Manheim index shows 3.4% drop in first half of October

On the Dash:

• Early October saw a 3.4% decline in the Manheim Index from September, signaling typical seasonal depreciation after unusually strong pricing earlier in 2025.
• Luxury and EVs are holding value better year over year, while compact, mid-size, truck, and SUV segments show sharper declines, affecting inventory and pricing decisions.
• Wholesale supply remains tight but is slightly higher than in September, while consumer sentiment is weakening.

Wholesale used-vehicle prices declined in the first half of October, following weakness observed in late September. The mid-month Manheim Used Vehicle Value Index fell to 203.6, representing a 3.4% drop from the unadjusted values in September, though it was up 0.4% compared to the full October 2024. Seasonal adjustments intensified the decline.

Jeremy Robb, deputy chief economist at Cox Automotive, noted that the early October declines indicate a return to normal depreciation after unusually strong pricing earlier in 2025. He also stated that softer retail sales in late September signal weaker wholesale demand.

However, performance varied across vehicle segments, with luxury vehicles experiencing a 2.9% year-over-year increase. Meanwhile, SUVs decreased by 0.3%, trucks by 1.6%, mid-size cars by 3.3%, and compact cars by 5%.

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Conversely, in the first half of October, compact cars gained 1.6%, while trucks dropped by 1.2%, luxury vehicles fell by 1.4%, SUVs declined by 1.9%, and mid-size cars decreased by 2.3%. Electric vehicles saw a year-over-year increase of 3.5% but fell by 3.4% in September after the EV tax credits expired.

The wholesale supply rose slightly to 27 days in mid-October, up 1 day from September but still 7% below last year, remaining tighter than long-term averages.

Additionally, consumer sentiment has weakened, with the University of Michigan index decreasing by 0.2% in early October, down 22% year-over-year.

Ultimately, the Manheim data indicates that trends from early October suggest a continued seasonal depreciation. Factors such as segment-specific performance, changes in EV tax credits, and supply conditions are influencing wholesale pricing for the remainder of the month.