NADA Used Car Guide Industry Update

Transcription

NADA Used Car Guide
Industry Update
January 2014

Used Vehicle Depreciation Slows in December
Prices slide by 1%; NADA’s used vehicle price index
slips to 124.8

Used Vehicle Prices Climb for Fifth Straight Year
The average price of units up to eight years in age
grows by 0.4% in 2013

January Official Used Car Guide® Movement
Average trade-in values lowered by an average of
1.4%

New Vehicle Sales Grow by 7.5% in 2013
Sales hit 15.5M to reach highest level since 2007’s
16.1M
Guidelines | January 2014
TABLE OF CONTENTS
New & Used Market Trends ........................................................................................................ 2
Economic Data ............................................................................................................................. 12
NADAguides.com Search Trends ................................................................................................. 15
NADA Official Used Car Guide Value Trends ............................................................................... 16
At NADA Used Car Guide ............................................................................................................. 17
NEW & USED MARKET TRENDS
December Closes out the Fifth Straight Year of Used Vehicle Price Growth
After declining by 1.5% in November, the rate of used vehicle depreciation pulled back
again for the second month in a row in December as wholesale prices for units up to
eight years in age fell by 1% on a prior-month basis.
The month’s performance saw NADA’s seasonally adjusted used vehicle price index drop
by 0.8 of a percentage point to 124.7 from November’s record high of 125.5. But despite
the decline, December’s figure stands as one of the highest reached
on NADA’s index.
Looking back to December 2012, used vehicle prices declined by a
much leaner 0.3%, however, the strength seen then was a direct
result of replacement demand for units destroyed by Hurricane Sandy.
By comparison, price declines in December 2010 and 2011 were 1%
and 0.9%, respectively, which are figures in line with 2013’s result.
Wholesale used vehicle prices
for units up to eight years in
age fell by 1% in December, a
half point improvement over
November’s 1.5% decline.
At the segment level, Large SUV prices decayed the most of any
segment for the month, dropping by 2.6% or 1.7 points more than
November’s slip of 0.9%. Given the minimal amount of depreciation
recorded for the segment throughout most of the year – prices fell by
a monthly average of just 0.8% from March through November – December’s result
should be viewed as an anomaly rather than deteriorating segment demand.
Luxury car prices fell by a similarly dramatic 2.1% in December, which is a slight increase
over November’s 1.9% decline. However, the stiffer drop in prices relative to most other
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2
[ NEW & USED MARKET TRENDS continued ]
segments isn’t uncommon for the time of year and
NADA Used Vehicle Price Index
Vehicles up to eight years in age. Seasonally adjusted.
in off-lease supply returning to the marketplace.
120
of 0.7% to 1.1%, in line with the overall market
110
80
Compact and mid-size utilities also performed well,
declining by 0.7% and 1%, respectively. Compact and
mid-size car prices fell by 1.1% and 0.8%, respectively,
Sep-13
Jul-12
Feb-13
Dec-11
Oct-10
May-11
Mar-10
Jan-09
Aug-09
Jun-08
Apr-07
Nov-07
Sep-06
Jul-05
Feb-06
Dec-04
Oct-03
May-04
Mar-03
Jan-02
Aug-02
Jun-01
Apr-00
Nov-00
Sep-99
Jul-98
Feb-99
Dec-97
Oct-96
70
figure of 2.6%.
May-97
decline was a 1.6% improvement over November’s
90
Mar-96
any segment in December. The segment’s 0.9%
100
Jan-95
2% range, luxury utility prices firmed up the most of
January 2010 = 100
Prices for remaining segments fell within a tight range
decline of 1%. After three months of declines in the
December 2013: Index falls to
124.7, down from November's
figure of 125.5.
130
Aug-95
was expected, particularly given the ongoing increase
Month
Source: NADA
Monthly AuctionNet Price Change - November v. December , 2013
Vehicles up to eight years in age.
0.2%
which is a slight improvement over November’s
-0.3%
-0.8%
prices firm up was mid-size vans, which improved by
-1.3%
0.7 of a point to land at 0.9% for the month. Large
pickups proved to be the only segment with no
Percent Change
figures of 1.5% and 1.4%. Another segment seeing
-0.7%
-0.8%
-0.8%
-0.9%
-0.9%
-1.0%
-1.1%
-1.0%
-1.8%
-2.1%
-2.3%
change in depreciation for the month as November’s
-2.8%
decline of 0.8% was carried over into December.
-3.3%
-2.6%
-3.8%
Compact Car
In annual terms, December concluded a fifth straight
year of used vehicle price appreciation, as 2013
ended with prices of units up to eight years in age
0.4% higher than they were in 2012 (and 18% higher
Compact
Utility
Large Pickup
Large SUV
Luxury Car Luxury Utility Mid-Size Car
Mid-Size
Utility
Mid-Size Van
Market
Average
Segment
Source: NADA
Source: NADA
Annual AuctionNet Price Change - Year-to-Date, 2012 v. 2013
Through December. Vehicles up to eight years in age.
12.0%
than they were prior to the start of the recession in
8.4%
consumer and commercial demand along with lower
gas prices and comparatively tight supply, large
8.0%
Percent Change
Supported by a unique combination of both
9.6%
10.0%
2007).
