It has been there to see for nearly 8 months... the incredible strength in used car prices at the auction block. Right there along with that has been, "...when is this madness going to stop". Yesterday [SOUTHERN AA CT] we saw a decline in prices, but the more indicative trend is the decrease in %'s sold.
As the conversion rate decreases (sellers not hitting reserve or floor prices) and %'s sold decrease, buyers feel a nervousness and change bidding habits. You watch others abruptly stop at $13,900 and not chase a car into the 14's. You watch the post gavel negotiation between buyer/seller/auctioneer in a fruitless attempt to have that vehicle escalate another $1000. Then there are the duplicates that I so often refer to such as Altima, Sonata, Accord, Escape etc. Combine a nervousness with the awareness that you already have 6 of those in inventory and this decline we see now was in fact quit predictable.
If you are struggling at auction, feel free to contact Sudden Services LLC.
If prices are measured by book value on average, than you could say the market is about average . If you single out trucks, it quickly becomes a soft market. If you gauge small cars... try to guess what a Focus or Elantra will do! It may be mid-summer, and it has been hot... but not as hot as cars at auction! The auction business itself, as a whole, is in a rapid state of change and that has had more effect on prices than we give credit to. The shortage of cars crossing the blocks are still out there, but are selling through different channels . Finance companies sell direct. Rental companies have mature wholesale channels outside the auctions. OVE, AutoTrader, Cars.com... all outside channels that have syphoned vehicles out of auction lanes as well. I believe that these are major reasons as to why the "remaining" cars at auction have jumped to the levels they have. It has been the push away from the physical auction from the major consignments sources that has increased val...
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