ADESA Used Price Index drops for first time this year
Though wholesale prices remain elevated from 2014 rates, according to one reading, prices at auction took a dip for the first time this year in Canada.
The ADESA Canada Used Vehicle Price Index, powered by ALG, fell in September, after being adjusted for seasonality. Auction prices, on average, fell by 0.6 percent from August. This marks the first time this year the index has dropped at all.
Geoff Helby, ALG Canada regional director, reported that price movements this past month were nearly all negative. The only segment to see a prices increase was the midsize SUV category, with prices rising by $58 or 0.4 percent.
The compact SUVs “declined most rapidly,” Helby pointed out, with prices dropping by 12.6 percent or $1,777.
This segment was followed by the minivans, with prices dropping by 7.7 percent or $781 in September.
Midsize cars (down 7.1 percent or $628), mid-compact cars (down 3.8 percent or $292) and full-size pickups (down 2.3 percent or $515) all saw significant declines, as well.
New-vehicle sales continued to surge this past month, posting “yet another record month,” Helby said. This trend bodes well for used supply in coming years as some of these new sales come back through remarketing channels as trade-ins.
New sales last month increased by 3.7 percent year-over-year, reaching a total of 174,337 sales. Year-to-date, overall sales are up 2.5 percent, coming to a total of 1,461,132 vehicles sold.
“Yet another record month with September sales surpassing last year’s mark by a total of 6,296 units,” said Helby. “For the month, overall passenger car sales fell by 6.2 percent to 62,980 units, while light truck sales of 111,357 units, increased by a substantial 10.4 percent.”
Sales continue to reflect a shifting consumer interest in Canada away from cars and minivans, moving toward trucks and SUVs.
In a recent interview with Tom Kontos, executive vice president and chief client officer at ADESA Analytical Services, the analyst highlighted this trend in detail.
“New-vehicle sales in Canada in the last couple of years have been highly skewed toward trucks, primarily SUVs, whereas Canada historically has been much more concentrated in cars and minivans … And that sort of wave that the U.S. has been through for many years now, and now the CUVs, too, seem to be pretty popular in both countries, too,” Kontos said. “So the composition of what we are seeing at auction is starting to reflect the growth in popularity a few years back of SUVs and crossovers.”