6.0%
3.7%
4.0%
2.3%
2.0%
0.4%
0.0%
pickup prices increased by 9.6% last year – the most
of any segment. While pickup supply continued to be
tight, large SUV supply was downright skeletal; as a
-0.5%
-2.0%
-0.7%
-1.0%
-0.7%
-1.5%
-4.0%
Compact Car Compact
Utility
Large Pickup Large SUV
Luxury Car
Luxury
Utility
Mid-Size Car
Mid-Size
Utility
Mid-Size
Van
Market
Average
Segment
Source: NADA
Source: NADA
3
result, prices for the segment grew by a dramatic 8.4% in
volume growth across the majority of age groups; not
2013. The mid-size van and mid-size utility segments saw
coincidentally, prices for these segments softened in
their price advantage over 2012 increase by 3.7% and
2013.
2.3%, respectively, while prices for remaining segments
At the opposite end of the spectrum, mid-size pickups
closed out the year down by a
and vans, large cars and large
tight range of 0.5% (compact
SUVs each saw auction volume
utilities) to 1.5% (luxury cars).
AuctionNet Volume Trends
Relative to 2012, the number of
AuctionNet wholesale
transactions of units up to eight
years in age declined by 1% in
2013. However, this figure masks
slide virtually across the board
Compared to 2012,
AuctionNet wholesale
transactions of units up to
eight years in age declined by
1% in 2013.
thereby helping to lift prices for
most of these segments last year.
Looking ahead to 2014, although
late-model (units up to five years
in age) volume will continue rise
for the majority of segments, it’s
considerable differences in trends
important to place volume levels
across vehicle age groups as
into historical context. NADA
expanding off-lease supply and
estimates that late model supply
moderately higher rental fleet pushed one- to four-year-
will grow by 8% on an annual basis
old unit volume up by 9.2%, while the recession-induced
in 2014; however, supply will remain some 12% below
decline in new sales from 2007 to 2009 was responsible
2009 levels even with the increase. The disparity in supply
will be especially
for an 11.2% drop
in five- to eightyear-old unit
volume.
At the extremes,
subcompact car,
mid-size car,
compact utility,
near luxury and
premium luxury
car, and luxury
compact utility
segments all
experienced
AuctionNet® Auction Volume: 2012 v. 2013
pronounced across
The annual change in auction volume by vehicle age. E.g. Ages 1-to-2 shows the
difference between 2012-13 MY volume in CY13 and 2011-12 MY volume in CY12.
Segment
Subcompact Car
Compact Car
Mid-Size Car
Large Car
Sport Car
Compact Utility
Mid-Size Utility
Large SUV
Mid-Size Pickup
Large Pickup
Mid-Size Van
Large Van
Luxury Compact Car
Luxury Mid-Size Car
Luxury Large Car
Premium Luxury Large Car
Luxury Sport Car
Luxury Compact Utility
Luxury Mid-Size Utility
Luxury Large Truck
Total
truck segments,
Ages 1-to-2
9%
3%
12%
-20%
10%
24%
6%
-21%
-40%
7%
-6%
2%
12%
-18%
-40%
58%
35%
27%
20%
4%
Ages 3-to-4
-1%
-4%
26%
-12%
11%
28%
20%
5%
12%
37%
-8%
-8%
24%
13%
-31%
73%
-17%
33%
10%
12%
Ages 5-to-6
11%
-14%
-13%
-32%
-24%
-24%
-24%
-47%
-37%
-28%
-31%
-32%
-22%
-26%
-23%
-39%
-41%
-40%
-21%
-43%
Ages 7-to-8
33%
5%
-4%
3%
1%
15%
-8%
21%
-14%
1%
-23%
6%
13%
7%
1%
22%
4%
37%
-5%
16%
Ages 1-to-8
8%
-2%
8%
-16%
0%
12%
-2%
-15%
-19%
-2%
-17%
-7%
8%
-3%
-23%
15%
-16%
9%
0%
-7%
4%
14%
-23%
1%
-1%
particularly midsize pickups, large
SUVs, mid-size vans
and large pickups.
For example, it’s
estimated that late
model large pickup
supply will grow by
just over 9% in
2014, but even so,
Source: NADA
4
supply will remain nearly 30% lower than 2009 levels.
This will not be the case for mid-size cars, compact utilities (luxury or otherwise) and
subcompact cars as late-model supply is expected to be higher, and in the latter two
cases significantly so, than 2009 levels this year.
January 2014 used vehicle price forecast
The modest budget deal reached by Congress and signed into law by President Obama in
December reduces the risk that consumer confidence – which has recovered
considerably since October’s federal government shutdown – will be arbitrarily
depressed by a lawmaker-induced crisis this month.
Given this and the fact that core market fundamentals continue to follow recent (and
largely favorable) trends, NADA believes January will turn in a performance in line with
the seasonal norm for the month.
Historically, used vehicle prices change little between December and January as dealer
acquisition activity begins to heat up in preparation for a spring surge in demand
stimulated by the receipt of tax rebate checks. After staying more or less flat in January,
prices commonly increase anywhere from 2% and 3% through March or April before
declining over the remainder of the year.
For 2014, NADA expects used vehicle prices in January will be flat to down just slightly
from December’s levels before rising by 2.5% to 3% through March.
By comparison, prices increased by a smaller 1.9% over the same
period last year as demand was tempered by higher payroll taxes
that went into effect at the start of 2013.
But while price movement is expected to be better than year-ago
levels through the first quarter, expanding late-model supply should
translate into moderately more severe depreciation over the
remainder of the year. As a result, used vehicle prices are expected
Used prices in January are
expected to be flat to down just
slightly before rising by 2.5% to
3% through March.
to fall on an annual basis for the first time since 2008.
Although NADA’s official forecast for 2014 won’t be released until
January 25th at the 2014 NADA Convention & Expo in New Orleans, preliminary results
point to prices for units up to eight model years in age being down by 1% to 2% on an
5
annual basis by year’s end.
