According to the latest data from Cox Automotive, used-vehicle values showed signs of stabilization in 2024, ending the year on a positive note. The Manheim Used Vehicle Value Index (MUVVI) closed out 2024 at 204.8, marking a 0.4% increase compared to the previous year. While this gain is below the long-term average growth rate of 2.3%, it represents the first year-over-year increase since 2021.
Cox Automotive’s Chief Economist, Jonathan Smoke, noted the market’s volatility throughout 2024, with lower-than-expected prices in the first half of the year and stronger performance in the second half. This shift was largely driven by healthy retail demand and tight inventories. Smoke highlighted that mid-2024 marked a turning point, signaling the end of the “corrections” that had been driving down used-vehicle prices, leading to market stabilization.
In December, used-vehicle values saw a slight decline, with wholesale prices decreasing more than expected toward the month’s end. However, consumer demand remained robust, with retail used-vehicle sales for 2024 rising by 4%. December alone saw a 13% year-over-year increase in sales.
Jeremy Robb, Senior Director of Economic and Industry Insights at Cox Automotive, pointed out that while wholesale values dropped more than usual in December, 2024 overall was the most normal year for depreciation trends in the past five years. The year ended closer to longer-term patterns, signaling a return to stability.
The used electric vehicle (EV) market experienced continued growth in 2024 but also saw significant depreciation. The EV value index fell by 28% since its peak in July 2022, while the non-EV index declined by a lesser 14%. Despite the ongoing depreciation, the market showed signs of recovery. The second half of 2024 saw a 9.4% increase in the EV index, outpacing the 4% growth of non-EVs.
Looking ahead to 2025, analysts forecast retail used-vehicle sales will reach 20.1 million, representing a modest 1.2% increase from 2024. However, retail and wholesale sales growth will remain constrained due to ongoing inventory challenges, including tight supply and fewer lease returns.
As for depreciation trends, Cox Automotive expects them to stabilize in 2025, with values following more typical patterns after the market’s roller-coaster performance in recent years.
