Used-vehicle retail prices continue rise, but change varies by segment, model

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CARY, N.C. – 

Driven by climbing pre-owned demand and short new-car supply, retail used-vehicle prices in the first half of August had climbed 4.1% month-over-month, according to an iSeeCars.com analysis.

Similarly, J.D. Power’s used retail price index was at 107.2 the week ending Aug. 23, up from 106.8 the prior week and continuing a long pattern of growth.

Used retail prices are up about 7% from where they were before the pandemic, J.D. Power said.

But as iSeeCars shows in its analysis, the shift in used retail prices is not entirely uniform, as some segments and specific models bucked the trend either direction.

For instance, sports cars and luxury cars had stronger-than-average price gains, iSeeCars found. Prices for economy cars and sedans were down in August.

“Dealers don’t need to be as competitive with the pricing of luxury and higher-priced vehicles because shoppers at these price points likely aren’t as bargain-conscious as those looking for more affordable and practical used cars,” iSeeCars chief executive Phong Ly said in an analysis.

“Subcompact cars are the lowest-priced used cars available, so it’s likely that shoppers interested in these vehicles are looking for a deal,” he said.

Breaking the variance down further, iSeeCars shared the 10 used-vehicle models with the greatest price growth (percentage-wise) from July to August as well as the 10 with the largest price drops.

The iSeeCars study included more than 500,000 sales of 2015 to 2019 model-year vehicles between July 1-17, and then more than 400,000 of that same age group from Aug. 1-17.

As illustrated in the charts below, topping the list of highest price increases was the Dodge Challenger, whose used-vehicle prices were up 9% from July to August.

Aside from the Ford Mustang (up 7.2%) at No. 9, luxury models filled the rest of the list.

“The Ford Mustang and the Dodge Challenger are the best-selling sports cars in the United States, and used-car shoppers are willing to pay a premium for these in-demand vehicles,” said Ly.

As for the luxury vehicles on the list, he added: “Consumers are likely drawn to the prestige of these vehicles and may be less price sensitive even though Land Rovers are notorious for below-average reliability scores and high ownership costs, and BMWs and Volvos have above average ownership costs as well.”

Conversely, the list of vehicles with the biggest price declines is led by the Chevrolet Sonic, whose prices were down 2.3% month-over-month. The rest of the list includes a variety of segments, but overall, midsize sedans claim four of the 10 spots, the iSeeCars data shows.

“The declining popularity of the segment and the emergence of more affordable small SUVs have lessened the demand for these sedans, so dealers are more likely to provide discounts,” said Ly.

The iSeeCars charts on the 10 used vehicles with biggest price gains and biggest price drops can be found below.

Used Vehicles With the Greatest Price Increases – iSeeCars Study
Rank Used Vehicle Average Used Car Price (August 2020) $ Price Difference from July to August % Price Difference from July to August 
1 Dodge Challenger $32,163 $2,667 9.0%
2 Land Rover Range Rover Sport $51,502 $4,226 8.9%
3 Volvo S60 $23,105 $1,829 8.6%
4 Lexus RX 350 $35,055 $2,707 8.4%
5 Land Rover Discovery Sport $28,839 $2,121 7.9%
6 BMW 4 Series $28,064 $2,050 7.9%
7 BMW 7 Series $45,213 $3,209 7.6%
8 Volvo XC60 $29,011 $2,042 7.6%
9 Ford Mustang $28,715 $1,940 7.2%
10 Land Rover Range Rover Evoque $29,866 $1,961 7.0%
Average $23,705 $941 4.1%

 

Used Vehicles With the Greatest Price Decreases – iSeeCars Study
Rank Used Vehicle Average Used Car Price (August 2020) $ Price Difference from July to August  % Price Difference from July to August 
1 Chevrolet Sonic $10,463 -$243 -2.3%
2 GMC Yukon XL $42,317 -$811 -1.9%
3 Chevrolet Spark $9,839 -$185 -1.8%
4 Ford Fusion Energi $16,844 -$313 -1.8%
5 Ford Ecosport $17,409 -$199 -1.1%
6 Mazda Mazda6 $16,704 -$188 -1.1%
7 Porsche 911 $132,704 -$1,453 -1.1%
8 Hyundai Elantra GT $13,906 -$150 -1.1%
9 Lincoln MKZ $22,513 -$241 -1.1%
10 Nissan Altima $15,339 -$124 -0.8%
Average $23,705 $941 4.1%



Source : AutoFinanceNews