(Note: February’s edition of Guidelines will contain NADA’s final forecast for the year.)
January Official Used Car Guide® value movement
Trade-in values in the January 2014 edition of the Official Used Guide® were lowered by
an average of 1.4% relative to the December 2013 edition. Truck values were pulled
down by an average of 1.6% due to pronounced adjustments in the compact utility, midsize van and luxury utility segments averaging 2%. Value reductions for other truck
segments – large vans, mid-size and large pickups, mid-size utilities, and large SUVs –
ranged from 0.7% (large SUVs) to 1.4% (large vans).
As for cars, values overall were lowered by 1.2% making the month the first since April
2013 where car adjustments were less severe than trucks. Luxury car segments
experienced the steepest cuts in value with adjustments averaging 2.7%, while mid-size,
subcompact and compact car reductions fell within a less severe range of 0.6% to 1% (in
that order).
On a full-year basis, trade-in values for 2006 – 2013 model year units were reduced by a
cumulative average of 15.9% in 2013, down slightly from 2012’s like-age (2005 – 2012
model years) figure of 16.1%. Car and truck values ended the year down by 17.6% and
13.5%, respectively. Dropping by an average of nearly 21%, luxury car values suffered
most last year; conversely, large SUV and pickup (mid-size and large) values slipped by
an average of just 8.4%. The voluminous compact and mid-size car segments saw values
reduced by an average of 17.2%, while values for the industry’s largest truck segment
(based on new sales) – mid-size utilities – were
New Vehicle Sales
lowered by an average of 15.7%.
New Vehicles Sales
Sales Volume (millions)
1.35 million units, an increase of a mere 541 units, and
15%
1.2
10%
1.0
0.8
5%
0.6
0%
0.4
were up only 0.04% after posting healthy year-over-
0.2
year gains for much of 2013. For the year, the industry
0.0
-5%
-10%
was up a solid 7.5%, achieving over 15.5 million sales
Month
Source: Wardsauto.com
6
Percent Change
Sales slowed a bit in December to settle at just over
20%
1.4
New Vehicle Sales Reach Highest Annual
Total Since 2007
YoY Change
1.6
compared to last year’s 14.4 million deliveries.
New Vehicle SAAR
The seasonally-adjusted annual rate (SAAR) rose
SAAR
previous year’s figure of 15.18 million, an increase of
unsatisfactory given the industry’s stellar November
performance, the month’s figure was the sixth highest
scored in 2013.
Domestic performance slips as GM’s sales
fall
The Big Three posted disappointing sales of 601,000
14%
16
12%
8%
14
6%
13
rosier picture, however, as the domestics combined to
sell over 7.01 million vehicles, which was an 8.8%
increase.
Chrysler Group led U.S. automakers with a moderate
5.6% growth in sales after delivering nearly 160,000
units in December, and for the year the company
achieved 1.79 million sales for a healthy 9%
improvement. While positive, overall results for
December left much to be desired as the Chrysler,
Dodge and Fiat brands collectively sold 12% fewer
vehicles than a year ago. Fortunately, Jeep and Ram
maintained their strong momentum to grow sales by
34% and 17%, respectively, with the new Jeep Cherokee
standing out the most with its 15,038 deliveries – a
329% leap over the discontinued Liberty.
Ford Motor Company had a quieter month as its sales
grew by 1% after selling 211,000 units, but its year-todate figures were very good as its 2.44 million deliveries
4%
12
2%
11
0%
Month
Mainstream Brand Performance (Units Sold)
units in December, down 0.8%, as results varied among
the three companies. The year’s final numbers paint a
10%
15
Buick
Chevrolet
Chrysler
Dodge
Fiat
Ford
GMC
Honda
Hyundai
Jeep
Kia
Mazda
Mini
Mitsubishi
Nissan
Ram
Scion
Smart
Subaru
Toyota
Volkswagen
Dec-13
15,379
153,493
20,270
47,689
3,745
203,369
43,120
119,504
63,005
53,275
33,631
22,964
6,592
6,423
96,526
34,788
4,323
855
40,172
151,763
34,015
Nov-13
15,072
145,089
21,024
41,506
3,075
178,378
35,727
101,948
56,005
45,415
45,411
20,754
4,575
6,071
93,376
30,159
4,968
959
36,621
147,465
30,727
Dec-12
16,473
167,091
25,513
52,391
3,707
201,782
43,921
116,740
59,435
39,871
39,178
27,253
6,456
4,113
86,663
29,831
5,522
996
36,653
158,014
44,005
Change From
Month Ago
Year Ago
2%
-6.6%
6%
-8.1%
-4%
-20.6%
15%
-9.0%
22%
1.0%
14%
0.8%
21%
-1.8%
17%
2.4%
12%
6.0%
17%
33.6%
-26%
-14.2%
11%
-15.7%
44%
2.1%
6%
56.2%
3%
11.4%
15%
16.6%
-13%
-21.7%
-11%
-14.2%
10%
9.6%
3%
-4.0%
11%
-22.7%
Dec-12
16,034
14,841
37,399
18,248
12,627
1,049
5,174
30,607
7,384
30,375
2,952
6,150
Change From
Month Ago
Year Ago
8%
-1.8%
25%
15%
18%
-0.03%
12%
-0.5%
1%
4.8%
7%
47%
25%
11%
36%
14%
19%
8.1%
-2%
18%
-18%
10%
15%
-21%
Source: Wa rds Auto
Luxury Brand Performance (Units Sold)
Acura
Audi
BMW
Cadillac
Infiniti
Jaguar
Land Rover
Lexus
Lincoln
Mercedes-Benz
Porsche
Volvo
Dec-13
15,751
17,013
37,389
18,165
13,232
1,544
5,764
34,757
7,984
35,835
3,246
4,888
Nov-13
14,559
13,636
31,752
16,172
13,152
1,446
4,601
25,611
6,727
36,386
3,966
4,233
Source: Wa rds Auto
7
Percent Change
0.8%. Although December’s SAAR appears relatively
New Vehicle SAAR (millions)
slightly to 15.3 million units in December from the
YoY Change
17
translated into 10.4% growth. In December, the Lincoln
down 23%. Thus, most brands moved in the right
brand made solid gains with sales up 8.1% while the Ford
direction, but their gains were offset by a fraction of the
brand settled for a slight 0.8% uptick on 203,000 sales.
other importers where sales fell significantly.
