Supported in part by lower listing prices, used-vehicle sales are expected to finish 2024 at 19.9 million, up 3.1% from 2023.
Wholesale values forecast to end 2024 lower by 0.6% year over year, underperforming long-term averages of an approximate gain of 2.3%.
With the Manheim team monitoring activity closely following Hurricane Helene, initial data suggests no storm-related surge in demand nor increase in vehicle values.
ATLANTA, Oct. 7, 2024 /PRNewswire/ — Data released today by Cox Automotive showed that, after two months of increases, wholesale used-vehicle prices (on a mix, mileage, and seasonally adjusted basis) reversed course and were lower in September by 0.5% compared to August. The Manheim Used Vehicle Value Index (MUVVI) fell to 203.0, a decline of 5.3% from a year ago.
The seasonal adjustment to the index amplified the change for the month, as non-seasonally adjusted values fell only slightly. The non-adjusted price in September decreased by 0.1% compared to August, moving the unadjusted average price down 4.9% year over year.
“Wholesale values reversed course and turned negative over the month of September after rising in July and August,” said Jeremy Robb, senior director of Economic and Industry Insights at Cox Automotive. “Non-adjusted prices usually decline in September, and while that occurred this year, prices fell less than they normally do for the month. Retail used days’ supply remains at lower levels than the last few years, and off-lease maturities will continue to decline. The new normal is likely that we continue to see wholesale depreciation; but it may be more muted than the market is accustomed to for the rest of the year.”
Consumers continue to see used-vehicle prices that are lower year over year, which is supporting higher retail used-vehicle sales. According to Cox Automotive’s vAuto Live Market View data, the average retail listing price for a used vehicle, at $25,278, is now lower by 0.7% over the last four weeks and lower year over year by approximately 6%. Used retail vehicle sales in September were down compared to August, but higher year over year by 9% and are expected to finish 2024 at 19.9 million, up 3.1% year over year.
Hurricane HeleneWhile the human toll of Hurricane Helene has been significant and the full measure of the devastation is still being determined, initial estimates are that used vehicle demand and prices will not be materially impacted to the extent seen in the aftermath of Hurricane Harvey, which came ashore in Houston in August 2017. Harvey was a perfect storm in that there was a significant lack of warning and preparation; Harvey was a slow-moving storm characterized by significant flooding across a high-population, vehicle-dense area, with Houston being the fourth most populous city in the U.S.
The Manheim team is monitoring activity closely to see if patterns emerge that appear similar to those measured after major storms such as Hurricane Harvey, Sandy and Katrina. So far, data suggest no surge in demand nor increase in vehicle values, but wholesale and used retail supply is currently tight, so conditions are right for wholesale values to increase (or decline less than normal for this time of year).
Updated 2024 MUVVI Forecast and OutlookThe revised outlook for used-vehicle values at the end of 2024 shows a decline of 0.6% year over year, implying fairly flat movement in the fourth quarter.
“September was a return to normal in many ways,” added Cox Automotive Chief Economist Jonathan Smoke. “September performed slightly better than anticipated compared to our historical data and our expectations are Q4 will follow suit: All signs indicate that used vehicle values will remain flat through the remainder of the year.”
Next year, with even fewer lease maturities, the Cox Automotive team is expecting depreciation trends will be reduced versus what is typically seen. The outlook for values at the end of 2025 is up 2.4%, and the initial estimate for 2026 is to see a gain of 2.6%. With the long-term bias move in the MUVVI index at +2.3%, this means slightly lower overall depreciation in wholesale values is expected in the years ahead.
For more perspective on the Manheim Used Vehicle Value Index performance in September and Q3, visit the Cox Automotive Newsroom:LINK TO COMMENTARY
LINK TO PRESENTATION
About Cox Automotive Cox Automotive is the world’s largest automotive services and technology provider. Fueled by the largest breadth of first-party data fed by 2.3 billion online interactions a year, Cox Automotive tailors leading solutions for car shoppers, automakers, dealers, retailers, lenders, and fleet owners. The company has 25,000-plus employees on five continents and a family of trusted brands that includes Autotrader®, Dealertrack®, Kelley Blue Book®, Manheim®, NextGear Capital™, and vAuto®. Cox Automotive is a subsidiary of Cox Enterprises Inc., a privately owned, Atlanta-based company with $22 billion in annual revenue. Visit coxautoinc.com or connect via @CoxAutomotive on X/Twitter, CoxAutoInc on Facebook, and Cox-Automotive-Inc on LinkedIn.
SOURCE Cox Automotive
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