Auctions

Manheim Index stretches record-setting streak to 6

ATLANTA - 

Make it six months in a row that the Manheim Used Vehicle Value Index has set a new record high.

Cox Automotive reported this week that wholesale used vehicle prices (on a mix-, mileage- and seasonally adjusted basis) increased 1.02 percent month-over-month in October. This rise pushed the index reading to 136.3, which was a record high for the sixth consecutive month and an 8.1-percent increase from a year ago.

On a year-over-year basis, all major market segments again saw gains, including midsize cars. SUVs/CUVs, pickups and vans, which outperformed the overall market with increases of 8.8 percent, 11.7 percent and 9.2 percent, respectively.

“Though wholesale market values continue to show strength as a result of growing retail demand, most of this price strength can be attributed to the recovery following Hurricane Harvey and Hurricane Irma,” Cox Automotive chief economist Jonathan Smoke said in commentary that accompanied the index update.

“Replacement demand combined with a reduction in available supply has caused wholesale inventories to tighten,” Smoke continued. “The impact to the wholesale market was widespread, resulting in abnormal wholesale price gains for another month.”

The last time the index generated an upward march this long came at the end of 2011 into the first part of 2012. That’s when the reading went from 122.8 in October 2011 up to 126.2 in March 2012.

As they were then, used vehicles now are rolling over the curb at a good clip.

According to Cox Automotive estimates, used-vehicle sales improved by 3 percent year-over-year in October. The October used SAAR decreased to 39.7 million units from September’s 41 million.

Smoke  indicated the retail growth in used sales is coming from vehicles less than 4 years old, which have grown 14 percent year-over-year, year-to-date. 

Vehicles less than 4 years old represent the largest age segment of vehicles in the used-car market,” he said.

And one other note on the wholesale market, Cox Automotive reported that rental risk pricing improved in October, as well.

The average price for rental risk units sold at auction in October was up 4 percent year-over-year. Rental risk prices were down 3 percent compared to September.

Cox Automotive added that average mileage for rental risk units in October at 42,500 miles was 1 percent above a year ago.

Smoke wrapped up his analysis by noting the U.S. economy “continues to chug along.”

Smoke relayed that the first estimate of real GDP growth in the third quarter came in at 3.0 percent, beating expectations of 2.6 percent growth.

“Two consecutive quarters of 3 percent or greater growth is a positive improvement, as we have not seen two such strong quarters in a row since mid-2014,” Smoke said. “After declining in September, consumer sentiment rebounded in October, with the final reading from the University of Michigan coming in at 100.7, its highest level since the start of 2004.

“Households are feeling more upbeat about the outlook for the U.S. economy, which is a solid leading indicator of consumer spending and the rest of the economy in the fourth quarter,” he went on to say.


New NAAA chief wants auction jobs to become industry careers

PALM SPRINGS, Calif.  - 

Warren Clauss knows first-hand that auction industry jobs can lead to dynamic careers.

The former certified public accountant snagged the controller job at the Auto Dealers Exchange Buffalo, in Akron, N.Y. — then owned by ADESA founder Mike Hockett, who went on to found Auction Broadcasting Co. — when the site opened in 1992.

Two years later Clauss became its assistant manager and two years after that, he was named its general manager. The site was renamed ADESA Buffalo when ADESA changed ownership in the mid-1990s.

ADESA is currently owned by KAR Auction Services Inc. Through it all, Clauss remains its general manager.

His already impressive resume gets even longer when he takes over as president of the National Auto Auction Association at its annual conference in Palm Springs, Calif.

The NAAA Convention is held in partnership with the as part of AuSM’s .

Among his goals for the coming year is to brainstorm with other auction leaders about ways to attract career-minded employees to the industry and keep them in the fold.

“We’ve all struggled with hiring and recruiting,” said Clauss.

He takes over the presidency from Jerry Hinton, who will become NAAA chairman. Hinton is general manager of ADESA Portland, in Portland, Ore.