The more notable models to underperform were the
Focus (down 31%) and Taurus (down 22%), but the Fusion
(up 27%) and Escape (up 22%) played significant roles in
balancing out the product portfolio’s performance.
Excluding Mitsubishi (up 56%), the Japanese automaker
with the biggest improvement in December was Nissan,
whose sales rose by 11% making the company the first in
months to surpass Subaru’s growth rate (up 9.6%).
General Motors fell behind its domestic peers in
Meanwhile, Mazda’s sales were down nearly 16% after
December as it sold 6.3% fewer units year-over-year on
deliveries of its highest-selling model, the Mazda 3, fell by
230,000 deliveries, yet the manufacturer still had a
26%. However, an explanation for the drop may be that
bounce-back year in 2013 with its 2.79 million sales
the company is beginning production of the newest
reflecting a 7.3% improvement. None of the GM brands
generation of its popular compact at its new plant in
managed to increase sales in December as Cadillac’s 0.5%
Mexico in January 2014.
dip bested GMC (down 1.8%), Buick (down 6.6%) and
Chevrolet (down 8.1%). Much of Chevrolet’s slide was a
result of falling Silverado and Cruze sales, down 16% and
15%, respectively, but it could have been worse if it were
not for gains from the Malibu (up 33%) and Impala (up
10%) sedans.
Nissan North America leapfrogged its Japanese Big Three
peers in December with 11% growth on 110,000 sales
while its 1.25 million deliveries for 2013 was a 9.4% climb.
Complementing Nissan brand growth, Infiniti sales were
up over 13,200 units, reflecting a 4.8% increase. Infiniti
was led by its QX50 SUV (which replaced the JX moniker
Imports exhibit minute increase as brands post
from the prior model year) where sales increased by 38%,
mixed results
while Nissan got a boost from its Maxima, Frontier and
Sentra models where sales grew by 57%, 47% and 39%,
Import sales were flat at 0.6% growth to finish the month
respectively.
at just under 750,000 sales, but they eclipsed 8.5 million
sales for the year, up 6.3%. Aside from the U.K., whose
Jaguar Land Rover sales were up 17%, the nation with the
highest sales bump in December was Japan, up a marginal
1.8%, while every other country experienced a decline in
deliveries. The results are somewhat misleading,
however, as only eight out of 22 foreign brands had sales
decreases (excluding Smart) and were down 8.6%,
collectively. Further putting things into perspective, sales
for five of the eight nameplates were down 14% or
American Honda Motor Co. realized a small gain with
135,000 sales for the month, up 1.9%, while its calendar
year deliveries of 5.79 million units were a 7.2% increase.
Acura’s December sales dipped by 1.8% after it sold
15,800 vehicles while Honda achieved 120,000 sales,
good for a 2.4% bump. While the Acura TL and TSX
combined to sell 36% fewer units, they will both soon be
replaced by the new TLX which will debut at the 2014
Detroit Auto Show and go on sale later this year. Honda’s
greater, anchored by Volkswagen whose deliveries were
8
slower month was due to sales of its high volume Civic sedan dropping by 12%, but the
brand made up for the lost sales with its CR-V and Accord models selling 12% and 9.8%
units more, respectively.
Toyota Motor Sales was the only one of the Japanese Big Three to experience a sales
decline in December as its 191,000 sales was a 1.7% drop, but its 12 month tally of 2.24
million units placed annual growth at a solid 7.4%. For the month, Lexus shined with
nearly 35,000 deliveries to grow by 14%, while Toyota was down 4% after selling fewer
than 152,000 vehicles. Much of the positive news for Lexus was thanks to brisk sales of
its IS sedan, which were up 117%, whereas Toyota was supported by its RAV4 (up 46%)
and Avalon (up 20%) models as deliveries of the Camry and Corolla were down a
combined 6.3%. Unable to generate positive momentum, Scion’s sales moved down
again with its 4,300 deliveries representing a 22% decrease.
Although European brand sales were down 1.5% in December, only Volkswagen (down
23%), Volvo (down 21%) and BMW (down 0.03%) failed to realize positive growth
(excluding Smart, which sold only 855 Fortwo models). Aside from Mini (up 2.1%), all
other brands enjoyed no less than 10% growth and Mercedes-Benz and Audi stood out
as big winners with deliveries up 18% and 15%, respectively. The well-received E-Class
(up 25%) and S-Class (up 67%) led Mercedes and were supplemented by the new CLA
sedan, which added 3,285 units, while Audi benefitted from strong gains by its Q7 (up
53%), A6 (up 43%) and Q5 (up 32%) models.
Incentive spending leaps to its highest point
in over two years
Incentives
Average of Total
it placed spending at a level last exceeded in August
2010.
