Wholesale Values Declining…But Caution Remains a Must

September 21, 2011

There’s been some wholesale pricing relief in recent days as values have dropped across several key vehicle segments.

But I was struck by a couple trends within the broader, largely seasonal dynamic:

  • Black Book notes a high number of downward price adjustments on vehicles in a single day—2,625 individual vehicle price adjustments that ranged as high as $150 per unit.
  • A significant number of “no sales” at auctions, likely due to high mileage vehicles and dealers being circumspect about what they’re willing to pay to acquire units that may not be “sure-fire winners” for their inventories.
  • Dealers continue to note the difficulties they face to find the right vehicles for their inventories.

It’s take-aways like these that continue to underscore the volatility of today’s used vehicle marketplace and why, as I’ve mentioned here before, it’s next to impossible for anyone to keep pace without at least some help from technology to track wholesale and retail pricing trends to avoid costly acquisition mistakes—and find real-deal opportunities, as rare as they may seem.

The upshot: It’s critically important that dealers and used vehicle managers keep a vigilant eye to minimize losses that wholesale price drops create for your current inventory and temper the “let’s buy ‘em now!” tendency that can occur when these prices appear more favorable.

I’ll also add that I’m excited about a new tool under development at vAuto to help dealers and used car managers more efficiently address the challenge of sourcing vehicles. I’ll share more on this when available but, for the moment, I can confidently say this will go a long way toward easing some of the vehicle acquisition pain I hear from dealers every day.