Retail used vehicle sales took a step back in March.
According to data compiled by vAuto of Cox Automotive, retail sales closed March down 6 percent year over year. Sales were up 13 percent from February.
Retail inventory is also lagging behind, according to vAuto. March ended with days of supply at 38 days, down from 43 in February and nine days behind March 2022.
The Manheim Used Vehicle Value Index grew by 8.6 percent in the first quarter. It was the fourth straight month for the index to rise “after experiencing the largest decline within one year in the series’ history in 2022,” noted in the Manheim Forecast.
Wholesale used prices increased 1.5 percent in March from the previous month. Manheim reported in six of its eight categories, wholesale prices were up in between 0.5 percent and 2.1 percent from February.
Overall, wholesale prices are down 2.4 percent from March 2022.
“For the first time in a long time, our midmonth Manheim Used Vehicle Value Index reading for the first half of March was actually way more positive than the final value,” said Cox Automotive Chief Economist Jonathan Smoke in the Manheim forecast report. “Based on full-month data and other key metrics, we definitely think conditions are weakening. March came in like a lion and went out like a lamb regarding wholesale vehicle values. After four months of seasonally adjusted gains and 11 straight weeks of price increases, March was a turning point. So, April will likely continue the downward trend we saw as March ended, and we expect to see some negative monthly moves ahead for the index.”
Smoke and other Cox Automotive analysts last month revised used sales forecast for 2023, now showing a slight increase in retail sales, less than 1 percent, instead of a decline. Manheim Used Vehicle Value Index is expected to be up 1.6 percent.
“By historical measures, that is a slightly less-than-normal year but certainly trending toward normalcy,” Smoke said. “Our forecast assumes some negative months this spring and summer, so it will be a bumpy ride. The strong start to the year is a clear testament to what a very supply-constrained market is capable of seeing with just a modest improvement in demand.”