General Motors took a different approach with its
Average Incentive Spending
was the third highest recorded since March 2012 and
$2,700
8%
6%
$2,500
4%
2%
$2,400
0%
$2,300
-2%
-4%
$2,200
-6%
$2,100
mainstream brands last month as its spending on
Chevrolet and GMC dropped 1% and 5%, respectively,
10%
$2,600
-8%
Month
Source: Autodata
9
Percent Change
$2,761. The month’s 7.6% year-over-year increase
14%
12%
Per Autodata, incentives jumped for the third
consecutive month in December to an average of
YoY Change
$2,800
which likely had an effect on the two brand’s sales performances (down 6.8%
combined). On the other hand, in spite of respective increases of 43% and 28% for Buick
and Cadillac, their collective deliveries fell 3.4% in the face of stiff competitive from
other premium marques. The Ford brand raised incentives by 25% and discounts at
Lincoln were up 6%, but the strategy proved ineffective with sales up only 1%. Chrysler
incentives were up 7% while Dodge’s were down 2%, but the good news for Chrysler
Group LLC was how its sales leader Jeep was able to increase sales by an impressive 34%
despite pulling back spending by 14%.
Toyota Motor Sales was the only one of the Japanese Big Three to raise incentives for
both its volume and luxury brands as Toyota and Lexus rebates were up 6% and 12%,
respectively (yet total sales were down 1.7%). American Honda Motor Co. went in
opposite directions with its brands as Honda spent 26% to increase sales slightly while
Acura cut spending by 20% and saw a small sales dip. The Nissan brand’s incentives rose
19% and Infiniti’s spending decreased by 4%, yet both nameplates had solid months.
Incredibly, Subaru, already the lowest spender among mainstream brands, cut spending
by 20% to $835 per unit and its deliveries still improved by 9.6%. Also impressive were
luxury makes Porsche and Land Rover as the two slashed spending per unit down to
$664 (down 53%) and $727 (down 64%), respectively, yet each achieved sales increases
of 10% or greater.
Mimicking last month, dealer cash and lease subvention increased, up 12.7% and 1.7%,
respectively, while finance incentives were down 8%. For the 11th consecutive month,
customer cash usage went up year-over-year, rising by 6.6%.
On an annual basis, total incentive spending grew by 3.7% to an average of $2,576 in
2013 with an 8.3% rise in consumer cash spending primarily responsible for the
increase. Finance and lease subvention fell by 0.8% and 0.1%, respectively, while dealer
cash increased by 6.5%. Total spending is now at its highest level since 2010 but it
remains nearly 5% below the 2003 – 2007 pre-recession average of $2,718.
Overall new vehicle days’ supply climbs by five days versus prior year
Following the same pattern as years past, inventory fell in December, decreasing by 13
days to 64 days versus the prior month, while rising by five days compared to the
previous year. Buick (up two days) and Porsche (up nine days) were the only two brands
10
to experience an increase in inventory, finishing the month at 115 days and 55 days,
respectively. Among luxury brands, domestic makes Lincoln (down 27 days) and Cadillac
(down 23 days) realized the greatest reduction in inventory, settling at 83 days and 92
days, respectively.
New Vehicle Days' Supply
Days' Supply
YoY Change
90
18
80
13
60
8
50
40
3
30
20
-2
10
0
-7
Month
11
Day Change
Days of Supply
70
[ ECONOMIC TRENDS ]
Another month of robust hiring follows other positive economic news. The economy
expanded at an annual rate of 3.6% in the July-September quarter, the fastest growth
since early 2012. Still, nearly half that gain came from businesses building their
stockpiles. The recent economic upturn has been surprising; many economists expected
the government shutdown in October to hobble growth, yet the economy motored
along without much interruption.
The federal government shutdown in the first half of October had a small impact on
fourth quarter economic growth. Some federal workers on unpaid leave put off
purchases because of the uncertainty, but they resumed spending once they were paid
in full after the shutdown ended.
Monetary policy is in a period of transition as Federal Reserve Chairman Ben Bernanke’s
term is set to expire at the end of January 2014. The Federal Open Market Committee
(FOMC) is expected to maintain the current $85 billion per month of central bank
purchases of long-term Treasuries and mortgage-backed securities until their last
meeting under Chairman Bernanke in late January. At that point, the FOMC will start to
gradually reduce its asset purchases, wrapping them up by the end of 2014. This will
lead to a steady increase in long-term interest rates, but the underlying fundamentals of
the economy should be strong enough to withstand the higher rates.
Short-term rates will remain near zero for another couple of years. The FOMC has stated
that it will not begin to raise the federal funds rate at least until the unemployment rate
falls below 6.5%, which will likely happen at the end of 2014. But that is a threshold, not
a trigger, and the Committee has made it clear that the funds rate will remain close to
zero for a while after the unemployment rate falls below 6.5%.
A fourth straight month of solid hiring cut the U.S. unemployment rate in November to a
five-year low of 7% and the gains in the job market could spur greater economic growth.
The Labor Department reported that employers added 203,000 jobs, nearly matching
October's revised gain of 200,000.
The economy has now generated an average of 204,000 jobs from August through
November. That's up from 159,000 a month from April through July. Many of the
November job gains were in higher-paying industries. Manufacturers added 27,000
positions, the most since March 2012, while construction firms gained 17,000. The two
12
[ ECONOMIC TRENDS continued ]
industries have created a combined 113,000 jobs in the past four months.
Greater hiring could support healthier spending as job growth has a dominant influence
over much of the economy. If hiring continues at the current pace, a virtuous cycle starts
to build with more jobs leading to higher wages, more spending and faster growth.
But more higher-paying jobs are also necessary.
Roughly half the jobs that were added in the six
Total Housing Starts, Privately Owned
Seasonally Adjusted
1300.0
industries: retail; hotels, restaurants and
1100.0
entertainment; temp jobs; and home health care
workers.
