The prices dealers pay for the used cars they later sell declined in the first half of March.
The Manheim Used Vehicle Value Index tracks the prices car dealers pay for used cars at auction, adjusted to account for normal seasonal fluctuations. The index is a product of Kelley Blue Book parent company Cox Automotive. It’s usually a reliable predictor of what will happen to the retail prices buyers have to pay.
Used car prices soared to record highs throughout 2021, ending the year more than 43% higher than just one year earlier. But they have slowly receded through the first quarter of 2022 –- a positive sign for used car shoppers.
Compared to February, prices for nearly every type of used vehicle declined. Only vans saw an increase.
The wholesale price drop is good news for shoppers, but there is some uncertainty about used car prices.
Used car retail prices dropped in January, the most recent month for which data are available, after a year of steady increases. The average used car in America sold for $27,633 that month -– down $572 from where it stood in December.
But a normal seasonal increase caused by tax return season, together with high gas prices that might cause some consumers to seek out more efficient vehicles, makes analysts uncertain that the decreases will continue.
The supply of used cars available for sale decreased slightly in the first two weeks of March. Dealers count their stock in a metric they call days of inventory — how long it would take them to sell out of cars at the current sales rate if they stopped acquiring more. As of March 15, wholesale supply was at 26 days, down two days from the end of February but up four days year over year.
