NADA: Prices for Full-Size Pickup Trucks Up 7%
MCLEAN, VA--May 13, 2013: -- Auction prices for full-size pickup trucks are up nearly 7 percent through the first four months of 2013, says the NADA Used Car Guide in its May edition of Guidelines .
"The recovery of home values and increased residential construction, stabilizing gasoline prices and a decline in late-model supply have resulted in higher trade-in values for full-size pickups," said Jonathan Banks, executive automotive analyst with the NADA Used Car Guide.
For example, the average trade-in value for a 3-year-old Chevrolet Silverado 1500 Crew Cab LT 5.3L 2WD is $20,540, up $1,460 or 8 percent, according to the May 2013 edition of the NADA Used Car Guide. Last year, the value of a 3-year-old Silverado was $19,080. The same trend can be seen across all brands of full-size pickups.
Click here for the chart:
NADA Used Car Guide May 2013
A key factor contributing to the higher values for used, full-size pickups, which have increased in price 28 percent from 2007 to 2012, is the basic rule of supply and demand.
"The late-model, used supply of full-size pickups has yet to recover from the dramatic fall off in new-vehicle sales caused by the economic recession," Banks added.
The supply of full-size pickups up to 8-years-old declined by 17 percent from 2007 to 2012, and will fall by an additional 8 percent on an annual basis in 2013, NADA predicts.
"The continued slide in supply comes at a time when demand is heating up and the housing market improves," Banks said.
New housing starts totaled 781,000 in 2012, and the National Association of Home Builders estimates that housing starts will jump to at least 1 million units in 2013.
Home prices are also on the rise, up 8.7 percent over the first two months of 2013 compared to the same period a year ago, according to the S&P/Case-Shiller 20-City Composite Home Price Index. Forecasters from Zillow, Inc., a real estate information site, expect home prices to rise by another 5.4 percent this year.
"The increase in home prices will continue to stoke demand for full-size pickups, particularly those in configurations most frequently used in construction applications, such as lower-priced 2-wheel drive, regular cab trucks with V-6 engines," Banks added.
In its May edition of Guidelines , NADA reports that wholesale prices for all segments of used vehicles up to 8-years-old dropped by 1.7 percent in April. Compact and mid-size cars led the decline with prices falling by a combined average of 2.1 percent. Used prices for full-size pickups slipped by a modest 0.5 percent in April.
"The low rate of depreciation for full-size pickups means that consumers will find themselves in a favorable equity position if they trade-in their used pickups for a new or newer pre-owned one," Banks said. "There is little evidence to suggest that consumer demand for full-size pickups will diminish in the near-term. We expect prices in the segment to remain above average for the remainder of the year."