Car dealers paid nearly 1% less for used cars at auction in December than they did in November. Wholesale prices tend to become retail price changes after about six to eight weeks, so the change likely means lower prices for used car shoppers in late winter.
That news comes from Kelley Blue Book’s parent company, Cox Automotive, which also owns car auction giant Manheim — where car dealers go to buy used cars they later sell. The company’s Manheim Used Vehicle Value Index tracks those prices.
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The index finished 2024 up 0.4% from a year before, as the supply of used cars nationwide remains low. Automakers built fewer cars than planned during the height of the COVID-19 pandemic. That will constrain supply for years to come, helping keep prices high.
Used car retail prices increased in December, settling at $25,565 on average.
But dealers paid 0.8% less at auction, showing that a minor price drop is possible soon.
Used luxury cars saw the biggest drop, down 1.5% year-over-year. Compact cars fell 1.1%. Used truck buyers faced the toughest market, with their prices falling just 0.5% during the year.
The Conference Board Consumer Confidence Index declined 7.2% in December, far worse than the expected small gain. Consumers’ views of both the present and the future declined, with the view of the future plunging 13.4% to its lowest level since July. Consumer confidence was down 3.1% year over year. Plans to purchase a vehicle in the next six months also dropped to the lowest level since June.
