Black Book Creates Vehicle Retention Index
Black Book will begin offering the monthly Used Vehicle Retention Index to measure the strength of used wholesale market values, the company has announced.
The index will offer a value based on a calculation that incorporates the wholesale values of two- to six-year-old vehicles sold at auction in average condition. The index is weighted based on used vehicle registration volume and adjusted for seasonality, vehicle age, mileage, condition, segment mix, and inflation.
The index aggregates daily vehicle value updates captures through hundreds of physical and online auto auctions across the country with a comprehensive list of vehicles, according to Black Book.
The index uses January of 2005 as its benchmark index value of 100. In March, the index scored 115.9, which indicates a 16% increase in used value retention strength. When applying the index retroactivaly, the index fell steadily since October of 2015, when it reached a high point of 127.
During the recessionary period, the Index experienced a sharp drop of about 14% from January 2008 to January 2009. In 2010, the Index recovered nicely and gained 10% during the year. After the recession, the Index continued to rise persistently until 20111 and remained high till 2015. The Index lost 6% in 2016. The Index is expected to continue its slow decline in 2017 as the used vehicle market loses strength, according to Black Book.