CARMEL, Ind. -
Wholesale values declined on a sequential basis in October and the year-over-year gains the market showed were somewhat deceptive, according to ADESA’s Tom Kontos.
Specifically, the average wholesale price for the month was $9,768, which is 0.7 percent softer than September and a 3.2-percent year-over-year hike, he noted.
The year-over-year increase, though, is from rather soft comparables, Kontos pointed out.
He noted that “used-vehicle values in October 2009 were relatively weak, as retail used-vehicle sales were still reeling from a Cash for Clunkers retail hangover, and as many dealers abstained from purchasing used-vehicle inventory at wholesale while they awaited repayment from Uncle Sam for the vouchers they had fronted as part of that program. 
“Absent the weak year-ago comps, wholesale prices this October exhibited no exceptional strength; rather, they essentially followed their typical seasonal softening pattern,” he continued.
That said, Kontos indicated that used-vehicle supply tightness brought “underlying support” in the wholesale market. This is likely to stick around for the remainder of the year and spill over to the next.
Breaking down October’s wholesale activity by segment, all classes showed month-over-month softening, except for midsize SUVs (up 0.4 percent) and compact pickups (which were static).
On a year-over-year basis, all truck segments were up, with full-size vans (increasing 13.9 percent) leading the way. Meanwhile on the car side of the market, two segments — midsize cars (up 7.4 percent) and sporty cars (up 2.2 percent) — showed increases, while three segments were down, those being compact cars (down 1.5 percent), full-size cars (26.4 percent) and luxury cars (down 1 percent).
Overall, cars were up 1.9 percent from October 2009 and down 0.4 percent from September. Trucks moved ahead 5 percent from a year ago and decreased 1.3 percent from the prior month.
“Other than small-volume segments with few (and sometimes discontinued) model entries like full-size cars (e.g., Mercury Grand Marquis) and full-size vans that often fluctuate wildly, most model classes are tracking fairly closely with the market,” Kontos pointed out.
Next up, Kontos looked at consignor segments. Prices for manufacturer sales jumped 4.8 percent from September, but were even from October 2009.
In fleet/lease sales, prices dipped 3.3 percent month-over-month, but climbed 4.7 percent ahead of year-ago figures.
Meanwhile, prices in dealer sales climbed 1.2 percent from September and 9 percent from the year-ago period.
Moving on to auction industry inventory, the October end-of-month amount was 31 days, Kontos said, citing ADESA Analytical Services.
A year ago, the inventory level was 35 days.
Explaining this trend, Kontos said that “dealers appear to be snatching up any additions to supply that may be arising from the fall de-fleeting season.”
Retail Trends
Moving over to the retail side of market, there was a 40.1-percent lift in used sales compared to October 2009, Kontos indicated, citing CNW Research.
Franchise dealers enjoyed a 50.9-percent upswing in used sales, while independents improved 30.6 percent, he added.
However, these reflect rather soft year-ago figures that were impacted by CARS, Kontos stressed.
“Again, weak comps for retail sales in October 2009 from the Cash for Clunkers hangover biased upward this October’s year-over-year comparisons,” he noted.
Compared to September, there was a 19.1-percent dip in used sales. Kontos said independent and franchised stores were “sharing in the decline.”
Citing Autodata, Kontos said there was a 23-percent year-over-year gain in October’s certified pre-owned sales and a 4.6-percent sequential hike.
According to Bureau of Labor Statistics data, there was an 8.6-percent gain in the consumer price index for used models compared to October 2009.