7th Monthly Increase in Used Vehicle Price Index
MANHEIM CONSULTING -- Wholesale used vehicle prices (seasonally-adjusted basis) rose for the seventh consecutive month in July. The Manheim Used Vehicle Value Index for July was 115.4, an increase of 5.0% from a year ago.
Although cash for clunkers (C4C) and the resulting revitalization of new vehicle sales stole all of the headlines in July, used vehicle retail activity remained solid and higher residuals and recovery rates boosted the earnings of lenders and lessors. And, despite having to pay higher prices for inventory, dealers have seen an improvement in used vehicle retail gross margins.
From a previous Manheim Consulting report:
Some analysts have suggested that the rapid rise in wholesale used vehicle pricing is a precursor to an improvement in new vehicle sales and may even point to a recovery in the overall economy.
MP: The 1.3-point July increase in the Manheim Used Vehicle Value Index marked the seventh consecutive monthly increase (every month this year), following decreases in 10 out of the previous 14 months (from October 2007 to December 2008). The year-to-year increases in May (1.49%), June (5.84%) and July (5%) for the index follow 17 consecutive months of consecutive year-to-year decreases (Nov. 2007 to April 2009). Further, the July 2009 reading of 115.4 was the highest since September 2007, so the index is now back to a pre-recession level.
Originally posted at Carpe Diem.