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Midsize and compact cars see weaker price performance

Demand cools for once-hot cars at auctions

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Article Highlights

  1. Midsize cars remain popular in at least one place: the used-car auction. But even there, demand has begun to fade for the segment that dominated the industry for decades.
  2. Midsize cars were the only used-vehicle category in which wholesale prices fell in the second half of 2017 — down 0.7 percent.
  3. Midsize "cars underperformed all year in terms of pricing, and they'll probably continue to struggle because of demand," said Zohaib Rahim, manager of economics and industry insights for Cox Automotive.

Midsize cars remain popular in at least one place: the used-car auction. But even there, demand has begun to fade for the segment that dominated the industry for decades.

Midsize cars were the only used-vehicle category in which wholesale prices fell in the second half of 2017 — down 0.7 percent. Unlike other segments, whose gains ranged from 2.9 to 10 percent in the fourth quarter alone, midsize car prices have been under pressure.

It’s easy to see why: aggressively priced, subvented leases adopted two and three years ago to clear out sedans as consumer preferences shifted to crossovers and SUVs have begun to ripple through the used-car market.

Midsize “cars underperformed all year in terms of pricing, and they’ll probably continue to struggle because of demand,” said Zohaib Rahim, manager of economics and industry insights for Cox Automotive.

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