“I’d like to collaborate with industry leaders whether they’re with ADESA, Manheim, independents, to see if we can do anything different or better from a recruiting perspective,” Clauss said. “Kids coming out of school may or may not realize there are some career opportunities in the NAAA industry. There are hundreds of job opportunities collectively throughout the country.”

Among those opportunities are management positions in auction body shops and in finance and transportation departments, he said. There are also positions in sales and labor jobs such as service technicians.

How to promote the array of jobs available at auctions is still in the planning stages and could involve recruiting at trade schools, community colleges and four-year colleges and universities, Clauss said.

Scholarships might help

NAAA’s Warren Young Sr. Scholastic Foundation, which awards scholarships totaling $52,000 annually in a dozen merit scholarships might be helpful, he said.

“It could be that with these scholarships, when we honor students, we stay in touch with them,” Clauss said. “We need to do a better job advertising who we are, what we do and what we have available.”

Still, this is a good time to be in the auction business. A widely anticipated and significant industrywide increase in off-lease volume means more vehicles being sold at NAAA member auctions and more opportunities to sell ancillary services, Clauss said.

But conversely, with those greater opportunities come greater challenges. This is especially true when it comes to meeting customers’ expectations when providing services such as inspecting, cleaning and performing mechanical and body work on vehicles, he said.

“Throughput becomes a concern,” Clauss said. “But we all have these processes and procedures and we’re able to handle (those tasks) with a turnkey approach. Most of us have the facilities and the workforce to make it happen as the volume is increasing.”

Like the three previous NAAA presidents, Clauss will continue to emphasize auction safety during his presidency. The push for greater safety awareness in auctions includes online training in a wide variety of topics such as distracted walking, falls and driving safety.

Add OSHA training

Clauss would like to add Occupational Safety and Health Administration classes to the curriculum for some employees.

The 10-hour class would be targeted to auction supervisors and managers of people and are designed to ensure that workers are knowledgeable about workplace safety and health hazards.

“It would be up to each individual auction to determine whether and who should take (the class) and how frequently,” Clauss said.

In his spare time during the summer, Clauss can be found on the golf course a couple of times a week — he has a 12 handicap — with a few golfing buddies.

But from about August through March, find him on the ice officiating USA Hockey games for high-school age and younger children. Clauss played hockey while in high school and college and coached his sons, Hans and Theodore, who also grew up playing hockey.

“When my kids were in grade school — which is when I (officiated ice hockey) back in the day — I asked them if they would be interested in becoming an on-ice hockey official. I told them I did it I when I was their age under the encouragement of my mom. I said ‘if you get your credentials, I’ll get my credentials again’. It was nice officiating with them, father and sons.” Clauss’ sons are grown and no longer involved in hockey.

He also has a daughter, Grace, and has been married to wife, Molly, for 29 years.


Dealers back off inventory build, triggering price reaction

LAWRENCEVILLE, Ga. - 

Whether it’s just a momentary slowdown or the sign of a longer-term dealer trend, Black Book watched vehicle depreciation slightly intensify as store managers opted not to load up on potential inventory coming through the auction.

The latest Black Book Market Insights report shows both car and truck segments decreasing more in value than usual. Although car segments saw an overall larger depreciation, editors noticed two truck segments saw larger price declines as a percentage than any of the car segments.

“Depreciation rates increased on both car and truck segments as buyers become hesitant to load up on inventory,” said Anil Goyal, senior vice president of automotive valuation and analytics at Black Book.

Black Book’s representatives in the lanes back up Goyal’s assertion beginning with what the lane watcher in Florida reported back to headquarters.

“More no sales than the past few weeks as buyers don’t seem to be speculating at all,” said the representative in the Sunshine State.

Next door in Georgia, a similar story unfolded as Black Book’s watcher said, “A large quantity buyer says that he will wait until the sellers lower their floor prices, which he believes is just around the corner.”

Out West, the sentiment continued with dealers not ready to gamble in Nevada.

