Wholesale used-vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) decreased 1.6% from September in the first 15 days of October. The midmonth Manheim Used Vehicle Value Index declined to 211.0, which was down 3.3% from the full month of October 2022. The seasonal adjustment minimized the decrease. The non-adjusted price change in the first half of October dropped 2.2% compared to September, while the unadjusted price was down 5.5% year over year.
Over the last two weeks, Manheim Market Report (MMR) prices declined an aggregate of 1.7%, which was more than the normal decline of 1.3% for the time of year. Over the first 15 days of October, MMR Retention, the average difference in price relative to current MMR, averaged 98.7%, indicating that valuation models are ahead of market prices. The average daily sales conversion rate of 54.0% in the first half of October was above the October 2019 daily average of 52.2%. The conversion rate indicates that the first 15 days of the month saw slightly stronger-than-normal buying demand for this time of year.
Almost all major market segments saw seasonally adjusted prices that were again lower year over year in the first half of October, while pickups gained 0.4%. SUVs lost 2.9%, less than the industry’s year-over-year decline of 3.3%. Compact cars, luxury cars, midsize cars, and vans all declined more than the industry, at 9.3%, 6.3%, 5.9%, and 4.5%, respectively. The major segments all saw negative price performance compared to September with varying results. Compact cars, at 1.4%, and pickups, at 1.1%, lost less than did the industry. Luxury was flat, while vans, SUVs, and midsize cars fared worse, at 2.3%, 1.9%, and 1.8%, respectively, in month-over-month declines.
Wholesale supply slightly higher in mid-October. Leveraging Manheim sales and inventory data, we estimate that wholesale supply ended September at 26 days, up one day from the end of August and down two days year over year. As of Oct. 15, wholesale supply was unchanged from the end of September at 26 days, down two days year over year, and down four days compared to 2019. Wholesale supply was unchanged in early October but is tighter than normal for this time of year.
Rental risk prices decline in first two weeks of October. The average price for rental risk units sold at auction in the first 15 days of October was down 2.2% year over year. Rental risk prices were down by 4.5% compared to the full month of September. Average mileage for rental risk units in the first half of October (at 51,700 miles) was down 8.5% compared to a year ago but up 0.8% month over month.
Consumer sentiment declining further in October. The initial October reading on Consumer Sentiment from the University of Michigan fell by 7.5% to 63.0, as views of both current conditions and future expectations declined. Worries about inflation are clearly driving much of the decline as the median expected inflation rate over the next year jumped to 3.8% from 3.2% last month, and the longer-term view increased to 3.0% from 2.8%. The Fed will not like this move as it suggests consumers are anchoring to higher inflation. Consumers’ views of buying conditions for vehicles declined to the worst level so far this year. The daily index of consumer sentiment from Morning Consult declined less thus far in October, as it is down 0.5% for the month through Oct. 15 compared to the end of September. Inflation, rising interest rates, falling stock prices, and the start of war in Israel are weighing on consumer sentiment. However, gas prices are falling. The average unleaded gas price has declined 5.6% so far in October to $3.60 per gallon as of the 15th.
The complete suite of monthly MUVVI data for October will be released on Nov. 7, 2023, the fifth business day of the month, as regularly scheduled.
For questions or to request data, please email firstname.lastname@example.org. 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.