Used-car prices across the US fell again in November, as a sluggish economy and rising inventories continue to put pressure on rental companies and automotive retailers.
(Bloomberg) — Used-car prices across the US fell again in November, as a sluggish economy and rising inventories continue to put pressure on rental companies and automotive retailers.
The widely watched Manheim Used Vehicle Value Index last month was down 14.2% from a year ago, while unadjusted used-car prices tumbled 12.4% in that span, the automotive auctioneer said Wednesday.
The index fell to the lowest level since August 2021 as used-car sales declined 10% in November.
Used-car prices have been plunging as the Federal Reserve has raised interest rates to slow the highest inflation in 40 years.
Earlier in the pandemic, new- and used-car prices soared amid semiconductor shortages and other supply-chain bottlenecks. But as those broke, inventories began to rise, especially on used-car lots, sending prices and profits sharply lower at rental companies and car dealers, including CarMax Inc and Carvana Co.
Read more: CarMax Woes Flash Warning Signs for Auto Market
Carvana’s stock fell as much as 47% Wednesday after Bloomberg reported its creditors had banded together to work with the company on a debt restructuring.
CarMax fell 1.7% at 2:18 p.m.
Manheim, a unit of Cox Automotive, said used sport-utility vehicle prices fell 16.4% in November from a year earlier, the largest decline of any automotive segment.
Used luxury car prices were down 15.6%, midsize cars were off 14.4% and pickup trucks dropped 11.9%.
Manheim’s index is drawn from more than 5 million used-vehicle transactions annually. It adjusts for vehicle mileage, seasonal factors and vehicle market segments, based on a 24-month rolling average of past sales.
The index is seen as a bellwether by financial and economic analysts.
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