sharply.

Prices on trade-ins are projected to crest in the next few weeks before used-vehicle prices move downward in June and July, according to NADA Used Car Guide, which projects the slide to continue in the second half of the year.

“While prices for all used-vehicle segments will remain stable over the next two months, compact and mid-size cars will appreciate in value and outpace other segments because of rising gasoline prices, shortage of inventory and strong consumer demand for fuel-efficient vehicles,” said Jonathan Banks, executive automotive analyst with NADA Used Car Guide.

Specifically, used compact and midsize car values were 2.6 percent stronger, on average, in April than they were in March, analysts noted. Since the beginning of 2012, there has been a 4.3-percent hike for these segments.

"The most advantageous time this year to trade in a used car will be April through May because values will be higher," Banks added.

Sharing some examples of compacts and midsize cars price growth, NADA Used Car Guide’s data indicates the trade-in value of a 2011 Kia Rio jumped 15 percent from January to April, while the 2009 Toyota Prius climbed 12 percent. Several models increased by 10 or 11 percent.

The firm went on to emphasize the used-vehicle pricing impact from the shortage of some popular models in recent years, as off-lease and trade-in supply diminished.

“The ongoing decline in the used-vehicle supply that began in 2009 has made it challenging for new-car dealers to consistently stock reliable, well-maintained used vehicles,” Banks explained.

“This means that dealers will be aggressive with trade-in offers for used vehicles that are in high consumer demand,” he continued.

In fact, vehicles that are aged less than five years have shown a 14-percent decrease in supply in the last three years, according to NADA estimates.

"Clean, late-model used vehicles under six years old with reasonable mileage will command top dollar," Banks added.

Looking forward, overall used-vehicle prices will likely drop 0.5 percent from April to June and then the drop-off will accelerate the rest of the year, analysts project. The April-to-July decline is expected to be 1.5 percent.

"Over the past few years, the auto industry has gone through automaker bankruptcies and restructurings, a challenging economic environment and natural disasters which have resulted in significant seasonal volatility," Banks said.

“Last year, used- vehicle prices remained high through July because of a new-vehicle shortage stemming from the natural disasters in Japan, which led to a spike in demand for used vehicles,” he continued. “This year, used-vehicle prices will return to a more normal seasonal pattern.”

NADA, J.D. Power Strike Deal

In other news coming out of the National Automobile Dealers Association, a strategic alliance between NADA and J.D. Power and Associates was announced Monday. Thanks to this deal, dealers will receive guidance on how to take their own business data and generate enhanced market intelligence via the Power Information Network of J.D. Power.

NADA explained that is part of the association’s efforts to assist dealers in using data to “improve operations while satisfying their regulatory obligations.”

Association president Phil Brady said: "NADA wants access to dealer data to be done the right way, and J.D. Power expressly acknowledges that the dealers own that data.

“J.D. Power is a well-established leader in vehicle marketplace information," Brady added. "And we welcome the opportunity to work with them to ensure data collection protects and promotes dealer interests.”

As most likely know, PIN offers participating dealers point-of-sale used- and new-vehicle transactional data. Dealers can use PIN to manage risk and make better-informed inventory decisions, and of course, boost their sales, officials explained.

The solutions provided via PIN help dealers tackle areas like vehicle and F&I pricing; vehicle appraisals; local market and competitive benchmarking; marketing strategies; and inventory optimization, just to name a few.

"PIN helps dealers understand key consumer and vehicle sales trends in their market," said Finbarr O’Neill, president of J.D. Power and Associates. "This, in turn, helps ensure that the right product mix gets to the marketplace to meet consumer demands."

Officials also stressed that one of the many benefits of a new dealer agreement is the enhanced indemnity to protect dealers. They also emphasised that J.D. Power said it will "ensure that their data is properly used and maintained."

O’Neill added: "J.D. Power is very pleased to be working with NADA to address these important issues. We share NADA’s desire to act in the best interest of the dealer."