Wholesale Prices Slide

By Staff Writer November 13, 2020

 

For the week ending Nov. 8, wholesale auction sales of vehicles up to 8 years old fell slightly, reaching approximately 82,000 units, according to J.D. Power’s Market Update on Nov. 12. Last week’s result marks the second consecutive week of slowing sales after four weeks of flat sales.

Ultimately, sales last week were approximately 19 percent lower than what’s typically recorded for the period and a 2-percent decline week over week, J.D. Power reported.

Prices on the mainstream side were generally down, however, large pickup and SUV along with midsize van prices were flat for the week. J.D. Power reported that remaining mainstream segment prices fell between 0.4 percent (small SUV) to 1.8 percent (midsize and small car). Premium prices performed slightly worse than their mainstream counterparts. On average, premium segment prices fell 1.2 percent. Premium prices were down across the board. Losses ranged between 0.2 percent (compact premium car) and 2 percent (large premium car).

Despite a slowing used market, wholesale prices remain strong, according to the report. Prices are expected to continue to move lower through the remaining weeks of November and December as pent-up demand has been satisfied and pandemic-related macro-economic headwinds increase. By year's end, prices are expected to be greater than pre-virus levels. J.D. Power added, however, that while the outlook is relatively optimistic, there remains a great deal of uncertainty surrounding the effect of new virus outbreaks, the potential for another round of federal stimulus and overall employment conditions. Given these unknowns, a heightened degree of market volatility should be expected.

Segment-level auction sales on the mainstream side of the market were mixed for the week ending Nov. 8. Across segments, sales volumes continue to drift lower across the board.

After several weeks of price declines, wholesale auction prices moved slightly lower again the week ending Nov. 8 marking the 12th consecutive week of downward price movement. Prices last week were reduced an average of 1 percent and have declined 8 percent since their peak in August. As wholesale prices continue to soften, they remain 25 percent higher than their trough in April, and 6 percent above their level at the beginning of March.

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Last modified on Friday, 20 November 2020 13:21