Analysts at J.D. Power Valuation Services noted that the used vehicle market continued its sluggish start to the new year in its latest Used Car and Light Truck Guidelines Industry Update.
The J.D. Power Valuation Services Seasonally Adjusted Used Vehicle Price Index declined 1.3 points — relative to January — to 116.1. February’s decline marked the sixth consecutive month of declines in the used market and is a trend that is expected to see more throughout 2019 as used vehicle prices are expected to decline relative to 2018.
In non-index terms, wholesale prices of used vehicles up to eight years in age fell by 1.5% in February relative to January. February’s performance was the month’s worst result in the past 20 years and only the second time there has been a material decline in prices during that time. The other time prices fell in February was back in 2017.
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As for the full-year 2019 expectations, the used market is expected to slow. With January and February’s weaker-than-expected performances, 2019’s outlook has worsened. As a result, prices are forecast to fall by around 3%. Increasing levels of used supply, along with more volatile credit conditions and increasing gasoline prices, are expected to apply downward pressure on the used side of the market.
David Paris, an executive analyst at J.D. Power Valuation Services, commented:
With January and February’s weaker than expected performances, 2019’s outlook has worsened. As a result, prices are forecast to fall by around 3%. Increasing levels of used supply along with more volatile credit conditions and increasing gasoline prices which are expected to apply downward pressure on the used side of the market.
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