Wholesale used-vehicle prices fall slightly in early July

Wholesale used-vehicle prices declined 0.7% in the first half of July on a seasonally adjusted basis, according to Cox Automotive’s mid-month Manheim Used Vehicle Value Index (MUVVI), which now stands at 206.9—a 2.6% increase year-over-year. On an unadjusted basis, prices dropped 1.6% month-over-month, though they remain 2.8% higher than the same period last year. Despite tighter wholesale supply and steady retail demand, pricing trends are beginning to moderate compared to the stronger-than-usual market seen in Q3 of 2024.

Here’s why it matters:

This early July pricing shift signals a return to more traditional seasonal depreciation patterns following last year’s unusually strong Q3. Dealers should anticipate slower year-over-year gains as retail values begin to normalize. However, the used market remains in relatively stable condition, supported by tight wholesale supply and consistent sales conversion rates. This creates an environment where disciplined inventory management and segment-focused acquisition strategies could help maintain margins despite mild softening in demand.

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Key takeaways:

• Early July wholesale used-vehicle prices declined slightly
  Seasonally adjusted prices fell 0.7% from June. On an unadjusted basis, prices dropped 1.6% month-over-month but are still up 2.8% year-over-year.
• Luxury and EVs show strongest annual gains
  Luxury vehicles posted a 5.6% year-over-year increase, while EVs surged 6.8%, outperforming all other segments due to weaker comps from 2024.
• Conversion rates and retention dip modestly
  The average sales conversion rate declined to 54.9% in early July from 57.8% in June, indicating a slight softening in dealer demand. MMR retention dropped to 98.7%.
• Wholesale supply remains tight
  Mid-July wholesale supply held steady at 25 days, down 10% from the same period in 2024 and about two days below seasonal norms.
• Consumer sentiment rebounds slightly
  Morning Consult’s index rose 0.5% in the first half of July. Gasoline prices dropped 0.6% month-over-month and remain 10% year-over-year, offering consumers some relief.