Dealers paid slightly more at auction in the first 15 days of August for the used cars they later sell. The news ends a long slide in wholesale prices and could foretell that a current drop in used car prices may not last long.
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.
It increased 0.1% in the first two weeks of August — a tiny change but the end of a slide that had seen wholesale prices fall more than 11% in recent months.
Wholesale price changes become retail price changes, usually after six to eight weeks. But that relationship has proven stubborn this summer. Retail prices finally dropped last month, with the average used car selling for 0.5% less than one month before.
The decrease may be short-lived, with dealers already paying more for stock.
Prices have been slow to decline because of pandemic-related supply problems.
Automakers built about 8 million fewer cars during the pandemic. Used car inventories could remain low for years as those cars never find their way to the used market, keeping prices higher than Americans had grown accustomed to.
Dealers ended July with about a 27-day supply of used cars for sale — well below traditional industry targets.
