Northeast Used-Car Supply Tightens; Only 30 Percent Trades In November

New car sales were strong throughout November, with 1.14 million total sales, an increase of fifteen percent and a handful of car makers posting record months. This pace of new-car sales activity, combined with the continued replacement of inventory from Hurricane Sandy vehicles, will impact used cars in a few different ways, according to Ricky Beggs, Managing Editor of Black Book:

The jump in new-car sales, with some industry estimates pushing SAAR to 15.6 million, means additional trades entering the lots. This increased inventory will continue to ease supply of used cars and offset prices from the Northeast demand.
However, while sixty percent of all new sales include a trade, on average, this trade-in number is expected to be much lower throughout the Northeast, according to Black Book estimates. Trade-in activity could fall as low as thirty percent of new sales throughout the Northeast.
This falling percentage means prices on used cars throughout the Northeast may see continued near-term increase in prices, as dealers see less inventory from trades and look elsewhere to find used-car inventory.

In terms of used-car pricing trends, Black Book analysts recorded notable price changes this past week on several used car and truck segments. Compact cars and sporty cars saw the least price declines, while premium luxury cars and entry-level cars had the biggest price declines.

Compact Cars: -0.25 percent
Sporty Cars: -0.34 percent
Luxury Level Cars: -0.36 percent
Premium Luxury Cars: -0.67 percent
Entry Level Cars: -0.77 percent

For trucks, weekly price increases were recorded for compact SUVs, midsize cargo vans, and compact crossovers. However, midsize van wagons, midsize crossovers, and full-size van wagons all led the largest price declines for trucks.

Compact SUV: +0.06 percent
Midsize Van Cargo: +0.05 percent
Compact Crossovers: +0.02 percent
Midsize Van Wagon: -0.43 percent
Midsize Crossover: -0.51 percent
Fullsize Van Cargo: -0.77 percent