Although prices are falling, they likely won't decline too much given the tighter inventory compared to 2021.
The month also ended at near 41 days’ vehicle supply, down from 48 days at the end of January and 13 days lower than February 2022 at 54 days' supply.
All eight major vehicle market segments saw seasonally adjusted prices that were lower year over year in January.
The used-vehicle market faces a challenging year ahead as demand weakens and supply of nearly new vehicles is particularly constrained.
After volatile highs and lows during the last three years, the market should hit equilibrium in the second half of 2023.
At the end of November, unsold used vehicles on dealer lots was about 4% higher than a year ago, with an average list price of $27,156.
Days’ supply in October was 26% above year-ago levels. Used-vehicle inventory has been holding at about this level since mid-January.
All eight major market segments saw seasonally adjusted prices that were lower year over year in October.
All eight major market segments saw seasonally adjusted prices that were lower year over year in the first half of October.
Higher interest rates are likely hurting used-vehicle demand because consumers can’t afford the higher monthly payments.
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