AutoTrader: CPO Average Asking Prices Reverse in October

Supporting the strong October sales performance previously revealed by Autodata, analysts from AutoTrader.com indicated Wednesday that the average asking prices for certified pre-owned vehicles showed significant improvement.

As opposed to September, when prices dipped for 15 out of 20 most-searched CPO vehicles on a year-over-year comparison, the site determined prices increased for 14 of the top 20 most-viewed units in October. AutoTrader.com discovered a certified Toyota Highlander posted the biggest increase at 6.83 percent, moving from $23,941 in October 2009 to $25,577 last month.

Besides the certified Ford Mustang, AutoTrader.com also indicated all year-over-year average asking price increases above 4 percent were for either trucks or SUVs.

A certified Chevrolet Tahoe climbed 6.48 percent from $31,525 to $33,569. Other notable CPO units with strong year-over-year gains were:

—GMC Sierra 1500: up 5.62 percent from $24,291 to $25,657.

—Ford F-150: up 5.50 percent from $23,664 to $24,965.

—Chevrolet Silverado 1500: up 4.86 percent from $23,389 to $24,525

—Honda Pilot: up 4.29 percent from $24,301 to $25,344.

—Acura MDX: up 4.12 percent from $31,294 to $32,582.

Analysts reiterated CPO asking prices on AutoTrader.com reflects the strength in CPO sales that many brands experienced in October and indicates that this segment should remain strong as asking prices can be a leading indicator of expected demand for CPO vehicles.

The consumer popularity for trucks and SUVs permeated beyond AutoTrader.com’s examination of just CPO units.

Turns out, the site’s analysis of both the top 20 most-searched used and CPO vehicles did not show significant changes in the models searched month-over-month. Trucks and SUVs continue to hold the majority of places on these lists with more than half of each list being composed of these units

AutoTrader.com chief executive officer Chip Perry stressed that the continued dominance of trucks and SUVs is typically welcomed news for the auto industry and economy as a whole.

“Trucks and SUVs are a good indicator of the state of the economy because they are particularly sensitive to economic changes,” Perry explained.

“These vehicles are used by workers in numerous industries, so interest in trucks and SUVs points to the continued recovery in the health of the economy,” he continued.

“Gas prices are another factor that affects interest in and sales of these vehicles,” Perry went on to say. “Although gas prices aren’t the lowest they’ve ever been, the prices are still in a range that doesn’t dampen shoppers’ interest. Those are two good signs all around.”

Reinforcing Perry’s points were the positive asking price movements made by several used vehicles, especially trucks and SUVs.

Among used units, AutoTrader.com found the Dodge Ram 2500 posted the largest gain in average asking price, going from $23,828 to $25,097 in October for an increase of 5.33 percent.

Four other used trucks enjoyed price gains of at least 4 percent. The site indicated they were:

—Chevrolet Silverado 1500: up 4.80 percent from $19,024 to $19,938.

—Ford F-250 up 4.64 percent from $23,509 to $24,600.

—Chevrolet Silverado 2500 up 4.58 percent from $22,556 to $23,588

—Dodge Ram 1500 up 4.37 percent from $17,687 to $18,460.

Only two trucks among AutoTrader.com’s top 20 most-searched used vehicles slid down in price during October. But used versions of the Toyota Tundra and Tacoma dipped marginally, 0.39 percent and 0.5 percent, respectively

A handful of used SUVs posted price gains of more than 3 percent last month on a year-over-year comparison. AutoTrader.com noticed three units on its top 20 used unit list:

— Jeep Wrangler up 4.7 percent from $19,578 to $20,499.

—Chevrolet Tahoe: up 4.51 percent from $24,459 to $25,561.

—Jeep Grand Cherokee: up 3.38 percent from $16,030 to $16,572.

Perry said that all of the used and CPO average asking price increases were relatively modest compared to the numerous double-digit price increases seen earlier this year.

“With the economic downturn, three major trends emerged for pre-owned vehicles that greatly affected prices,” Perry surmised.

“People were holding on to their cars and not trading them in, the majority of people in the market purchased pre-owned instead of new and leasing practically dried up. All of these factors contributed to reduced inventory for used and CPO cars, which drove prices up significantly during the first three quarters of this year,” he explained.