“The market remains good but dealers are cautious about over supplying their retail lots in the event of a downward market pivot,” Black Book’s representative said.

And in Arizona, the lane recap was, “More hesitation in the bidding process this week, which produced a noticeable amount of no sales.”

The impact of those dealer decisions meant that based on volume-weighted data, overall car segment values declined by 0.60 percent last week. In comparison, the market values had decreased on average by 0.41 percent per week in the previous four weeks.

Among cars, editors determined the full-size car and sporty car segments performed the worst, decreasing by 0.94 percent and 0.82 percent, respectively.

Again looking at volume-weighted data, Black Book reported that overall truck segment values — including pickups, SUVs and vans softened by 0.40 percent last week, worse than the average decrease of 0.25 percent per week recorded during in the previous four weeks.

Among trucks, editors noticed the sub-compact crossover and compact van segments performed the worst last week, dipping by 1.03 percent and 1.13 percent, respectively.

Specialty market update

As the editors do on a monthly basis, Black Book also offered its latest assessment of the specialty segments of the wholesale market. Here is the rundown:

— Collectibles: Editors indicated most segments of the collectible car hobby have done well at the various auctions held so far this fall.

— Recreational vehicles: Black Book reported values of both motorized and towable units sold at wholesale auctions increased once again this past month, “which, as we said last time, is unusual for this time of year,” according to the editors.

— Powersports: Black Book said November finds the powersports market in a leveling off period. “Changes in value this month are more subdued than we have seen recently,” editors added.

— Heavy-duty: Black Book calculated a good supply of units in several segments helped to maintain steady depreciation in October. Editors noted that construction/vocational group values have dropped the most since August, but still bring strong numbers.

— Medium-duty: Black Book acknowledged the wholesale market continues its downward trend. However, some late-model unit prices have stabilized,” editors said.


Podcast: Grace Huang & Nick Peluso of Cox Automotive

CARY, N.C. - 

The same week she was named president of Cox Automotive Inventory Solutions, Grace Huang joined the AuSM Podcast, along with Cox Automotive's Nick Peluso.

In this late-September interview, they join Joe to talk auction strategy at Manheim, RMS Automotive, autonomous vehicles, digital strategies and more.

Check out the conversation below.

Download and subscribe to the AuSM Podcast on  or on . 

You can also listen to the latest episode in the window below. All episodes can be found on our  or by visiting ausm.info/ar-podcast.

Please complete ; we appreciate your back on the show!

 


ACV Auctions CEO aims to change wholesale via tech

CARY, N.C. - 

Entrepreneur George Chamoun is driven by his desire to change the wholesale industry via technology as head of ACV Auctions.

After graduating from the University at Buffalo in 1997, the North Syracuse, N.Y., native would go on to launch technology and services company Synacor with his college roommate Darren Ascone, a year later.

Chamoun, an early angel investor in ACV, spent two decades leading Synacor as president of sales and marketing prior to joining ACV.

ACV Auctions’ recent procurement of $15 million in venture funding in a Series B investment from a Silicon Valley-based firm is is the largest the company has received since it began operations in 2014.

That $15 million in venture funding, which occurred not long after Chamoun became CEO,  was led by Bessemer Venture Partners.

In September 2016, the company had announced that it both brought aboard Chamoun and raised $5 million in venture funding, led by Tribeca Venture Partners, with participation from SoftBank Capital NY, Armory Square Ventures and Rand Capital.

“It’s my job to lead the company to be a very success oriented company,” Chamoun said in an interview with AuSM. “We’re growing the business in a very, very exponential way — growing in hitting all of our goals and objectives that we’ve set for ourselves. We’re out there growing four new markets a month. We’re going strong from Buffalo all the way down to just now entering in Florida.”

“It’s helpful that I spent 20 years building a technology company where we utilized technology to change the way businesses and consumers operate. It started out with email many years ago. We were a company that operates email services, and back then that was a new service 20 years ago,” Chamoun explained.

When asked about the similarities between his prior and current role Chamoun said his commitment to growth as a leader remains the same.

“The commonality is that you’re hiring great people to build great technology, to service very important customers and changing the way the industry works and in a way adding value via technology and people, to help an industry grow and become better.”

ACV has continued to add markets this year and has plans to do even more expansion. 

“We’re very core mission-driven, everything we do is about trust and transparency, so we’re leveraging technology and our people know the trusted and transparent platform,” Chamoun said. “ And we’ve got the capital partners and investors who all believe in our mission and funded our business to help us have the capital needed to grow at a rapid rate.”

 


Roundup: Auction charity sale, expansion & more

CARY, N.C. - 

During the President’s Gala held during next week’s NAAA Annual Convention festivities in the , there will be a new fundraiser (Chapter Charity Auction) to benefit five charities.

The Gala itself is on Nov. 16 from 7 p.m. (PT)  to 9 p.m.

In addition to identifying the four charities to support, each NAAA chapter selected four exclusive items to go on the block for the charity new sale.

The auction items include a two-day high performance driving course package, a men’s Rolex watch with a gold NAAA logo, a 2018 Masters Golf Tournament package, along with a his and her Rolex and Louis Vuitton package featuring a two watches paired with a wallet and mini purse.

Proceeds from the sale will go to House in the Woods, St. Jude Children’s Research Hospital, Lynnway Accident Fund, Victory Junction and the American Cancer Society.

Calif. auction gears up for new expansion

AVDA Auction recently announced plans to add a fourth lane to its newly expanded location in North Hollywood, Calif. in January.

The company said its upcoming expansion is in response to high weekly inventory at the auction.

The location runs approximately 900 cars weekly, with highline vehicles making up about 20 percent of the inventory, according to AVDA.

“AVDA Auction the simple choice in auto auctions and has become a must-attend auction for dealers who are looking to buy or sell highline units,” AVDA Auction vice president Justin Soghomonian said in a news release. 

KIA joins CFAA

On Oct. 25 Kia Motors America began selling its vehicles through Columbus Fair Auto Auction.

“We are pleased to welcome Kia Motors America to Columbus Fair Auto Auction,” CFAA chief executive officer Alexis Jacobs said in a news release.

“As we continue to differentiate ourselves in the auction community, Kia will be the beneficiary of our targeted marketing approach and our willingness to experiment with technology to nurture our buyer base.”

This sale, along with all sales at CFAA, can be accessed via simulcast and on IAS Marketplace and CFAA.com.

“CFAA has a unique strategy that addresses the roles and responsibilities of each department as well as specific buyer needs through social media and client management,” added David Crockett of Kia Motors America. “CFAA’s approach to client engagement bodes well with Kia’s strategy to reach and assist Kia dealers.”


2 ingredients keep Black Book index moving higher

LAWRENCEVILLE, Ga. - 

Black Book sees two elements coming together to prop up used-vehicle prices and, in turn, push its Used Vehicle Retention Index higher for the second month in a row.

Black Book recently released its October index and noticed an increase of 0.6 percent month-over-month from 113.9 to 114.6. It’s the second straight monthly increase dating back to August when the reading stood at 112.6.

The Black Book Used Vehicle Retention Index is calculated using Black Book’s published wholesale average value on 2- to 6-year-old used vehicles, as a percent of original typically-equipped MSRP. It is weighted based on registration volume and adjusted for seasonality, vehicle age, mileage and condition.

Black Book explained the last remaining expected replacement activity stemming from Hurricanes Harvey and Irma drove continued vehicle valuation stability and shopping demand during the month of October.

During the month, vehicle segments such as compact crossover SUV (up 1.3 percent), full-size car (up 1.3 percent), full-size crossover SUV (up 1.7 percent) and full-size pickups (up 2.0 percent) were a few of the categories that saw noticeable retention strength due to increased demand during October.

“So far this year, we have seen a very strong performance for used-vehicle value retention, driven largely by the surprising value shoppers found in the affordable smaller cars after spring, and the huge demand resulting from hurricane replacements in the fall,” said Anil Goyal, senior vice president of automotive valuation and analytics for Black Book.

“Looking ahead in the next two months, we expect the market to decline slightly but still end this year with a better-than-expected strength in used vehicle values,” Goyal continued.

The index dates back to January 2005, where Black Book published a benchmark index value of 100.0 for the market.

During 2008, the index dropped by 14.1 percent while during 2016, the index fell by just 6.4 percent. During 2011, the index rose strongly from 113.3 to 123.0 by the end of the year as the economy picked up steam and used vehicle values rose higher.

The index continued to remain relatively stable, rising slightly until May 2014 when it hit a peak of 128.1.

To obtain a copy of the latest Black Book Wholesale Value Index, .


Manheim appoints 2 new Southeast GMs

ATLANTA - 

Manheim recently announced it has appointed Noel Kitsch as general manager of Manheim Georgia and Joey Satfield as general manager of Manheim Fort Myers.
 
Kitsch most recently served as senior assistant general manager at Manheim Central Florida.

He joined Manheim in 2001 as a dealer sales representative before taking on various roles with increasing responsibility, according to the company.

Kitsch’s past roles include acting as both the assistant general manager and dealer services manager at Manheim Orlando as well as serving as assistant general manager at Manheim Dallas.

“Noel’s record of exceeding company goals and client expectations, along with his ability to build strong client relationships and effective teams, make him a terrific fit for Manheim Georgia,” Manheim regional vice president, Southeast Mark Ford said in in a news release.

Satfield most recently worked in partnership with clients utilizing Cox Automotive products and services as assistant general manager at Manheim Kansas City.

He served as dealer services manager at Manheim Orlando prior to his role at Manheim Kansas City.

“In his new role, Joey will help Manheim Fort Myers deliver strong year-end results for Manheim and its clients,” said Tim Janego, Manheim regional vice president, East.

Satfield began his career at Manheim in 2013 as a field sales representative at Manheim Lakeland.


KAR leaders talk hurricanes, acquisition strategy & more

CARMEL, Ind.  - 

It was quite the quarter and it has been quite the year for KAR Auction Services.

The multi-pronged impact from two hurricanes that bear some influence on KAR’s whole-car and salvage auction businesses.

Purchasing DRIVIN and Dependable Auto Shippers, and buying the remaining interest in TradeRev.

All while keeping pace with a dynamic wholesale marketplace that is going increasingly digital, as business unit ADESA’s latest gain in online sales would indicate.

Shortly after KAR released its quarterly earnings, chief executive officer Jim Hallett and chief financial officer Eric Loughmiller talked with AuSM by phone about some of these matters and more.

Salvage impact from hurricanes

In terms of how it affected the company’s operations, Hurricane Harvey’s wrath in Houston — with its extreme flooding — outweighed the impact from Hurricane Irma in Florida.

“For Insurance Auto Auctions, it means getting into the market. It means acquiring additional land, getting the equipment,” Hallet said, including items like loaders, IT equipment, mobilizing the “ground force” and having the tow-truck driver network en route quickly.

“That all takes a lot of effort and a lot of focus, and the IAA team has really done a good job,” Hallett said. “We’ve learned from past experiences and we’ve put together what we call a CAT team. And the CAT team is ready to respond at any given event.

“But then, we’re also able to add resources from across the entire KAR network, where we had a number of employees volunteer to go and work with the IAA team,” he said, saying it was a nice boost for the company.

However, he emphasized that the “the real work starts happening long after the music stops, after the press stops writing about it.”

IAA is beginning to process those storm-impacted vehicles. It had sold less than 1,000 flood vehicles in the third quarter, Hallett said, but more of those cars are going to be sold over next two quarters.

“It sounds like it’s great, we get all this volume. But in order for us to be efficient, process as quickly as possible — which meets the demands of the insurance companies — we incur a lot of costs, so we don’t make any money,” Loughmiller, the KAR CFO, said of the IAA impact.