Existing-home sales declined for the second
Housing Starts (thousands)
months through October were in four low-wage
900.0
700.0
500.0
300.0
inventory means home prices continue to see double-
100.0
Jan-08
Mar-08
May-08
Jul-08
Sep-08
Nov-08
Jan-09
Mar-09
May-09
Jul-09
Sep-09
Nov-09
Jan-10
Mar-10
May-10
Jul-10
Sep-10
Nov-10
Jan-11
Mar-11
May-11
Jul-11
Sep-11
Nov-11
Jan-12
Mar-12
May-12
Jul-12
Sep-12
Nov-12
Jan-13
Mar-13
May-13
Jul-13
Sep-13
Nov-13
consecutive month in October, while constrained
digit year-over-year gains, according to the National
Association of Realtors. Total existing-home sales fell
Month
Source: U.S. Census Bureau
3.2% to a seasonally adjusted annual rate of 5.12
million in October from 5.29 million in September, but
S&P/Case-Shiller 20-City Composite Home Price Index
Three-month moving average published with a two-month lag.
are 6% higher than the 4.83 million-unit level in
190.0
180.0
October 2012. Sales have remained above year-ago
housing types was $199,500 in October, up 12.8%
from October 2012, which is the 11th consecutive
month of double-digit year-over-year increases. Total
housing inventory at the end of October declined
1.8% to 2.13 million existing homes available for sale,
160.0
150.0
140.0
130.0
120.0
110.0
100.0
Jan-08
Mar-08
May-08
Jul-08
Sep-08
Nov-08
Jan-09
Mar-09
May-09
Jul-09
Sep-09
Nov-09
Jan-10
Mar-10
May-10
Jul-10
Sep-10
Nov-10
Jan-11
Mar-11
May-11
Jul-11
Sep-11
Nov-11
Jan-12
Mar-12
May-12
Jul-12
Sep-12
Nov-12
Jan-13
Mar-13
May-13
Jul-13
Sep-13
The national median existing-home price for all
170.0
Index Level
levels for the past 28 months.
Month
Source: S&P Dow Jones
which represents a 5-month supply at the current sales pace; the relative supply was 4.9
months in September. Unsold inventory is 0.9% above a year ago when there was a 5.2month supply.
Despite an increase in the U.S. average retail price of regular gasoline to $3.29 per gallon
on Nov. 25, gasoline prices remain near the lowest level of 2013 and last year at this
13
[ ECONOMIC TRENDS continued ]
time. Lower global crude oil prices, high profitability for diesel fuel that has been
encouraging refiners to increase throughput, high inventories and the switch to lesscostly winter grades of gasoline are among the factors currently driving gasoline prices.
Spot prices for Brent crude oil dropped $4.66 per barrel from Sept. 3 to Nov. 25. West
Texas Intermediate (WTI) crude prices, which are
much less significant to gasoline price formation than
Regular Grade Gasoline Prices (all formulations)
Average Price Per Gallon
$ YoY Change
$4.00
$0.40
period. The decline in crude oil prices was partly
$3.90
$0.30
$3.80
$0.20
$3.70
$0.10
$3.60
$0.00
$3.50
($0.10)
$3.40
($0.20)
to decline further to $106 and less than $95 per barrel
$3.30
($0.30)
in December, respectively, and down further to $101
$3.20
($0.40)
$3.10
($0.50)
refinery maintenance. EIA's November Short-Term
Energy Outlook (STEO) forecasts Brent and WTI prices
Average Price
driven by lower demand for crude oil due to seasonal
and $93 by the end of 2014. However, heightened
uncertainties surround this forecast because of global
crude oil supply disruptions.
Fiscal policy has been a significant drag on economic
Month
Source: U.S. Energy Information Administration
On-Highway Diesel Fuel Prices
Average Price Per Gallon
$ YoY Change
$4.15
$0.20
to the shutdown, increases in the federal personal
$4.10
$0.15
$4.05
$0.10
$4.00
$0.05
$3.95
$0.00
$3.90
($0.05)
$3.85
($0.10)
$3.80
($0.15)
$3.75
($0.20)
$3.70
($0.25)
consumer spending this year. The spending cuts under
the sequester that took effect in the spring have also
been a drag on growth.
Average Price
income tax and the Social Security payroll tax have
But taxes are not expected to increase in 2014, and
any spending cuts next year will be smaller than this
Month
Source: U.S. Energy Information Administration
year’s. There is still the potential for another
government shutdown in early 2014 – the spending agreement that reopened the
government only lasts until Jan. 15 – and Congress will need to raise the debt limit again
in February. But given the public outcry over the last shutdown, Congress is highly likely
to keep the government open and raise the debt limit on time.
14
Price Change
growth in 2013, but that will fade in 2014. In addition
weighed on growth in disposable income and
Price Change
Brent prices, fell by $14.81 per barrel over the same
[ NADAGUIDES.COM SEARCH TRENDS ]
NADAguides.com is the most comprehensive vehicle information website on the internet today, offering a broad
range of information and services to help educate consumers in the market to buy, sell, trade, or simply shop for a
vehicle. NADAguides is an alliance partner of NADA Services Corporation.
The figures contained below are based on consumer activity on nadaguides.com and are calculated by comparing
the number of unique lookups between December 2012 and 2013.
