The Manheim Used Vehicle Value Index fell for the fourth-consecutive month and may slide further to the lowest in a year, the consultant’s economist said.
Manheim, whose index is determined through more than 5 million annual U.S. sales, said the measure dropped to 122.9 in September. After reaching a record high in May, wholesale prices dropped 2.5 percent during the third quarter, the most since 2008’s fourth quarter, the Marshall, Virginia-based company said.
“I fully expect that the Manheim index will show further easing in the near term,” Tom Webb, Manheim’s chief economist, said today on a conference call with analysts and reporters. “I wouldn’t be surprised if the overall Manheim index tests the 120 level. I would be surprised if it tests the 115 level.”
The Japan tsunami in March that disrupted production led to shortages of new vehicles and combined with higher gasoline prices in contributing to a “sharp run-up” in used-vehicle prices, especially compact cars, Webb said. Wholesale vehicle prices are still 3.4 percent higher than a year earlier, Manheim says.
Manheim’s index reached 127.8 in May, the highest in its 16-year history.
“What we have seen since May of this year is a clearing out of some excesses,” Webb said on the conference call.
The Manheim index has exceeded 120 since October 2010 and has stayed above 115 since July 2009.