October is typically not a strong month for wholesale vehicle vehicles, and this year was no exception. However, conversion rates at the auction were solid last month as dealers were competitively snatching up inventory.
That’s the latest from industry observers who released their respective monthly wholesale price indices this week.
Starting with Cox Automotive, its Manheim Used Vehicle Value Index came in at 202.8 for October, which was 3.2% softer than a year ago and down from 203.0 in September.
Unadjusted, wholesale values were down 3.7% from October 2023 and off 1.9% from September.
“Wholesale values were a bit weaker against what we normally see in October, and trends may have been impacted by business disruptions early in the month caused by hurricanes Helene and Milton coming back to back,” said Jeremy Robb, who is Cox Automotive’s senior director of economic and industry insights. “Seasonally, October is the weakest month of the year for wholesale values; however, in recent weeks, we’ve observed lower depreciation trends in key segments against long-term run rates.”
Meanwhile, over at Black Book, the Used Vehicle Retention Index for October was 147.1, which was up 0.5% month-over-month but down 8.7% year-over-year.
Black Book vice president of data and analytics Laura Wehunt said that, “the overall market reported consistent declines throughout the month that were on par with traditional October depreciation rates. As we move into November, the industry is closely monitoring the presidential election outcome and the possible effects on demand for new and used vehicles.”
October, however, showed strong wholesale demand, at least based on conversion rates.
Cox Automotive pointed out that while the average daily sales conversion rate of 57.4% in October was down 1.8 points from September, it was stronger than usual for this month.
In fact, the average for the last three years for October has been a conversion rate of 52.1%, according to Cox.
“Sales conversion continues to run higher than normal at this time of year, while days’ supply at Manheim is lower than normal, which likely keeps depreciation trends below average,” Robb said.
Wehunt, who is among the 200-plus speakers at this month’s Used Car Week event, noted: “Activity in the auction lanes in October was strong, with conversion rates consistently in the high fifty percent range with the larger independent buyers actively engaging in the bidding and securing a fair amount of inventory.”