“The trend that we’re seeing now with prices appears to point to more stable inventory levels for these vehicles,” Perry stressed.

The site made one other point about used and CPO activity at AutoTrader.com.

On the list of the most-searched used brands, AutoTrader.com pointed out Ford remained at No. 1 in October, a position the nameplate held at the same time last year, too. The site said Chevrolet came in as the No. 2 most-searched used brand and Toyota landed at No. 3, positions both brands also held in October 2009.

Notable Improvement for Many New Vehicles

Analysts determined the Toyota Camry was the most-searched new vehicle on AutoTrader.com in October, reclaiming the No. 1 spot after a summer hiatus from the list and steady climb in the preceding months. AutoTrader.com said the Camry was the second most-searched new vehicle in September and the seventh most-searched during October of last year.

However, what the site believes was the biggest story coming out of October’s top 20 most-searched new vehicle list appears to be the big movement for a number of small and midsize units.

AutoTrader.com mentioned five of these new vehicles made big jumps month-over-month on the most-searched list in October, with four of the five being small or midsize cars.

The site determined the Honda Civic moved up nine places from September, landing at No. 3 in October. Meanwhile the Volkswagen Jetta went from No. 25 in September to No. 11 in October, a leap of 14 places. The Ford Focus landed at No. 15 in October, up 12 spots from No. 27 in September. The Hyundai Sonata took the No. 17 place in October, up 15 from its No. 32 spot in September.

AutoTrader.com noticed the only SUV to make a notable jump was the Honda CR-V, which leapt 18 places from No. 26 in September to No. 8 in October.

“October is a great time to purchase a new car, as 2010 models are incentivized to make room for the new 2011 models,” Perry emphasized.

“As 2011 models begin dominating dealer lots, marketing and advertising for new cars ramps up — both in traditional media and online via social media and third-party sites like AutoTrader.com,” he added.

In October, the site pointed out that Honda launched a monthlong social media campaign. AutoTrader.com also mentioned Hyundai extended its “Uncensored” campaign to include the Sonata. Furthermore, the site said Volkswagen touted the affordability of the Jetta and Ford leveraged rebates and heavy promotion to support its ongoing success.

When looking at year-over-year comparisons, AutoTrader.com said its data showed that there were six vehicles in the top 20 most-searched new list that were not in the top 20 in October 2009.

Analysts found Ford made the biggest year-over-year top 20 improvement with three vehicles that broke into the top 20 in 2010. Those models included the Focus, the Fusion (No. 19) and Escape (No. 20). 

The other three vehicles to make year-over-year top 20 improvements are the GMC Sierra 1500, which the site said moved from No. 26 in 2009 to No. 14 in October of this year; the Honda CR-V, which was No. 23 a year ago and now sits at No. 8; and the Hyundai Sonata, which leapt 54 places year-over-year from No. 71 in October of last year to No. 17.

For new-vehicle average asking prices, AutoTrader.com determined 15 of the top 20 units posted increases with four units experiencing a price rise in excess of 4 percent. Those four vehicles were:

—Ford Mustang: up 4.37 percent from $32,794 to $34,227.

—Volkswagen Jetta: up 5.66 percent from $22,655 to $23,938.

—Hyundai Sonata: up 7.29 percent from $21,965 to $23,566.

—Chevrolet Corvette: up 7.85 percent from $64,796 to $69,880.

Site Traffic Breakdown

Site officials revealed a double-digit year-over-year unique visitors going to AutoTrader.com in October.

The figure climbed 13 percent lift from 13.6 million to nearly 15.5 million.

AutoTrader.com contends this lift was supported by numerous marketing initiatives, including great exposure in the Major League Baseball postseason and World Series, strong advertising on cable television and strategic partnership programs.

Furthermore, officials asserted October was also an excellent month for traffic to AutoTrader.com’s mobile site. They said the mobile version achieved the highest number of monthly visitors since its launch — again topping 1 million unique visitors.

“More people than ever are turning to third-party classified sites like AutoTrader.com to research and compare new and used cars,” Perry declared.

“By looking at the traffic on our site, we are able to see that shoppers looking for new vehicles are turning their attention to practical, but stylish cars, and low fuel prices continue to support interest in pre-owned trucks and SUVs,” he concluded.

AutoTrader.com also provided the following charts regarding trends spotted during October: