Used vehicle depreciation worsens as Mid-Size Cars and ...

November 18, 2018

"Used vehicle depreciation worsens as Mid-Size Cars and Compact Crossover/SUVs see the largest weekly drop this year."

Anil Goyal, Executive Vice President, Operations

WEEKLY CHANGE

0% -0.2% -0.4% -0.6% -0.8% -1.0% -1.2%

-$45 -0.76%

-$62 -0.80%

-$91 -1.05%

-$11 -0.10%

-$100 -0.65%

-$63 -0.34%

-$54 -0.16%

-$108 -0.72%

-$217 -0.57%

-$74 CARS -0.69%

WEEKLY CHANGE

0% -0.2% -0.4% -0.6% -0.8% -1.0% -1.2%

-$30 -0.24%

-$96 -0.79%

-$99 -0.65%

-$79 -0.36%

-$40 -0.23%

-$58 -0.31%

-$42 -0.21%

-$189 -0.61%

-$110 -0.87%

-$84 -0.96%

-$29 -0.20%

-$45 -0.29%

-$76 -0.39%

-$85 TRUCKS -0.53%

Model Years: 2010-2016, Volume Weighted Wholesale Average Values, Weekly Change from 11/9/18 to 11/16/18

Cars and Light Truck Depreciation Increases

? Volume-weighted, overall car segment values decreased by 0.69% last week. In comparison, the market values had decreased by 0.56% on average during the prior 4-week period.

? In cars, the Mid-Size Car segment experienced the biggest drop.

? Volume-weighted, overall truck segment (including pickups, SUVs and vans) values decreased by 0.53% last week. In comparison, the market values had decreased by 0.45% on average during the prior 4-week period.

? In trucks, the Compact Van segment performed the worst.

November 18, 2018

Sentiment from the Auction Lanes

Our editors and personnel attend several auctions every week across the country to provide key insights:

"The sale could best be described as sluggish. Lower mileage older cars were the most popular vehicles." Frank in AZ

"We had a pretty decent sale but definitely more no sales compared to previous weeks." Ben in CA

"The dealers knew what type of vehicle they were looking for and were only bidding on those. Not a lot of speculating going on." Mark in MI

"Attendance and inventory were pretty low. There was not a lot of enthusiasm amongst the dealers." Israel in GA

"We have a small auction without a lot of the commercial accounts and our sales percentages have been consistently about 65%. Our inventory is very popular but especially so right now." Auction GM in SC

Black Book Retention Index Mid-Size Car Segment

135 130 125 120 115 110 105 100

95 90 85

Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Jul-13 Jan-14 Jul-14 Jan-15 Jul-15 Jan-16 Jul-16 Jan-17 Jul-17 Jan-18 Jul-18

source: Black Book Visual Analytics

Interestingly, mid-size sedans have fallen out of favor in new vehicle sales but this segment has been one of the strongest in used vehicle values this year after being beaten down for several years. Affordability and great deals on used mid-size cars were key in driving this trend.

Vehicle Highlight

2019 Lexus LS 500 is equipped with a 3.5L Twin-Turbo V6 producing 416 hp and 442 lb-ft of torque, mated to a 10-speed automatic transmission available in both RWD and AWD configurations. The performance F Sport variant offers signature front fascia, sport seats and advanced vehicle dynamic control system. MSRP with destination ranges from $76,225 (Base RWD) to $85,445 (F Sport AWD) and the key competitors include the BMW 7-series, Genesis G90, Cadillac CT6 and Audi A8.

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