The average wholesale price of used vehicles fell for the fourth straight month in July. But it was above the average price in July 2005.
Used cars and trucks sold at auction last month for an average price of $9,584, ADESA Analytical Services reports. That was 2.2 percent less than June's average price but 3.2 percent higher than in the year-ago month.
The nation's two largest auto auction companies, Manheim and ADESA Inc., attribute the price erosion to lower retail sales of used vehicles in July.
CNW Marketing Research, of Bandon, Ore., reports that retail used-vehicle sales by franchised dealers were down 21.4 percent last month from the year-ago month.
The decline was 9.5 percent for independent used-car dealers, CNW says.
Manheim chief economist Tom Webb says used-vehicle prices also were affected by dealerships' need to rid themselves of new 2006 inventory before 2007 models arrive.
"Weakness in wholesale pricing in July was virtually inevitable, given the outsized new-vehicle inventories," Webb wrote in an online commentary.
Tom Kontos, ADESA's vice president of industry relations and analytical services, notes that used-vehicle prices in July were up from July 2005. Year-ago prices were depressed by Big 3 incentive programs that offered employee discounts to new-vehicle buyers, Kontos says.
As gasoline prices stayed high, large used SUVs remained the biggest price losers in July. The average wholesale price of big SUVs was $12,429 last month. That was 4.4 percent below the average in June and 9.7 percent below the July 2005 average price.
Manheim's Used Vehicle Value Index was 111.4 in July, down from 112.9 in June but up from 108.8 in July 2005.
The index measures monthly changes in used-vehicle prices. It is adjusted for model, mileage and season.
You may e-mail Arlena Sawyers at [email protected]