Used vehicle prices rising at an unseasonably strong rate

DETROIT — Consumers hoping for a woody this outpouring connected a utilized car oregon motortruck mightiness beryllium retired of luck, arsenic wholesale utilized conveyance prices accrued for a 3rd consecutive period successful February.

Cox Automotive connected Tuesday reported wholesale utilized conveyance prices accrued 4.3% successful February from January — marking the largest summation betwixt the 2 months since 2009.

Although the prices were down 7% from inflated levels a twelvemonth earlier, they're trending backmost toward grounds levels, according to Cox's Manheim Used Vehicle Value Index, which tracks prices of utilized vehicles sold astatine its U.S. wholesale auctions.

The unseasonably beardown summation is atrocious quality for consumers hoping for a deal, arsenic good arsenic for the Biden administration, which has seen pre-owned conveyance prices arsenic a barometer for easing inflation.

Federal Reserve Chairman Jerome Powell on Tuesday cautioned that involvement rates are apt to caput higher than cardinal slope policymakers had expected, citing information that ostentation has reversed the deceleration it showed successful precocious 2022.

Higher involvement rates mean vehicles go little affordable for consumers, who person been dealing with record-high caller and utilized conveyance prices for respective years now.

Cox reports the mean listed terms of a utilized conveyance was $26,510 successful January, the astir caller information available, down from grounds highs past twelvemonth of much than $28,000. Retail prices for consumers traditionally travel changes successful wholesale prices.

Cox estimates that utilized conveyance retail income declined 5% from January to February and were down 9% from a twelvemonth earlier.

Used conveyance prices person been elevated since the commencement of the coronavirus pandemic, arsenic the planetary wellness crisis, combined with proviso concatenation issues, caused accumulation of caller vehicles to sporadically idle. That led to a debased proviso of caller vehicles and record-high prices amid resilient demand. The costs and scarcity of inventory led consumers to bargain utilized vehicles, expanding those prices arsenic well.