GAINESVILLE, Ga. -

Black Book found that the last week’s average wholesale price declines for both cars and trucks established new highs for the calendar year.

Managing editor Ricky Beggs revealed that car prices tumbled by $63 last week while truck prices sunk by $78.  Beggs said during his weekly online video analysis, “Beggs on the Used Car Market,” that it hasn’t been since Oct. 28 when cars dropped that much. He noted car prices declined during that autumn week by an average of $75.

A year ago, Beggs noted car prices softened by just $25 on average. He then tackled the question about whether last week’s movement was about to start an extended string of significant declines.

Beggs began with, “What could we expect going forward, and what do the historical trends tell us? The past seven weeks the average percentage of the adjustments that were increasing has been at 16 percent. One year ago, for the next seven-week period, the average percentage of increasing adjustments was 19 percent.

“During that time the average segment change was a $38 (decline) for the cars and a $43 (decline) for the trucks, significantly less than the changes this past week,” he continued. “From historical standards we should see softening values at possibly lower levels than the most recent couple of weeks.”

Looking deeper into last week’s car price changes, Black Book indicated premium sporty cars dropped the most, falling $125. Following that segment were luxury level cars (down $98), entry midsize cars (down $95) and compact cars (down $62). The car segment that dropped the least by Black Book’s count was entry level cars, which slid just $31.

Moving to a truck discussion, editors noticed all three crossover segment types along with luxury SUVs declined by more than $100. The truck segment that slipped the least were midsize pickups, which dipped by $21.

“Overall we have had a pretty consistent declining truck market,” Beggs pointed out. “Five of the past six weeks, the average segment change has been over $54 for a six-week average change just over $59.

“Last year at this point in the year the average change was $55,” he continued. “And of the four segments that were a $100-plus declining levels this past week, three of those were $100-plus declines a year ago, midsize crossovers, full-size crossovers and luxury SUVs.”

While the average decline registered a high so far for the year, editors adjusted 1,941 vehicles per day throughout last week; a figure Beggs said was the third-lowest amount over the past 11 weeks.

Beggs went on with his analysis by mentioning that if dealers aren’t talking about wholesale prices, they might be discussing how the weather is altering things in the lanes.

“The extremely hot weather across most of the country has been on almost everyone’s mind and has been mentioned in almost all of the survey personnel reports,” Beggs shared. “Even this past week as I attended an RV auction, the auction went above and beyond to help the dealers be as comfortable as possible with extra bottles of water, ice cold wet towels and spray on sunscreen.

“It must have worked as the sales percentage was solid and the selling values were very strong, especially for this time of the year,” he added.

Beyond the incident, Beggs offered another example of what the heat effected auction activity.

“According to several of the market summary reports from the Black Book survey personnel, the heat is being blamed, or credited, with the continuing softer market values for the auto sector of the market,” Beggs indicated.

“One of the pieces of information we capture from each market report is the weather conditions,” he continued. "Most of the time this is to know if it was raining or there was snow and ice. You might ask, ‘Why would rainy weather affect the market values?’ Have you ever tried to confirm the quality of the paint on a wet car? And if you are not positive about the inspection and quality level, you will definitely allow for that uncertainty in your bid level.

“This is only one of those items that are not available in the commercial electronic data feeds that we do capture with the Black Book physical presence and auction coverage,” Beggs went on to say.

“Rest assured we will be on the lanes reporting the market on a daily basis. We hope you won’t be overwhelmed by the extensive heat and will be back next week to join us for this market report. Have a great week,” he concluded.

Beggs’ video can be viewed below.