Used Vehicle Value Index

Throughout the month, daily MMR Retention, which is the average difference in price relative to the current MMR, averaged 99%, meaning market prices moved further below MMR values and were lower against August levels by 0.8%. Compared to last year, valuation models were down by 0.3% for MMR retention and below other years for the month, except for 2022. The average daily sales conversion rate also declined to 58.3%, a decline of 2.7 percentage points against last month but generally higher than normally seen at this time of year. For comparison, the daily sales conversion rate averaged 57% in September over the last two years, indicating stronger-than-average sales conversion for this time of year and suggesting a more favorable market for sellers.

Major market segments remain mixed for seasonally adjusted prices year over year in September. Compared to the same month last year, the luxury segment continues to be up the most, as it is influenced by trends in the electric vehicle (EV) segment, and it was higher by 2.3%, with SUVs increasing by 0.7% over the last year, though below the industry average seasonally adjusted price change of 2%. Also falling more than the industry average, trucks were down by just 0.3%, while mid-size sedans declined 0.6%, as compact cars fell the most, down 6.5% against last year. Major market segments were also mixed compared to the previous month, with mid-sized sedans showing the only gain month over month, higher by 0.2%. The luxury segment was down by 0.3%, pickups fell by 0.5%, and SUVs declined by 0.9%. The compact car segment fell the most and was down 2% against August.

Looking at the market by powertrain, electric vehicle values continue to show larger gains against last year than the market overall, as sales remained elevated over the quarter, with the impending expiration of tax credits driving higher levels of consumer demand. Robb noted, “Consumers kept the pace of new and used EV purchases high over the quarter, prior to the expiration of the tax incentive. This heightened demand pushed EV wholesale values higher again this month, making EVs the strongest-performing segment in year-over-year value appreciation.” EV values have shown higher year-over-year appreciation trends for six months in a row and were higher by 6.4% against the same month in 2024, while non-EVs rose by 1%. For September results against the prior month, EV values rose by 0.8% month over month, while non-EVs declined by 1%.

Retail used-vehicle sales were down in September. Assessing retail vehicle sales based on observed changes in units tracked by vAuto, initial estimates of retail used-vehicle sales in September were down 3.9% compared to August and down by 2% year over year. The average retail listing price for a used vehicle increased 1.5% over the last four weeks.  

Using estimates of retail used days’ supply based on vAuto data, an initial assessment indicates September ended at 46 days’ supply, up two days from 44 days at the end of August and up one day from September 2024 at 43 days.

New-vehicle sales in September increased 6.7% from last year, but volume decreased from August, dropping 14.2% but showing a continued strong pace of new-vehicle sales. The September sales pace, or seasonally adjusted annual rate (SAAR), came in at 16.4 million, up 600,000 from last year’s pace and even with the very strong 16.4 million level in August.

Combined sales into large rental, commercial, and government fleets rose again, up nearly 12% year over year in September, led by gains in the rental and government sectors. Including an estimate for fleet deliveries into dealer and manufacturer channels, the remaining retail sales were estimated to be up 6.8% from last year, leading to an estimated retail SAAR of 13.4 million, up slightly from 13.4 million last September but down from August’s estimated 13.7 million level. Fleet share in September was estimated to be 15.5%, unchanged from last year.

Rental risk price and mileage results are mixed against last September. The average price for rental risk units sold at auction in September increased 2% year over year. However, rental risk prices were down by 2.7% compared to August. Average mileage for rental risk units in September (at 47,100 miles) declined by 10.5% for the month against last year’s level and was also lower against the August comparison, falling by 4.5% over the month.

All Measures of consumer confidence declined in September. The Conference Board Consumer Confidence Index® decreased 3.7% in September and was worse than expected. Consumers’ views of both the present and the future declined, but the present situation declined the most. Consumer confidence was down 5% year over year. Plans to purchase a vehicle in the next six months decreased and was lower year over year. The sentiment index from the University of Michigan decreased 5.3% in September to 55.1, which was slightly lower than expected and marked a decrease from the earlier reading at the beginning of the month. The index was down 21.4% year over year. The underlying views of both current conditions and future expectations declined, with future expectations declining the most. Expectations for inflation in one year decreased to 4.7% from 4.8%, but expectations for inflation in five years increased to 3.7% from 3.5%. Consumers’ views of buying conditions for vehicles declined slightly to the lowest level in four months as views of prices deteriorated. The daily index of consumer sentiment from Morning Consult decreased 3.3% in September, resulting in a modest year-over-year increase of 0.4%. According to AAA, the national average price for unleaded gas decreased 3 cents in September from the end of August to $3.16 per gallon, which was down 1% year over year but up 3.2% year to date.