Wholesale used vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) increased 3.64 percent month-over-month in August. This brought the Manheim Used Vehicle Value Index to 163.7, a 15.8 percent increase from a year ago and a record high for the Index.

Manheim Market Report (MMR) prices improved at a decelerating pace over the four full weeks of August, resulting in a 1.6 percent cumulative increase on the Three-Year-Old Index. In the last full week of August, the Three-Year-Old Index declined 0.1 percent, ending the streak of 16 weeks of price appreciation. MMR Retention, which is the average difference in price relative to current MMR, averaged 100.5 percent for the month and ended the month under 100 percent for four of the last five days. Likewise, the sales conversion rate declined over the course of August but remained higher than normal for this time of the year.

On a year-over-year basis, all major market segments saw seasonally adjusted price increases in August. Luxury cars and pickup trucks outperformed the overall market, while most other major segments underperformed the overall market.

According to Cox Automotive estimates, total used vehicle sales volume was down 4 percent year-over-year in August. Cox estimates the August used SAAR to be 38.0 million, down from 39.7 million last August and flat compared to July. The August used retail SAAR estimate is 20.3 million, down from 20.7 million last year and slightly down month-over-month from July’s 20.4 million rate.

 

Used vehicle prices have recovered as the supply of used vehicles has come down. Using a rolling seven-day estimate of used retail days’ supply based on vAuto data, we see that used retail supply peaked at 115 days on April 8. Normal used retail supply is about 44 days’ supply. It ended August at 38 days, so lower than normal. Cox estimates that wholesale supply peaked at 149 days on April 9, when normal supply is 23. It was down to 24 days by month end.

August total new vehicle sales were down 19 percent year-over-year, with two fewer selling days compared to August 2019. The August SAAR came in at 15.2 million, a decrease from last year’s 17.1 million but up from July’s 14.6 million rate.

The average price for rental risk units sold at auction in August was up 8.4 percent year-over-year. Rental risk prices were up 2 percent compared to July. Average mileage for rental risk units in August (at 39,500 miles) was down 17 percent compared to a year ago and down 15 percent month-over-month.

 

Manheim Used Vehicle Value Index August 2020
163.7 15.8 percent/January 1995 = 100

 

Manheim has added six more sites to its list of in-lane bidding (Digital Block) locations. This brings the total number of Manheim in-lane bidding sites to 43.

“As we continue with our reopening plans, we’re hearing positive feedback from dealers about in-lane bidding at our pilot sites,” said Manheim’s division vice president Alan Lang. “After ongoing safety reviews, we will add six additional sites beginning Aug. 24, bringing the total to 43 locations… We continue to be intentional with our decision to expand the program, as health and safety remain at the center of everything we do. Should the data continue to support a safe environment for team members and clients, we anticipate adding more locations.” 

The six sites include Manheim Riverside, Manheim Southern California, Manheim San Diego, Manheim California, Manheim San Francisco and Manheim Tucson.

Manheim’s Lot Vision vehicle tracking system is now in place at 19 Manheim sites. Lot Vision was deployed at Manheim Tucson and Manheim New Jersey earlier this month.

Manheim added six additional locations to its in-lane bidding pilot sites this week.

Starting June 20, Manheim El Paso, Manheim Hawaii, Manheim Louisville, Manheim New England, Manheim NY Metro Skyline and Manheim St. Louis are featuring in-lane bidding.

There are now 35 sites reopened to in-lane bidding since the COVID-19 shutdowns.

Due to rising infection levels in California, Manheim has delayed the pilot of in-lane bidding at Manheim Fresno.

Manheim began adding 12 sites to its list of in-lane bidding pilot sites starting July 6.

Digital Block sales offer in-lane bidding at Manheim physical auctions with a live auctioneer and Simulcast. The vehicle never physically moves across the block during the auction process; it is only displayed on-screen. As the safety of Manheim’s team members and clients remain the company’s top priority, in-lane bidding pilots could be postponed if rising pandemic levels occur.

“As we continue to move forward with our re-opening plans, we saw great success with our return to in-lane bidding at our five initial pilot sites,” said Alan Lang, Manheim’s division vice president. “After two weeks of safety reviews, we are now ready to expand to 12 additional locations. For all pilot sites, we established strict safety protocols, including requiring facial coverings, social distancing and a daily review of pandemic data in each market.”

Sites added the week of July 6 include: Manheim Utah, Manheim San Antonio, Manheim Denver, Manheim Nevada, Manheim Cincinnati, Manheim Cleveland, Manheim New Orleans, Manheim Lafayette, Manheim Albany, Manheim Poplar Bluff, Manheim Little Rock and Rome Auto Auction, GA (digital sale operated using Manheim technology and staff).

While Manheim Pennsylvania’s 75th Anniversary activities were postponed due to COVID-19, record vehicle demand from dealers in June is a reason to celebrate. Manheim’s flagship auction location sold more than 8,200 of the approximately 10,000 vehicles offered for sale digitally during the week ending June 19. This digital sales week beat last year’s combined physical and digital sales week by almost 900 vehicles. Using Simulcast, OVE.com and Manheim Express, nearly 9,000 dealer buyers participated virtually, showing dealers’ ability to keep their businesses moving forward by leveraging the digital wholesale marketplace.

“While we weren’t able to host our in-lane anniversary sale in March due to COVID-19, we could not be happier about meeting the demand from dealers for vehicles during this most recent week in June,” said Joey Hughes, vice president and general manager at Manheim Pennsylvania.”

The company allowed sellers to represent vehicles on the block and piloted in-lane bidding at five of its sites beginning the week of June 22. Both decisions were made after establishing strict safety protocols based on COVID-19 guidance.

While in-lane physical sales with cars running down the lanes have halted, Simulcast participation nearly tripled since early April, hitting approximately 20,000 attendees each day starting in mid-June and experiencing an 81 percent increase in OVE.com sales in one week. In addition, the company experienced approximately 1 million digital transactions from January through May, weeks ahead of the same time last year.

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