Things are getting better in a hurry for used car shoppers.
The average used car price fell in August, resuming an early-summer decline that was briefly interrupted in July. Now, the wholesale prices car dealers pay for the used cars they later sell have fallen.
Car dealers buy many used cars at auctions. The prices they pay at auction have already fallen 2.3% in the first 15 days of September. That comes after a 4% drop in August. When they pay less for used cars, they can charge less for them.
The Manheim Used Vehicle Value Index tracks the prices car dealers pay for used cars at auction. The index is a product of Kelley Blue Book parent company Cox Automotive.
Compared to August, every segment of the market saw prices drop. Full-size cars and sports cars saw the biggest decreases.
Americans have developed a renewed taste for fuel-efficient small cars amid the inflation and gas price hikes of 2022. Compact cars and pickups saw the smallest price drops.
The nationwide supply of used cars has begun to recover from early-pandemic lows. Dealers measure their supply of cars available for sale in a metric they call “days of inventory” — how long the current stock of vehicles would last if they couldn’t acquire more.
Used retail days’ supply averaged 48 days in early September — down just one day from August’s figure. Used car dealers had about a 48-day supply in early September 2019, before the first COVID-19 outbreak.
This story originally ran on KBB.com.