Annual Change in Consumer Activity: Used Make
Annual Change in Consumer Activity: New Make
Subaru
27%
Mazda
20%
Dodge
18%
Audi
13%
Lincoln
12%
Mercedes-Benz
6%
Kia
4%
Ford
0%
Jeep
-1%
Acura
-1%
Nissan
-2%
Smart
-2%
Cadillac
-3%
Lexus
-5%
Chrysler
-6%
Toyota
-7%
Infiniti
-8%
Buick
-8%
Honda
-9%
Volkswagen
-15%
Chevrolet
-17%
Porsche
-17%
Volvo
-19%
Mitsubishi
-19%
GMC
-22%
BMW
-22%
MINI
-22%
Hyundai
-25%
Land Rover
Jaguar
Scion
-40%
-25%
-27%
-28%
-30%
Source: NADAguides.com
-20%
-10%
0%
10%
20%
Percent Change
1
2
3
4
5
6
7
8
9
10
MY
2013
2014
2013
2014
2014
2013
2014
2014
2013
2014
MAKE
Ford
Chevrolet
Chevrolet
Ram Truck
Ford
Ram Truck
Ford
Jeep
Nissan
Honda
5%
5%
4%
2%
1%
0%
0%
0%
0%
0%
0%
0%
-1%
-1%
-1%
-1%
-1%
-2%
-2%
-2%
-2%
-2%
-3%
-3%
-4%
-4%
-4%
-5%
-5%
-6%
-8%
-8%
-8%
-10%
-15%
30%
-10%
-5%
0%
5%
10%
Percent Change
Source: NADAguides.com
Top 10 Researched New Models
Rank
GMC
Kia
Subaru
Jeep
Saturn
Mercury
Buick
Acura
Audi
Mazda
Nissan
Chrysler
Cadillac
Porsche
Chevrolet
Volvo
Dodge
Infiniti
Ford
MINI
Hummer
Hyundai
Lexus
Lincoln
Mercedes-Benz
Pontiac
Honda
Saab
Scion
Toyota
Mitsubishi
Volkswagen
BMW
Suzuki
Land Rover -13%
Jaguar -13%
Top 10 Researched Used Models
MODEL
F-150
Silverado 1500
Silverado 1500
1500
F-150
1500
Mustang
Grand Cherokee
Altima
Accord Sedan
Rank
1
2
3
4
5
6
7
8
9
10
MAKE
Ford
Chevrolet
Dodge
Honda
Toyota
Ford
BMW
Nissan
Chevrolet
Jeep
MODEL
F-150
Silverado 1500
Ram 1500
Accord Sdn
Camry
Mustang
3 Series
Altima
Tahoe
Grand Cherokee
15
[ NADA OFFICIAL USED CAR GUIDE® TRENDS ]
Monthly Change in NADA Used Car Guide Value
December 2013 v. January 2014
NADA Segment
2009MY
2010MY
2011MY
2012MY
2013MY*
Compact Car
Compact Utility
Large Pickup
Large SUV
Luxury Car
Luxury Utility
Mid-Size Car
Mid-Size Utility
Mid-Size Van
-1.3%
-2.1%
-1.1%
-0.5%
-2.2%
-1.9%
-1.2%
-1.4%
-3.2%
-1.1%
-2.3%
-0.8%
-0.8%
-3.2%
-1.7%
-0.7%
-1.0%
-2.8%
-0.7%
-2.2%
-1.0%
-0.9%
-2.3%
-1.4%
-0.6%
-0.8%
-1.8%
-0.6%
-1.8%
-1.1%
-1.5%
-2.0%
-1.3%
-0.6%
-0.6%
-1.5%
-0.9%
-2.4%
0.3%
-0.4%
4.2%
-0.8%
-0.8%
-1.2%
-1.5%
*Value movement can be influenced by newly valued vehicles.
Annual Change in NADA Used Car Guide Value
January, 2013 v. 2014
NADA Segment
5YR
4YR
3YR
2YR
1YR
YoY Segment
Change
Compact Car
Compact Utility
Large Pickup
Large SUV
Luxury Car
Luxury Utility
Mid-Size Car
Mid-Size Utility
Mid-Size Van
-2.0%
0.3%
10.3%
2.5%
0.1%
7.2%
-2.5%
4.0%
4.6%
2.1%
1.5%
5.0%
-0.6%
1.6%
3.2%
8.6%
3.6%
0.6%
-1.6%
0.2%
10.8%
3.3%
-1.0%
-4.0%
-0.3%
1.0%
12.1%
0.8%
-0.3%
4.8%
2.0%
7.9%
0.3%
2.6%
-0.1%
3.0%
0.3%
0.8%
6.1%
1.2%
6.9%
0.4%
3.5%
0.7%
5.9%
0.3%
-0.9%
7.7%
1.9%
5.3%
-0.2%
1.9%
2.5%
3.6%
*Calculations are based on vehicle age, i.e. values for 1 year old vehicles in CY2013 are compared against values for 1 year old vehicles in CY2012.
YTD Change in NADA Used Car Guide Value
January — December 2013
NADA Segment
2008MY
2009MY
2010MY
2011MY 2012MY* YTD Segment Change
Compact Car
Compact Utility
Large Pickup
Large SUV
Luxury Car
Luxury Utility
Mid-Size Car
Mid-Size Utility
Mid-Size Van
-16.0%
-15.0%
-5.6%
-12.9%
-16.6%
-16.4%
-14.4%
-15.9%
-16.6%
-16.1%
-13.5%
-5.1%
-11.6%
-14.8%
-13.3%
-13.3%
-13.9%
-13.2%
-14.3%
-11.8%
-3.7%
-9.7%
-15.0%
-13.7%
-12.9%
-11.2%
-10.9%
-13.6%
-10.2%
-1.9%
-6.5%
-15.0%
-12.7%
-12.3%
-10.9%
-9.8%
-13.8%
-9.9%
-2.3%
-7.1%
-8.2%
-11.1%
-11.8%
-10.7%
-8.9%
-14.5%
-11.6%
-3.6%
-9.2%
-12.7%
-13.0%
-12.6%
-12.2%
-11.2%
16
AT NADA USED CAR GUIDE
What’s New
Available on iPhone, iPad and Android devices, NADA MarketValues is the fastest, easiest and
most cost-efficient way to make smart vehicle decisions on the go. Subscriptions start at $50
per month and when you download NADA MarketValues from Google Play or the Apple Store
for $1.99, you’ll receive a FREE 30-day trial!
