According to mid-month data, wholesale prices of used vehicles increased by 1.6% in the first half of November compared to October Manheim Used Vehicle Value Index released November 19th.
The index also reported that monthly wholesale vehicle prices increased 0.5% compared to November 2023. Typically, wholesale costs paid by dealers decrease slightly in Novembermeaning mid-month data showed “much less depreciation than usual,” according to a data analysis published last month from Cox Automotive.
According to Cox’s analysis, in addition to the trend of increasing prices, the supply of used vehicles at both wholesale and retail levels also decreased in October.
“With sales conversion rising for six weeks straight, it’s not surprising to see strength in wholesale pricing in early November,” Jeremy Robb, senior director of economics and insights at Cox Automotive, said in a note .
Additionally, the analysis found that retail sales of used vehicles have increased over the past month. “This should keep retailer demand for wholesale units high in the coming weeks,” Robb said.
The Used Vehicle Index published by Manheim, a subsidiary of Cox Automotive, measures used vehicle price trends based on its sales database of millions of vehicles purchased by dealers at auctions. Manheim is the largest used vehicle wholesale market in the world.
According to the Federal Reserve, used car prices are subject to “extreme volatility.However, the Manheim index adjusts values for seasonality, vehicle class and mileage to correct for price deviations based on vehicle mileage or the mix of vehicles for sale.
For Manheim, the index is “an early indicator of what will be seen in the used retail market.”