Wholesale Auction Values Booming

Following a year of plummeting wholesale auction values, Black Book is reporting a much improved market than in 2023.

Market Insights – 4/16/2024

Wholesale Prices, Week Ending April 13th, 2024

The overall market is still experiencing growth, yet there is a noticeable deceleration in the pace of these gains, and a growing number of segments are beginning to see a reversal into negative trends. Notably, the luxury segments exhibited a widespread downturn across all categories last week, with the Sub-Compact Luxury Crossover segment standing out as the sole exception to this declining trend.

On a volume-weighted basis, the overall Car segment increased +0.27%. For reference, in the previous week, cars increased +0.26%.
The 0-to-2-year-old Car segments were up +0.25% and 8-to-16-year-old Cars increased +0.18%. Four of the nine Car segments increased last week.
Although the growth rate has decelerated in many segments, both Compact and Mid-Size Cars bucked the trend, accelerating their gains last week with an increase of +0.51% and +0.55%, respectively.
For three consecutive weeks, the Sporty Car category has experienced growth, with the latest week seeing a +0.48% rise. Over this trio of weeks, it has maintained an average weekly growth rate of +0.44%.
While recent-model Luxury segments observed declines last week, save for the Prestige Luxury Car segment, the older luxury car categories, specifically those within the 8-to-16-year age range, sustained their upward momentum with continued gains.

The volume-weighted, overall Truck segment increased +0.09% compared to the appreciation seen the prior week of +0.23%.
The 0-to-2-year-old models gained +0.06% on average and the 8-to-16-year-olds decreased by -0.03% on average. This was the first time in five weeks the 8-to-16-year-old Trucks reported a decline in values.
Eight of the thirteen Truck segments increased last week.
Full-Size Vans have persisted in showing significant decreases, with the latest figures revealing a drop of -1.47%, following a substantial decline of -1.07% the previous week. This results in an average decrease of -1.10% for the segment over the course of the last three weeks.
Contrasting starkly with the Full-Size Van segment, the Full-Size Crossover/SUV category outperformed other Truck segments with the most substantial gain, rising by +0.65%. Over a span of six weeks, this segment has seen a consistent upward trend, averaging a weekly increase of +0.47%.

Weekly Wholesale Price Index

The graph below looks at trends in wholesale prices of 2- to 6-year-old vehicles, indexed to the first week of the year. The index is computed keeping the average age of the mix constant to identify market movements.

Wholesale

As we conclude the second week of April, the wholesale market maintains a rising trajectory. Full-Size vans, for the third consecutive week, have experienced greater depreciation than what has been observed in recent years. The influx of Full-Size Vans re-entering the market and a growth in new inventory might sustain this downward trend. It is also important to mention that Compact Vans have seen a drop in value, signifying their first decline in the past month. Auction conversion rates this week hit an annual high of 59%, marking an increase of 3% from the previous week.

As always, our team of analysts are focused on keeping their eye on the market for developing trends and gathering insight.