Used Prices Continue Monthly Declines Nearing 1%
After falling close to 1 percent in July, the ADESA Canada Used Vehicle Price Index was on the way down once again last month.
After being adjusted for seasonality, the index fell by 0.7 percent from July rates.
The index, powered by ALG, showed that all vehicle segments saw prices drop last month, except for the compact SUVs, whose prices held steady from the month before.
ADESA chief economist Tom Kontos explained Canadian consumer trends are contributing to the SUV’s strong price retention.
“The spikes in SUV prices are indicative of a changing social mindset in Canada. Many shoppers are seeing the benefit of having a larger vehicle, and consequently, demand for SUVs is pushing rates up,” said Kontos. “They are following Americans in that sense, leaning toward bigger units.”
This past month, the midsize cars saw the largest declines, dropping by 5.8 percent, or $535, followed by the midsize SUVs, which dropped by 4.5 percent, or $558.
Mid-compact cars also saw a significant decline, dropping by 3.9 percent, or $315. The minivans were up next with a 2.1 percent or $188 decline.
Full-size pickups, which are seeing price strength in the U.S., as well, experienced one of the smallest price declines last month. The segment saw prices drop by $99, or 0.5 percent, from July numbers.
Prices have been high in the lanes since the recession, but the tides may be turning. Rates in the lanes have started dropping this summer, and analysts at RVI are predicting prices will fall by 4 percent by 2017.
Editor’s Note: For more insight into used supply and prices, see our upcoming Power Supply feature. This will publish in the Auto Remarketing Canada Digital Magazine issue set to hit inboxes next week.