The Manheim Used Vehicle Value Index (MUVVI) fell to 196.1 in June, marking an 8.9% decline from the same month last year.
"Wholesale value declines have been stronger than we normally see for much of the last two months," said Jeremy Robb, senior director of Economic and Industry Insights at Cox Automotive. Despite the declines, the end of June saw a deceleration in price drops, indicating potential stabilization.
Sales conversion rates also showed resilience, running higher than in the past three years, signaling robust buyer demand amidst market uncertainties.
Manheim Market Report (MMR) values showed a decrease, with weekly declines surpassing long-term averages. Over June, the Three-Year-Old Index decreased by 1.5%, with the final week of the month showing a more modest decline of 0.2%. Daily MMR retention averaged 97.8%, reflecting continued market prices below MMR values.
Significant declines were observed across various vehicle segments. Year-over-year, compact cars saw the steepest drop at 12.0%, followed by midsize cars at 11.0%, luxury vehicles at 9.9%, and SUVs at 9.3%. Pickups performed slightly better, down 8.3% compared to June 2023. Month-over-month comparisons revealed that SUVs rose by 0.3%, while pickups dropped by 1.4%.
Electric vehicles experienced notable declines, with seasonally adjusted values down 16.6% year-over-year and 6.5% month-over-month. Non-EVs, in contrast, saw smaller declines of 9.5% and 0.3%, respectively.
The used-vehicle market is also being impacted by a decline in lease returns. Three-year-old vehicles, typically sourced from lease returns, are becoming scarcer, with a forecasted 12% drop in lease maturities for Q3 and an additional 17-18% decline in Q4. This trend is expected to continue into 2026.
Retail used-vehicle sales in June were down 5% compared to May but up 3% year-over-year. The average retail listing price for used vehicles dropped by 1% over the past four weeks. New-vehicle sales also fell, with a 3.4% year-over-year decline and a 7.6% decrease from May.
Rental risk prices at auction decreased by 14.8% year-over-year in June, with a 5.3% drop from May. The average mileage for these units also fell significantly, down 12.8% compared to the previous year.
As the automotive market navigates these shifts, industry experts remain cautiously optimistic. "We think the decline may be nearing its floor, which should help stabilize the market through the summer months and rebound in the back half of the year," said Jonathan Smoke, Cox Automotive chief economist.
While the market faces challenges, the combination of increasing demand, slowing price declines, and slightly better interest rates suggests a potential rebound in the latter part of 2024.
