Wholesale used car prices drop ahead of Fed rate decision

Wholesale used vehicle prices declined in the first half of September, moving against typical trends for this time of year.

Driving the news: Average auction prices typically rise in September, but values seem to be moving against historical trends, according to Cox Automotive.

• Wholesale used vehicle prices, on a seasonally adjusted basis, declined 0.2% from August in the first two weeks of the month.

• This represents a shift from last month, when auction values rose 1.2% over July. On an annual basis, wholesale prices are down about 5%.

Zooming in: Other notable trends in used car auctions are emerging for this time of year, reflecting a shift in the preowned market.

• But the first two weeks of September saw a decline in the daily sales conversion rate, suggesting that dealers are not racing to auction which is considered normal for the season.

• Bigger models are still seeing faster price declines than other cars as buyers continue to prioritize affordability. Compared to the average year-over-year drop of 5%, SUV prices fell 5.2%, midsize vehicles fell 5.7%, and pickups fell 7.5%.

Bottom line: The wholesale market continues to reflect broader themes in the preowned segment. But while dealers should take note of the emerging trends for this time of year, caution is warranted considering the Federal Reserve’s rate cut decision is due later today. Should rates come down as expected, this could fuel a drastic shift in consumer demand, making the latter half of the month look very different from the former.

Become an automotive insider in just 5 minutes.

Get the weekly email that delivers transparent insights into the car market.

Join 78,000 others now, it's free:

Dealerships that sell vehicles across state lines know out-of-state titling and registration can be a headache. That’s why DLRdmv created DLR50 – The nation’s fastest-growing interstate titling platform.

DLRdmv understands the impact these deals can have on your business. With DLR50, your dealership now has 24/7 portal access to calculations, pre-filled forms, checklists, inquiries, plus white glove processing and specialist support, DLR50 is a game-changer.

You can even acquire duplicate titles in all 50 states directly through the DLR50 platform!

Out-of-state deals don’t have to be complicated! Let DLR50 simplify the entire process for you and your team.

Click Here to show us how DLR50 can help your dealership today!

DLRdmv – “The Dealer’s DMV”