Lane Watch: Looming UAW Strike Already Influencing Auction Action
Last week, ADESA chief economist Tom Kontos discussed what might happen to the used-car market if a strike involving manufacturing plant workers who build new vehicles for the Big 3 OEMs happens next month.
On Tuesday, Black Book noticed wholesale price implications already are starting to surface.
For the first time this month, analysts said wholesale prices didn’t drop by more than 1% in a single week. Black Book pegged last week’s drop at 0.86%, as the estimated average weekly sales rate declined to 48%.
Earlier in August, Black Book spotted weekly price drops of 1.52%, 1.45% and 1.10%.
“Wholesale declines continued last week, but the rate of decline did show some signs of slowing down with the overall rate depreciation coming back under 1% for the first time this month,” Black Book said in the newest installment of Market Insights released on Tuesday.
“Some dealers are starting to plan for the potential of a UAW strike and that is pushing them to the lanes to ensure they have inventory ‘just in case,’” analysts continued in the report.
Looking closer at cars, Black Book reported car prices softened by 0.83% on a volume-weighted basis last week. That’s less than half of the previous week’s wholesale price decline, which was 1.73%.
Analysts spotted a wide disparity in the price movements of older cars versus newer models. Black Book indicated values for cars 8 to 16 years old decreased by 1.49%, while prices for models 2 years old and newer ticked down by just 0.37%.