Lane watch: What pump prices are doing to compacts
Perhaps as some dealers hesitate to bid when prices climb before the hammer falls, compact cars continue to keep ringmen busy when those units roll over the block.
The latest Black Book Market Insights report showed prices for compact cars have climbed by 3 percent during the past six weeks. And Black Book executive vice president of operations Anil Goyal pinpointed a reason why.
"Compact cars see continued strength in the market, helped by rising gasoline prices," said Goyal, referencing data contained the report that has the average price at the pump well above $2.70 per gallon. That's more than 40 cents higher than the low point within Black Book's data set that went back to last April.
Volume-weighted, editors found that overall car segment values increased by 0.29 percent last week. In comparison, Black Book mentioned the values had increased on average by 0.20 percent per week during the previous two weeks.
Within cars, Black Book reported the midsize car and compact car segments increased the most in value last week, rising by 0.57 percent and 0.56 percent, respectively.
Again volume-weighted, editors determined overall truck segment values including pickups, SUVs, and vans decreased by 0.04 percent last week. In comparison, the values had decreased on average by 0.14 percent per week during the previous two weeks.
Among trucks, Black Book found that the sub-compact crossover segment increased the most in value last week, moving up by 0.23 percent.
Turning next to the anecdotes from the lanes Black Book collected last week, the story out of Florida outlined thoughts used-car managers in other places might have.
"Many buyers are actively bidding on vehicles but are getting hesitant to pay top dollar, fearing an upcoming market decline," a Black Book representative in the Sunshine State said.
Next door in Georgia, dealer feelings were expressed again but for a different reason.
"The institutional lanes were selling all of their vehicles for strong money. Dealers feel like the robust spring market may have a few more weeks of strong prices," Black Book's lane watcher in Georgia noted.
Up in Michigan, auction personnel are keeping close tabs on dealer activities.
"Factory inventory is quite constrained causing dealers to bid four or five extra times on the units that they want and need," the lane watcher noticed.
Finally, in Pennsylvania, winter might officially be in the rear-view mirror.
"Sales percentages are strong as inventory is tight, and the weather finally feels like spring," Black Book reported from the Keystone State.
Source: Auto Remarketing