On the Dash:
- Older, lower-priced used vehicles are holding their value better as consumers seek more affordable transportation.
- Retail used vehicle supply tightened to 44 days at the end of August, supporting continued wholesale demand.
- EV wholesale values remain above year-ago levels despite recent declines, while non-EV values have fallen below 2025 levels.
The Manheim Used Vehicle Value Index reached 208.2 in August. When adjusted for factors such as vehicle mix, mileage, and seasonal trends, wholesale prices increased by 0.4% year over year. However, prices fell by 0.9% compared to July, which contrasts with the typical expected increase of 0.5% in August. Non-adjusted prices rose 0.2% year over year but fell 0.5% from July.
Affordable used vehicles are showing better retention rates, as older vehicles are depreciating less than newer models, with nine- and ten-year-old vehicles holding six percentage points above their long-term depreciation averages. According to Cox Automotive, this trend indicates an increased demand for affordable used vehicles. Moreover, the rising average age of vehicles and higher repair costs further support demand for used vehicles.
Used retail sales increased throughout August, reducing inventory supply. By the end of August, the retail days’ supply fell to 44 days, down two days from July. This stronger retail demand is encouraging dealers to continue sourcing inventory through wholesale channels.
The EV Index rose 4.5% year over year but fell 4.7% from July. In contrast, the Non-EV Index fell 0.9% year over year and 0.6% from July. Although both segments depreciated month over month, EVs remain valued higher than they were a year ago.
In August, Manheim Market Report (MMR) prices for three-year-old vehicles fell 1.8%. MMR retention averaged 99.5%, up 0.3 percentage points from July. Sales conversion rates improved to 57.2%, up 3.5 points from July, but remain below the three-year August average. Additionally, the wholesale days’ supply stood at 27 days, down 1.4 days from July but up 2.3 days from the previous year.
