Wholesale Used-Vehicle Prices Decrease in the First Half of February

Wholesale used-vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) dropped from January in the first 15 days of February. The mid-month Manheim Used Vehicle Value Index fell to 203.3, now showing a decline of 0.2% from the full month of February 2024. The seasonal adjustment countered the February non-adjusted price increase. The non-adjusted price change in the first half of February rose 1.0% compared to January, and the unadjusted price is up 0.4% year over year. The average move for the month of February is an increase of nearly a full percentage point on non-adjusted values, indicating the appreciation observed thus far is lower than normal and the reason for the negative seasonal adjustment.

Over the last two weeks, the Manheim Market Report (MMR) prices in the Three-Year-Old Index increased by an aggregate of 0.1%, which is weaker than increases we have seen over the same weeks in recent years. Over the first 15 days of February, MMR Retention, the average difference in price relative to current MMR, averaged 100.1%, indicating that valuation models have moved closer to market prices early in February. MMR retention is three-tenths of a point higher compared to the first half of February 2024. The average daily sales conversion rate of 59.8% in the first half of the month was almost 2 points higher than last year’s level of 57.9%, and it is above the first half of February 2019 by more than 6 points. While early February conversion is above the comparison of early 2019, it’s below 2021 and 2023 levels.

Major market segments saw mixed results for seasonally adjusted prices year over year in the first half of February. Compared to the industry’s year-over-year decrease of 0.2%, luxury performed best, rising by 0.4%. The 0.2% decline in SUVs was in line with the industry. All other segments were lower year over year, as pickup trucks declined 1.0%, mid-size cars were down 3.1%, and compact cars were down 4.7% over the period. All segments were down compared with the results at the end of January. The overall industry decreased 1.1% against the prior month, while pickup trucks and midsize cars performed better than the overall industry, decreasing by 0.3% and 0.7%, respectively. SUVs performed the same as the overall industry, declining 1.1%. Showing more depreciation than the industry overall, luxury declined 1.3%, and compact cars fell 1.5% against the prior month.

Electric vehicles (EVs) continue to exhibit the highest depreciation levels. EVs were down 6.4% against February 2024, while the non-EV segment was down by 0.9%. Against January values, EVs decreased by 0.4% in the first half of February, while non-EVs were down by 0.9% in the month.

Wholesale Supply is Up in Mid-February

Leveraging Manheim sales and inventory data, wholesale supply ended January at an estimated 27 days, down four days from the end of December and flat compared to January 2024, also at 27 days. Wholesale supply continues to hold tighter at this time of year, running six days lower than the longer-term levels for this week. As of Feb. 15, wholesale supply was unchanged from the end of January, at 27 days, and was flat versus last year.

Measures of Consumer Sentiment Show Continued Weakness in February

The initial February reading on Consumer Sentiment from the University of Michigan declined 4.6% to 67.8, which was weaker than expected and left the index down 11.8% year over year. Views of current conditions and expectations declined, with current conditions declining the most. Expectations for inflation in one year jumped to 4.3% from 3.3%, and expectations for inflation in five years increased slightly to 3.3% from 3.2%. Consumers’ views of buying conditions for vehicles declined slightly as views of prices deteriorated, but views of interest rates improved. The daily index of consumer sentiment from Morning Consult has declined 0.7% in February through Feb. 17. It declined 0.1% in January, ending a six-month upward trend. The daily index in mid-February was up 9.1% year over year. According to AAA, the average price of unleaded gasoline increased by 1.3% to $3.16 per gallon in January and is up 1.9% as of Feb. 16. Gas prices are down 4% year over year.

The next complete suite of monthly MUVVI data will be released on March 7, 2025.

For questions or to request data, please email manheim.data@coxautoinc.com. If you want updates about the Manheim Used Vehicle Value Index, as well as direct invitations to the quarterly call sent to you, please sign up for our Cox Automotive newsletter and select Manheim Used Vehicle Value Index quarterly calls.

Note: The Manheim Used Vehicle Value Index was adjusted to improve accuracy and consistency across the data set as of the January 2023 data release. The starting point for the MUVVI was adjusted from January 1995 to January 1997. The index was then recalculated with January 1997 = 100, whereas prior reports had 1995 as the baseline of 100. All monthly and yearly percent changes since January 2015 are identical. Learn more about the decision to rebase the index.