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Mid-Week Auto News Update


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Welcome to From the Newsroom, a roundup of news from Cox Automotive and perspectives from its analysts and experts on topics dominating the automotive industry.

Wholesale used-vehicle pricing increased month over month in May, according to the Manheim Used Vehicle Value Index (MUVVI) reported this morning, and remains nearly 10% higher than a year ago. The MUVVI, a leading indicator of pricing trends in the used-vehicle market, shows that all major market segments saw seasonally adjusted prices that were higher year over year in May, except for pickups. Register to attend the Q2 Manheim Used Vehicle Value Index Call on Friday, July 8, for the latest data and insights.
 
In his Auto Market Report video published this morning, Cox Automotive Chief Economist Jonathan Smoke notes that, unlike the new-vehicle market, the used-vehicle market is seeing slowly improving momentum as supply normalizes and fairly normal depreciation patterns emerge in the wholesale market.
 

Fleet sales remain extremely low with the latest data showing combined sales into large rental, commercial and government fleets dropped 16.1% from May 2021.
 
Gas prices continue to hit new all-time highs, driving car shoppers to consider electric vehicles, hybrids, and smaller, more fuel-efficient gas-powered models, according to a recent Cox Automotive analysis of shopping behavior on its Kelley Blue Book and Autotrader websites.


We hope you find this selection of articles informative and helpful. Visit the Cox Automotive Newsroom for the latest on the industry’s most important topics, and bookmark the Auto Market Snapshot, a one-stop dashboard for the data our team is tracking. Register now for the Cox Automotive Mid-Year Review on Tuesday, June 28.


WHOLESALE USED-VEHICLE PRICES INCREASE IN MAY

Wholesale used-vehicle prices increased 0.7% in May from April. The Manheim Used Vehicle Value Index rose to 222.7, up 9.7% from a year ago. The non-adjusted price change increased 1.1% in May compared to April, leaving the unadjusted average price up 12.1% year over year.
 
All major market segments saw seasonally adjusted prices that were higher year over year in May, except for pickups. Mirroring April’s figures, vans again had the largest year-over-year gains, followed by compact and sports cars. Most of the major segments saw month-over-month seasonally adjusted price increases. Six of the eight major market segments saw price gains from April, with full-size and luxury cars declining.

 
Read the Data Point for additional details on Manheim Market Report values and average daily sales conversion rates. Register to attend the Q2 Manheim Used Vehicle Value Index Call on Friday, July 8. If you can't make the live webinar, be sure to register anyway, and we’ll send you the recording after the event.


BIG WORRY: INFLATION'S IMPACT ON CONSUMER SENTIMENT

In his biweekly video, the Auto Market Report, Chief Economist Jonathan Smoke notes both the Back to Normal Index and the Index of Consumer Sentiment from Morning Consult declined last week, most likely impacted by increasing gas prices.
 
“The big worry is the inflation impact on consumer sentiment, but the labor market fundamentals are so strong that we expect demand to remain fairly stable,” Smoke said.
 
Cox Automotive data show some normalization in the auto market, particularly in used retail supply as well as wholesale supply and depreciation patterns.

 
Read the Auto Market Weekly Summary and watch the Auto Market Report video for more data and insights from Smoke on new and used retail sales and inventory, depreciation patterns and Cox Automotive leading indicators.


FLEET SALES DROP SIGNIFICANTLY YEAR OVER YEAR IN MAY
 
Sales into large fleets, not including sales into dealer and manufacturer fleets, decreased 8.7% month over month in May to 141,047 units, according to an early estimate from Cox Automotive.
 
Combined sales into large rental, commercial, and government fleets decreased 16.1% from May 2021. Sales into government fleets were up 5.9% year over year while commercial fleets were down a fraction at 0.1% year over year. Meanwhile, rental fleet volume remains extremely low, down over 33% from last May.

 
Check out the Data Point published yesterday to see which manufacturers saw the largest gains and losses of sales into fleets. 


SURGING GAS PRICES DRIVE SHOPPING FOR ELECTRIFIED VEHICLES

Gas prices continue to hit new all-time highs, reaching a national average of $4.92 per gallon on June 6, according to the American Automobile Association, and driving more vehicle shoppers to consider EVs, hybrids, and smaller, more fuel-efficient gas-powered models.
 
According to a recent Cox Automotive analysis of shopping behavior on its Kelley Blue Book and Autotrader websites: 

  • Shopping for EVs soared 73% since January before gas prices started their rise. 
  • Shopping for hybrids rose 25% over the same timeframe.
  • Shopping for more fuel-efficient gas-powered models, like small and midsize cars, rose 33% during that period. 

Find out more about how May sales reports issued by some automakers are reflecting the popularity of electrified vehicles.


MAY SALES FINISH BELOW COX AUTOMOTIVE FORECAST

May new-vehicle sales came in lower than the Cox Automotive forecast. Our team was expecting a year-over-year volume decline of roughly 28%; results indicate a drop of more than 29%. Auto sales in May are traditionally quite strong, spurred in part by the long Memorial Day Weekend. But that was not the case this year.
 
Overall new-vehicle buying conditions are a challenge right now for many would-be buyers. Not only are borrowing costs rising with higher interest rates, but higher gas prices are driving up vehicle operating costs as well. According
to research from Kelley Blue Book, more shoppers are looking for smaller, fuel-efficient and electrified vehicles, but finding them on vehicle lots is proving a challenge. Inventory levels for hybrids and compact vehicles remain well below the industry average.
 
See the Cox Automotive commentary for the latest take on May U.S. auto sales.


REGISTER NOW TO ATTEND THE MID-YEAR REVIEW

The Cox Automotive Mid-Year Review will be hosted on Tuesday, June 28, 11 a.m. EDT, shortly before the auto industry closes the book on a first half of highs and lows.
 
During this 90-minute webinar, you will hear how the auto industry performed in the first half of the year and how the Cox Automotive team sees the industry progressing.
 
Our experts and analysts, led by Chief Economist Jonathan Smoke, will review our 2022 first-half forecasts for new- and used-vehicle sales. We will also provide insights and data to help quantify how the consumer, the industry and the economy performed in the first half of the year.

 
Register to attend, and if you can't make the live webinar, we’ll send you the recording after the event.

Looking ahead: Cox Automotive will report May data this week on certified pre-owned sales, Kelley Blue Book average new-vehicle transaction prices and the Dealertrack Credit Availability Index. We will also publish the Monthly Industry Update video.
 
Next week, the Q2 Cox Automotive Dealer Sentiment Index will provide a comprehensive look at how dealers are seeing the current market and the next three months. We will also publish the estimated used-vehicle sales and volume for May, a mid-month look at the MUVVI and the Cox Automotive/Moody’s Analytics Vehicle Affordability Index. Plus, Jonathan Smoke will provide commentary on the Fed’s June 15 meeting.


If you have questions or want to connect with the Cox Automotive PR team in the meantime, feel free to contact us.
AUTO QUOTES

“As we look around the U.S. auto market, we see an industry experiencing a set of simultaneous circumstances that it has never faced before. Our goal is to help automotive industry stakeholders make the best decisions possible to help their businesses thrive. A couple of tools we provide include the Cox Automotive Market Insights & Outlook, a digital yearbook of 2021 data and insights and 2022 forecasts, and the Auto Market Snapshot, a dashboard of the freshest data our team is tracking.” 

– Jonathan Smoke, Cox Automotive chief economist
 
 

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