Wholesale auction sales of vehicles up to 8 years old for the week ending Sept. 6 reached 87,000 units, which was an 11% improvement over the prior week’s 79,000-unit figure. Ultimately, sales for the week ending Sept. 6 were only slightly lower than what’s typically recorded for the period. It is important to note that sales for the week ending Aug. 30 improved by 6,000 units vs. what was initially reported due to lagged sales records.
Weekly Wholesale Auction Sales (thousands)
Segment-level auction sales on the mainstream side of the market improved an average of 9% for the week ending September 6. Gains were recorded across all mainstream segments as pickup and SUV segment sales increases outpaced their car counterparts. On the premium side of the market, sales grew 24% the week ending Sept. 6. Like the mainstream side of the market, premium segment sales increased across the board. Increases were generally led by SUV segments, however, large premium car sales improved by a massive 60%.
Wholesale Auction Prices Move Lower Once Again
After several weeks of slowing price appreciation, wholesale auction prices moved lower again the week ending Sept. 6 marking the third consecutive week of downward price movement. Prices last week were reduced an average of 1.2%, which was the largest decline recorded since April. As wholesale prices continue to soften, it’s important to remember that they remain 35% higher than their trough in April and 14% above their level at the beginning of March.
Weekly Wholesale Auction Price Index (Mar 1 = 100)
Wholesale prices for mainstream segments declined an average of 1.3% the week ending Sept. 6 when compared with the prior week. Prices on the mainstream side were down again across the board. Losses for the week for passenger car segments slightly outpaced the overall sector. In general, mainstream pickup and SUV prices performed better. Premium prices once again performed better than their mainstream counterparts. On average, premium segment prices were reduced an average of 0.5% for the week ending Sept. 6. While most premium segments experienced small price declines, large premium car and large premium SUV prices improved 0.9% and 0.2%, respectively.
Despite a slowing used market, wholesale prices remain strong. Prices are expected to continue to move lower through September and into October as pent-up demand has been satisfied and pandemic-related macro-economic headwinds increase. By year's end, prices are expected to be slightly greater than pre-virus levels. It is important to note, 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, overall employment conditions. Given these unknowns, a heightened degree of market volatility should be expected.