“It’s not like our normal business. So it’s volume that doesn’t produce profits. In every other major storm, though, the period that follows is typically very good for the industry,” he said. “Because while those cars are being sold, we find that cycle times slow down on collisions and things like that. So it’s historically been good for our business following the period in which we sell those vehicles.

“It will not be a long-term negative in the case of Harvey and Irma, but it will be revenue that won’t generate a lot of bottom-line profit,” Loughmiller said.

Online ADESA volume spikes

Turning to the ADESA whole-car auction side of the business, Hallett said the impact of the storms largely had a boost: “There was some slight shutdowns and slowdowns at ADESA physical auctions, just because the storms kind of brought things to a halt in that area. But overall, there were a lot of cars lost in that Houston market. And again, nobody knows for sure how many cars have been lost. We’ve heard all kinds of numbers.”

Suffice to say, it’s in the hundreds of thousands, Hallett said. “All those cars need to be replaced.”

There are 13 ADESA auctions that are within a couple of hours of Houston, Hallett said, and those were “very active” in the storms’ aftermath.  

“But maybe more active was our OPENLANE technology platform,” he said.

“Because that platform reaches across the entire nation,” Hallett said, “and you don’t have to wait until sale day to buy a car. You can buy a car 24/7, any day of the week. So, those sites were very, very active. They sold a lot of vehicles online. Our online sales were up 34 percent in the quarter, and our physical sales were down 1 percent.”

The 34-percent spike in online volume was “not totally, but heavily impacted” by the storms, Hallett said.

It also was the highest growth rate they had experienced since the first half of 2014, which was early stages of the cyclical recovery, Loughmiller said.

And not only does this illustrate just how much online buying there was, it also speaks to KAR’s strategy of offering “all the venues” wherever dealers want to buy the vehicles, Loughmiller said.

So what else drove such a massive spike?  Loughmiller points out, “that’s where the supply starts (at) what we call the top of the funnel … I don’t know that it was demand-driven.

“If you read what the dealers are saying, they’re actually selling the cars now,” Loughmiller said. “Those dealers in Texas knew they had to start accumulating inventory for when the buyer came to their lot.”

Since the inventory was showing up online first, dealers thought it prudent to buy there because there was a “good chance” it would have been sold before the dealer could have bought it in his or her market.

Loughmiller later added, “And we experienced this when there was a shortage of vehicles; you get the inventory when you can.”

The boost in online sales also as a trickle-down impact in the sense that when online sales go up, so does the need for transportation, Hallett said, which KAR provides in the form of CarsArrive. It also leads to a greater need for additional financing from AFC.

“Even though our cars financed weren’t up, it was still more active than it would have normally been, I believe,” Hallett said.

Hallett went on to note that the storms tend to have far-reaching impacts into other ancillary services of ADESA, including the key-related services of subsidiary HighTech Locksmiths.

Acquisition strategy

In a quarterly and year-to-date earnings slide deck, KAR includes a year-by-by breakout of its strategic investments.

After two years that included, among other investments, a heavy assortment of brick-and-mortar auction purchases, the 2017 acquisitions have included DRIVIN, Dependable Auto Shippers and the remaining interest in TradeRev.

Does that indicate a shift in the strategy?

No, Hallett says.

“I would tell you that I don’t think the strategy has shifted. I think that we’ve identified some new opportunities,” Hallett said. “I would tell you I don’t believe that brick-and-mortar is done, and there’s probably some brick-and-mortar auctions that we would still be interested in if they become available. And we think there’s a balance there.”

He added: “Brick-and-mortar doesn’t just give you the opportunity to sell cars in the physical environment, but it adds to your buyer base, it adds to you online buyer base, it adds to your ancillary services. It’s that network effect, again; it really allows you to build your business in all your different revenue streams.

“Now, with that said, we also recognize that it’s a world that is focused on data and transformation. And our customers were asking us for better information. They wanted us to be able to take our data, along with their data, and as we’ve talked (about) before, turn that into actionable intelligence or predictive analytics to help them make better buying and selling decisions,” Hallett said.

