Pickups See Record Drop in Used Prices
Apr 8, 2008 12:38 PM
Used-pickup prices plunged 9% in March's Manheim Used Vehicle Value Index reading - the largest year-over-year decline on record,
Full-size light and heavy-duties led the charge, down 13% and 14%, respectively.
“We think this threatens the important upcoming Dodge Ram and Ford F-150 launches in two ways: 1) consumers will be less able to use their current used vehicle as currency to lower their monthly payments on a new purchase; and 2) the new vehicles will be less price competitive on the market compared to used,” Bear Stearns said.
The Manheim Index measures values using statistical analysis of more than five million used-vehicle transactions annually to capture used-vehicle pricing trends independent of underlying shifts in characteristics such as mileage and content. The Index is calculated by Manheim Consulting, the analytical arm of Manheim Auctions, a leading global provider of wholesale automobile auctions.
It’s relevant to new sales because: it can serve as an indicator of the overall health of the vehicle market; used-vehicle pricing impacts estimated resale values for new cars and therefore weighs on the new-car purchase decision; and changes to individual vehicle segments within the index can highlight changing consumer preferences.
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