Used-vehicle inventory climbed during January to more normal levels on weaker sales, according to the Cox Automotive analysis of vAuto Available Inventory data released Feb. 17. The average list price dipped from record levels in December.

The total supply of unsold used vehicles on dealer lots across the U.S. climbed to 2.55 million units at the end of January, compared with Cox Automotive’s revised number of 2.38 million at the end of December. The supply at the end of January was about 1% above a year ago.

At the end of January, the days’ supply of unsold used vehicles was 56, up from the revised number of 51 at the end of December. Days’ supply began dropping last January, bottoming out at 30 in April and inching its way higher ever since. The days’ supply at the end of January was 26% above the level of the previous year.

The Cox Automotive days’ supply is based on the daily sales rate for the most recent 30-day period. Used-vehicle sales in January were down 1% from January 2021 and January 2020. The January used seasonally adjusted annual rate (SAAR) was 39 million, down from 39.3 million in January 2021 and up from 36.2 million in December.

“Used vehicles are starting to see some inventory build-up ahead of the prime selling season as tax refunds come in,” said Charlie Chesbrough, Cox Automotive senior economist in a news release. “The inventory volume and days’ supply are both above last year, though sales remain low. Spring should see strong demand.”

However, high prices could mute sales, he added.. The average used-vehicle price is still high although it is down from recent peaks and should fall slightly in the coming weeks as it normally does after the holidays.

At the end of January, the average listing price had fallen below peak levels to $27,633 when it had been above $28,000, according to Cox Automotive data. Still, the average listing price was 29% above the end of January 2021.

On the wholesale side, the Manheim Market Report (MMR) values saw weekly price decreases in January that accelerated slightly in the final full week of the month. However, price patterns in the month varied by vehicle age and segment. Older vehicles saw price stability while newer vehicles leaned toward larger declines.

The lowest price segments – under $15,000 – had the lowest inventory and lowest days’ supply at under 40. Price segments from $25,000 and up had the biggest supply in both volume and days’ supply – between 61- and 69-days’ supply. In between segments had between 49- and 57-days’ supply.