Mid Week Auto News Update

KELLEY BLUE BOOK ANALYSIS: NEW-VEHICLE TRANSACTION PRICES UP LESS THAN 1% YEAR OVER YEAR, SMALLEST INCREASE IN DECADE

The average price Americans paid for a new vehicle in July 2023 was only $199 higher than one year ago, the smallest year-over-year price increase in the last decade.
 
The average transaction price (ATP) of a new vehicle in July was $48,334, a month-over-month decrease of 0.7% ($337) from June’s ATP of $48,671, according to Kelley Blue Book, a Cox Automotive company. Compared to the start of the year, transaction prices are down 2.7%, or $1,335, the largest January-to-July tumble in the past decade.
 
Read the Data Point for additional details and find out which single model transacted below $20,000 in July.

CONSUMER SENTIMENT FALLS AS GAS PRICES RISE AGAIN

In the Auto Market Report published this morning, Chief Economist Jonathan Smoke explains that the consumer kept the economy on a growth trend through the month of July with robust spending. However, the index of consumer sentiment from Morning Consult fell last week as gas prices rose again. The average price for a gallon of unleaded gas is now down only 3% year over year when it had been down 23% a month ago.

Meanwhile, access to auto credit improved again in July, according to the Dealertrack Credit Availability Index for all types of auto loans. July marked a second month of continuous improvement of credit access across all channels and lender types except captives, which had a slight decrease. However, credit access remains tighter than a year ago and, for many channels, tighter than before the pandemic.

Read the Auto Market Weekly Summary and watch the Auto Market Report video for more data and insights from Smoke on new and used retail sales and inventory, auto financing, and Cox Automotive leading indicators.

NEW-VEHICLE INVENTORY DOWN SLIGHTLY IN JULY, WHILE PRODUCTION AND SALES REMAIN GENERALLY BALANCED

New-vehicle inventory at the end of July was mostly unchanged from the end of June, as production and sales remained generally balanced through the month, according to Cox Automotive’s analysis of vAuto Available Inventory data. Heavier inventories led to richer incentives and robust sales.
 
The total U.S. supply of available unsold new vehicles stood at 1.96 million units at the end of July. Supply was up 71% from a year ago, or more than 800,000 units higher, about the same as the month earlier.
 
Days of supply rose to 56, which was 19 days more than in July 2022. Historically, 60 days’ supply across the industry was considered normal and ideal.

The average listing price – or asking price – remained above $47,000, where it has been since April, ending the month at $47,048. The average listing price was down 0.9% year over year.

Read the July report for additional details, including days’ supply of electric vehicles.

USED SALES DELIVER SUMMER SURPRISE ... AND CPO SALES BEAT EXPECTATIONS IN JULY

According to Cox Automotive estimates based on vehicle registration data, total used-vehicle sales in July increased approximately 2.1% from June to just over 3 million units. The July increase follows a slight increase in June, as used-vehicle sales this summer continue to surprise. Retail sales also increased month over month in July. Total retail used sales through the first seven months of the year are now up 6% compared to the same time frame in 2022.
 
“Used retail supply is considered tight by historic norms,” said Chris Frey, senior manager of Economic and Industry Insights at Cox Automotive. “But used-vehicle sales volume, both total and at the retail level, have been gaining momentum through the summer. Prices have moderated some, which is providing some buying opportunities. Generally, though, with new-vehicle inventory improving and used-vehicle loan rates still sky-high, the used-vehicle market is facing headwinds.”
                                                                    
Further analysis shows that certified pre-owned (CPO) sales in July beat our expectations. Check back in the Newsroom tomorrow for the July report on CPO sales.

WHOLESALE USED-VEHICLE PRICES SEE SMALLER DECLINE IN JULY

Wholesale used-vehicle prices (on a mix, mileage, and seasonally adjusted basis) decreased 1.6% in July from June. The Manheim Used Vehicle Value Index (MUVVI) declined to 211.7, down 11.6% from a year ago.

July’s decrease was softened by the seasonal adjustment. The non-adjusted price change in July decreased by 3.8% compared to June, moving the unadjusted average price down 10.7% year over year.

Check out the Data Point for updates on Manheim Market Report values and major market segments.