Add auctioneers to the list of professionals from throughout the automotive industry having to put in more effort to overcome challenges created by the coronavirus pandemic.
In the latest installment of COVID-19 Market Insights released by Black Book on Tuesday, analysts described what’s happening in the lanes nowadays as dealers continue to keep a close watch on their inventory and floorplan.
“For the past two weeks, auctioneers have been finding themselves having to work harder to get the bids up,” Black Book said.
“This past week, more bids were resulting in ifs and no-sales as buyers showed hesitancy in stepping up an additional $300 to $400 to meet the sellers’ floors,” analysts continued in the latest report.
That reluctance and awareness about sellers’ floors arrived as Black Book noticed that its volume-weighted information showed overall car segment values increased just 0.04% this past week, representing the lowest week-over-week value increase since the third week of May.
Analysts explained that sub-compacts, compacts and sporty cars each sustained value decreases ranging from 0.13% to 0.36% because of softening retail demand.
Conversely, Black Book noticed the luxury segments are demonstrating value stability, especially premium sports cars that gained 0.55% week-over-week.
Over on the truck side, analysts indicated their volume-weighted information showed overall truck segment values (including pickups, SUVs and vans) rose by 0.41% last week.
Black Book pointed out the upward value march for full-size trucks continued into the 14th week in a row.
“New-inventory deliveries are starting to increase after months of struggles to get production back going, so it is expected that this rate of increase will begin to slow,” analysts said.
And speaking of those new models, their arrival at franchised dealerships is also prompting managers to be “more selective in the used units they are sourcing at auction and the trade-ins they are keeping,” according to Black Book.
Analysts then added, “This past week, dealers backed off in their purchasing with the reason being that they want to wait to see how consumer demand shapes up over the Labor Day weekend.”
Black Book touched on one other ongoing difficulty that’s intensified since March and how the industry is trying to use technology to solve the issue.
“With transportation continuing to present a challenge for buyers and sellers due to the time and cost required to move vehicles, some sellers are making use of the virtual sales by listing their vehicles for sale but vehicle pickup is at their dealership or another holding location,” analysts said.
“This is beneficial to sellers because it is allowing them to get their units offered for sale sooner,” they went on to say.
Source : AutoFinanceNews
