Amid almost relentlessly bad news for car shoppers, there remains one glint of hope. Used car prices have been falling in recent months and are likely to fall further.
The prices car dealers pay for the used cars they later sell fell 3% in September.
The Manheim Used Vehicle Value Index tracks the prices dealers pay for used cars at auction. It is a product of Kelley Blue Book parent company Cox Automotive. The index fell 4% in August.
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Compared to August, prices dropped for all eight kinds of vehicle the index tracks.
That’s not as true when we pull back to look at year-over-year numbers. With Americans tightening their belts amid bad economic forecasts, cheap, small used cars and work vehicles remain in demand. Compact cars saw their wholesale prices rise 5.9% since last September. Vans and trucks saw a 0.8% increase.
But every other segment of the market saw prices drop year-over-year.
When dealers pay less for cars, they can sell them for less and still collect a profit. And they need to sell them. Used car sales are slowing.
September retail sales were down 8% compared to August and down 10% compared to last September. America’s used car dealers have 17% more cars in stock to sell than they did a year ago.
