The experts at Black Book and Cox Automotive are seeing wholesale prices and auction sales rates decline this month. The severity of those movements depends on which report you examined on Tuesday.

Beginning with Market Insights from Black Book, wholesale values softened another 0.82% last week, which was double the average drop analysts recorded during the same week from 2017 to 2019.

Black Book also mentioned that the estimated average weekly sales rate dropped to 54% during the stretch that closed Saturday.

Over at Cox Automotive, analysts there said wholesale used-vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) declined 2.0% from September during the first 15 days of October. That moved led to the Manheim Used Vehicle Value Index softening to 200.5, which was down 10.3% from October of last year.

Cox Automotive added the non-adjusted price change in the first half of October was a decline of 1.8% compared to September, pushing the unadjusted average price down 9.0% year-over-year. 

What does all this wholesale data mean? Here’s what Black Book had to say to open its latest installment of Market Insights.

“Remarketing strategies are varying from seller to seller and last week, we saw some sellers adjusting floors and off-loading inventory, while others held firm to floors,” Black Book analysts said.

“Repossessions are beginning to show up in the market and with fuel prices returning to a level last seen in February of this year, the car segment valuations are taking the hardest hit,” they continued.

On a volume-weighted basis, Black Book determined overall car segment values decreased 1.11%, as all nine car segments moved lower last week.

Analysts noted that four car segments sustained value declines greater than 1% last week, including:

—Compact cars: down 1.41%
—Near luxury cars: down 1.34%
—Prestige luxury cars: down 1.34%
—Sporty cars: down 1.31%

Black Book also pointed out that premium sporty cars posted the smallest price decline of the week at 0.33%, while the 0.75% value drop for subcompact cars marked the largest single week decline for the segment since August of last year.

Moving over to trucks, Black Book’s volume-weighted information showed overall truck values decreased 0.67% last week, which is consistent with the prior week’s decline of 0.75%.

Analysts said the price drop for small pickups at 0.98% led the way as all 13 truck segments posted declines. Compact crossovers were not far behind with a price decline of 0.94%.

Black Book discussed more observations gathered from the lanes to wrap its latest weekly analysis.

“Floors are still high, but buyer count is stable. The inventory is there and has been consistent over the last few weeks. Some sellers seem to be adjusting their floors and are off-loading inventory, while others continue to hold firm to floors. Many buyers continue to hold out for lower prices or better condition vehicles, but others were actively online competing,” analysts said.

“Large independent dealers and rental companies were very active challenging each other to the best bid. Franchise dealers were still bidding, but the large independent dealers and rental companies seemed to dominate over them,” they continued. “Overall, sales rates were down this week, but certain lanes had higher sales rates than we have recently seen. This could potentially mean that sellers will soften their floors and sales rates could potentially get better. We still have not seen flood vehicles from the hurricane coming through yet, but there is speculation that a lot of cars were damaged, and they will be coming through the lanes soon.

“Moving into the fourth quarter, we anticipate an increase in repossessions being offered in auction lanes and we are starting to see more coming through. Overall, it was another stable week with the market still decreasing,” analysts went on to say.

Turning back to Cox Automotive’s wholesale information, analysts also looked toward the remainder of the year as they recapped what they’ve seen happening so far in October.

Over the last two weeks, Cox Automotive said Manheim Market Report (MMR) prices produced lower-than-normal and slowing declines resulting in a 1.1% cumulative decline in the Three-Year-Old MMR Index, which represents the largest model-year cohort at auction.

Over the first 15 days of October, analysts explained that MMR Retention — which is the average difference in price relative to current MMR — averaged 98.2%, “which indicates that valuation models are ahead of market prices.”

Cox Automotive said the average daily sales conversion rate of 50.9% in the first half of October increased relative to September’s daily average of 48.8%, “and conversion rates typically decline in October.”

Analysts added, “The latest trends in key indicators suggest wholesale used-vehicle values should decline less than normal in the second half of October.”

Cox Automotive closed its update by noting all eight major market segments in its data set posted seasonally adjusted prices that were lower year-over-year during the first half of October.

Analysts indicated compact cars recorded the lowest price decline at 5.4%, while vans and pickups lost less than the overall industry in seasonally adjusted year-over-year changes.

Cox Automotive mentioned six major segments saw price decreases compared to September, with full-size cars and vans showing value gains of 10.2% and 0.2%, respectively.

All major segments also saw unadjusted price declines in the first 15 days of October, according to analysts.