Used car prices have been holding steady in recent months, barely changing in either May or June, but an increase may be coming.
The wholesale prices car dealers pay at auction for used cars increased in the first half of July. Wholesale price changes become retail price changes after six to eight weeks, so the increase for dealers likely means an increase for shoppers in early fall.
The news comes from Kelley Blue Book parent company Cox Automotive. Cox Automotive also owns Manheim, the operator of America’s largest used car auctions. Its Manheim Used Vehicle Value Index tracks prices paid at auctions.
The increase is due in part to fewer Americans leasing cars than they did pre-pandemic. Fewer cars coming off leases chokes the supply of used cars, raising prices for those that remain.
“More dealers are shopping for wholesale units to satisfy consumer demand for used vehicles right when lease maturities are starting to decline,” explains Jeremy Robb, senior director of Economic and Industry Insights at Cox Automotive.
Used car prices are still down compared to this time last year.
