Saturday, May 09, 2009

4th Monthly Increase in Used Vehicle Value Index

MANHEIM CONSULTING -- April marked the fourth consecutive monthly increase in wholesale used vehicle prices on a mix, mileage, and seasonally adjusted basis. The Manheim Used Vehicle Value Index now stands at 106.6. That represents a year-over-year decline of 1.7%, but an increase of 8.8% since the beginning of the year.

This year's rise in wholesale pricing (and the strong conversion rate at auction) was initially driven by the steep falloff in new vehicle sales, which reduced the supply of trade-ins much more than the underlying demand for those units. Now, however, the stability in the used vehicle market appears to be more “despite of”, rather than “because of”, the weakness in the new vehicle market. As such, periodic setbacks in pricing may be experienced even though the supply/demand dynamics remain positive for used vehicle values.

From a previous 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.


At 5/09/2009 5:39 PM, Blogger Richard said...

Couldn't the value of used cars be going up due to plans by Congress to issue rebate checks for "trading in" gas guzzlers for more fuel efficient cars?

At 5/09/2009 6:04 PM, Blogger Hot Sam said...

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At 5/09/2009 8:20 PM, Anonymous Anonymous said...

Richard's explanation is not applicable. The value of used cars was going up long before Congress started it's plans to offer "cash for clunkers," which began just this past week.

Mr. Miller's explanation is well thought out, but he's seeing the trees instead of the forest. Right now, we're on pace to sell about 9 million vehicles per year in this country while we're sending about 13 million per year to the junkyard. Add population growth to the mix and anyone can plainly see this trend cannot continue much longer.

This IS yet ANOTHER green shoot, whether or not one cares to admit it.

At 5/09/2009 8:26 PM, Anonymous Anonymous said...

Here's some excellent commentary from Brian Wesbury over at First Trust on this green shoot:

At 5/09/2009 8:27 PM, Anonymous Anonymous said...

Sorry, the link was partially cut off in my prior post...hope it works this time!

At 5/09/2009 8:32 PM, Anonymous Anonymous said...

Alright, the link thing ain't workin' so anyone interested in the data can go to, click on the "Research and Commentary" link at the top, then click on Mr. Wesbury's "Economic Research and Advisory" link, then click on the "Auto Sales Update" under the Research Reports heading.

At 5/09/2009 9:17 PM, Blogger bobble said...

anon, thanks for the link.

this particular blog software doesn't handle long links well. in the future use to create a short link.

here's your link:

At 5/10/2009 2:15 AM, Blogger Hot Sam said...

This comment has been removed by the author.

At 5/10/2009 2:22 AM, Blogger Hot Sam said...

This comment has been removed by the author.

At 5/11/2009 7:46 AM, Blogger juandos said...

Hey anon @ 8:26 PM, is it this video by Wesbury?

Toxic Assets vs. Toxic Government


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