“And I can tell you that’s not a hard product to sell. The customers are lined up. We’re currently in pilot with several major customers who are using our data and our pricing,” he said. “So that was a real need that the customers had. If you think about it, a customer has data on their own vehicles. We have data on millions of vehicles.”

And again, a big piece of that overall strategy includes TradeRev. As Hallett said during the preceding conference call with the investment community, “Clearly, the industry is going more digital and TradeRev creates a digital wholesale venue. I also see the opportunity to expand their total addressable market by getting a piece of the dealer-to-dealer market that has never used auctions.

“And as you know, TradeRev is a tool that allows franchise dealers to sell more new cars, take more trade-ins with real-time money and bottom line, and allows the dealers to make more money overall. This is just another channel for cars to change hands, and I'm truly excited about the opportunities TradeRev provides for KAR, and it's now time to put the full force of all the resources behind the efforts that are going on at TradeRev.” 


Why Black Book and GM Financial see ‘steady’ and ‘stable’ wholesale market

LAWRENCEVILLE, Ga. and FORT WORTH, Texas - 

Leaders from Black Book and General Motors Financial recently used the adjectives “steady” and “stable” when describing how the wholesale market is behaving.

The latest Black Book Market Insights report indicated used vehicles across most segments are depreciating at a “steady” rate. Editors determined only two vehicle segments — compact vans and sub-compact luxury crossovers — maintained or increased their value.

“Used-vehicle prices and sale conversion rates at the auctions hold firm. Post-hurricane sales activity continues but is slowing down in the Houston region,” said Anil Goyal, Black Book’s senior vice president of automotive valuation and analytics.

GM Financial president and chief executive officer Dan Berce touched on the used-vehicle space when the captive conducted its conference call to discuss its third-quarter performance.

“And a few more comments on the state of the used-car market. Our disposition proceeds on returned leased vehicles compared to estimates at origination in the September 2017 quarter were generally stable both year-over-year and sequentially,” Berce said.

“And based on recent used-car pricing trends that have remained more favorable than previously expected and the temporary impact from Hurricanes Harvey and Irma, we now expect used-car prices to decline less than 7 percent during 2017 compared to 2016, which was our previous guidance. But we do continue to expect the increased supply of used-car vehicles to pressure used vehicles into 2018,” Berce went on to say.

Getting back to Black Book’s latest analysis, editors noticed that based on volume-weighted information, overall car segment values decreased by 0.37 percent last week, similar to the average weekly decrease of 0.41 percent in values they spotted during the previous four weeks.

Black Book pointed out that the sub-compact car and compact car segments were the best performers last week.

Again looking at volume-weighted data, editors noted that overall truck segment values (including pickups, SUVs and vans) softened by 0.21 percent last week, nearly mimicking the similar the average weekly dip of 0.24 percent in values recorded during the previous four weeks.

While minivans declined the most, Black Book mentioned there was renewed demand for compact vans.

Turning next to what Black Book’s representatives shared from the lanes, the rundown began the same as it has since early September with an update on what’s happening in Texas.

“Post-hurricane sales activity continues in the Houston area. Several new buyers from just outside the Houston metro are showing up to purchase inventory at the auctions,” Black Book’s lane watcher in the Lone Star State said.

Where storms also hit, the story is slightly different.

“Older cars seem to be the focus for many dealers in our market. Buyers are being more selective in recent weeks.” Black Book’s representative stationed in Florida said.

Black Book also gathered two other anecdotes from the Southeast.

— From Tennessee: “Nice, clean vehicles with a little age on them continue to thrive. This is especially the situation with the pickup truck market.”

— From Georgia: “A good sale for this time of year, and the prices were consistently solid.”

Two other reports from the lanes originated in locations where the weather already has turned much cooler.

— From Pennsylvania: “Sales conversions and prices continue to hold firm.”

— From Indiana: “Retail remains pretty good here, but prices have slipped a little as has the consignment.”


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