On the Road
Mike Stanton, John Beckman, Steve Stafford and Jonathan Banks will be attending the 18th
Annual AFSA Vehicle Finance Conference & Exposition from January 22 to January 24 in New Orleans. If you are attending, please
stop by our booth and see Steve. Also at the conference, on Wednesday, January 22 at 4:15 p.m., Jonathan Banks will speak on a
panel about key trends in risk management.
Join us at the NADA Used Car Guide booth #3939 at the 2014 NADA Convention & Expo in New Orleans from January 24 to January
27 and learn about the enhanced NADA MarketValues, enhanced NADA AppraisalPRO and new NADA Appraisal. Exclusive to NADA
and NIADA members, we have two convention promotions: a free iPad mini with an annual subscription to NADA AppraisalPRO or 60
days free of NADA MarketValues.
Also at the 2014 NADA Convention & Expo, Mike Stanton will highlight the company’s initiatives to kick off the NADA Used Car Guide
press conference on Saturday, January 25. Jonathan Banks will then discuss new and used vehicle market trends, as well as how
market conditions will affect used vehicle depreciation and prices in 2014.
About NADA Used Car Guide
Since 1933, NADA Used Car Guide has earned its reputation as the leading provider of vehicle valuation
products, services and information to businesses throughout the United States and worldwide. NADA’s
editorial team collects and analyzes over one million combined automotive and truck wholesale and
retail transactions per month. Its guidebooks, auction data, analysis, and data solutions offer
automotive/truck, finance, insurance and government professionals the timely information and
reliable solutions they need to make better business decisions. Visit nada.com/b2b to learn more.
Financial Industry,
Accounting, Legal,
OEM Captive
Steve Stafford
800.248.6232 x7275
sstafford@nada.org
Credit Unions, Fleet,
Lease, Rental Industry,
Government
Doug Ott
800.248.6232 x4710
dott@nada.org
Automotive Dealers,
Auctions, Insurance
Jim Dodd
800.248.6232 x7115
jdodd@nada.org
Director, Sales
and Customer Service
Dan Ruddy
800.248.6232 x4707
druddy@nada.org
Automotive OEMs
Stu Zalud
800.248.6232 x4636
szalud@nada.org
PR Manager
Allyson Toolan
800.248.6232 x7165
atoolan@nada.org
Business Development
Manager
Jim Gibson
800.248.6232 x7136
jgibson@nada.org
17
NADA CONSULTING SERVICES
NADA’s market intelligence team leverages a database of nearly 200 million automotive transactions and more than
100 economic and automotive market-related series to describe the factors driving current trends to help industry
stakeholders make more informed decisions. Analyzing data at both wholesale and retail levels, the team continuously
provides content that is both useful and usable to the automotive industry, financial institutions, businesses and
consumers.
Complemented by NADA’s analytics team, which maintains and advances NADA’s internal forecasting models and
develops customized forecasting solutions for automotive clients, the market intelligence team is responsible for
publishing white papers, special reports and the Used Car & Truck Blog. Throughout every piece of content, the team
strives to go beyond what is happening in the automotive industry to confidently answer why it is happening and how it
will impact the market in the future.
Senior Director, Vehicle
Analysis & Analytics
Jonathan Banks
800.248.6232 x4709
jbanks@nada.org
Senior Manager,
Market Intelligence
Larry Dixon
800.248.6232 x4713
ldixon@nada.org
Automotive Analyst
David Paris
800.248.6232 x7044
dparis@nada.org
Automotive Analyst
Joseph Choi
800.248.6232 x4706
jchoi@nada.org
ADDITIONAL RESOURCES
Guidelines
White Papers
Updated monthly with a robust data set
from various industry sources and
NADA’s own proprietary analytical tool,
Guidelines provides the insight needed
to make decisions in today’s market.
NADA’s white papers and special reports
aim to inform industry stakeholders on
current and expected used vehicle price
movement to better maximize today’s
opportunities and manage tomorrow’s risk.
NADA Perspective
Used Car & Truck Blog
Leveraging data from various industry
sources and NADA’s analysts, NADA
Perspective takes a deep dive into a
range of industry trends to determine
why they are happening and what to
expect in the future.
Written and managed by the Market
Intelligence team, the Used Car & Truck
Blog analyzes market data, lends insight
into industry trends and highlights
relevant events.
Connect with NADA
Read our Blog
Follow Us on Twitter
Find Us on Facebook
Watch Us on YouTube
nada.com/usedcar
@NADAUsedCarGde
Facebook.com/NADAUsedCarGuide
Youtube.com/NADAUsedCarGuide
Disclaimer: NADA Used Car Guide makes no representations about future performance or results based on the data and the contents available in this report (“Guidelines”). Guidelines is
provided for informational purposes only and is provided AS IS without warranty or guarantee of any kind. By accessing Guidelines via email or the NADA website, you agree not to reprint,
reproduce, or distribute Guidelines without the express written permission of NADA Used Car Guide.
18

NADA Used Car Guide Industry Update

Transcription

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