Americans bought 12% fewer used cars this June than they did in June 2020.
Cox Automotive, parent company of Kelley Blue Book, estimates that Americans bought 3.2 million used cars in June. They bought more than 3.6 million last June.
The seasonally adjusted sales rate – a measure that removes normal seasonal fluctuations to make it easier to compare one month to another – sat at 39 million at the end of June. It stood at 43.6 million at the end of last June.
Supply Improving, Though Still Low
Low supply has hampered used car sales all year. In June, Cox Automotive found, dealers had just 34 days’ worth of cars to sell – 11 fewer than the same month in 2019, the last pre-pandemic sales year. Supply is expected to modestly improve, but inventory levels are not likely to return to higher 2019 levels until 2024.
Retail Prices Hit All-Time High in May
The prices buyers pay for used cars hit an all-time high in May. The average list price for a used vehicle in the U.S. rose to $24,414 at the start of June. That’s nearly $2,000 higher than the previous record, set just a month before.
June’s figures aren’t available yet. But there are indications that prices could have begun a slight decline last month.
Wholesale Prices May Have Peaked
The Manheim Used Vehicle Value Index tracks how much used car dealers pay for the cars they later sell. It had seen stunning increases since the COVID-19 pandemic began to rock the economy. Wholesale prices rose more than 60% between May 2020 and May 2021.
The index decreased by 1.3% in June.
“Based on our data, it’s clear that supply and demand are more in balance and may be tilting slightly to favor buyers,” said Cox Automotive Chief Economist Jonathan Smoke. “There are still supply constraints and will be for some time, but we anticipate that substantially inflated used vehicle values will erode by 9% between now and the end of 2021.”
