Used Vehicle Prices Continue to Decline

Overview

According to Cox Automotive, used vehicle prices have dropped for the third consecutive month. In June 2024, prices were down by 8.9% compared to the same month in 2023. Analysts note that the rate of decline has slowed, with prices decreasing by 12% in May.

Market Shift

Gone are the days when used cars were selling for more than new ones. The current trend reflects a decline in used car values, with the Manheim Used Vehicle Value Index falling to 196.1 in June. This indicates a significant drop in values compared to the previous year.

Vehicle Categories

Compact cars experienced the largest decline in value, dropping by 12% in June. Midsize cars followed with an 11% decrease, while luxury cars and SUVs fell by 9.9% and 9.3%, respectively. Trucks fared slightly better but still saw an 8.3% decrease in value.

Market Outlook

Cox Automotive Chief Economist Jonathan Smoke believes that the decline in used vehicle prices may be nearing its floor. This stabilization could lead to market recovery in the coming months, with potential growth by the end of 2024. Despite recent challenges, there is optimism for a rebound in the industry.