CBB Weekly Automotive Market Update 6/29/2021

June 29 2021
CBB

Wholesale Prices, Week Ending June 25th

As Covid-19 restrictions ease and cottage season begins, the Canadian used vehicle wholesale market remained somewhat flat for the week, with an overall increase of just +0.05%. Full-Size Vans saw the largest percent increase with +0.62%, while the Premium Sporty Segment (+0.42%) continued to outperform the overall car segment (+0.04%). Truck/SUV segments remained steady this week, with prices increasing +0.06%, reversing from prior week’s modest decline.

  This Week Last Week 2017-2019
Average (Same Week)
Car
segments
+0.04% +0.26% -0.14%
Truck
& SUV segments
+0.06% -0.10% -0.24%
Market +0.05% +0.08% -0.19%

Car Segments

• Overall, used cars prices remained relatively flat with a weekly change of +0.04% - slightly weaker compared to last week’s increase of +0.26%.
• Premium Sporty Car saw weekly prices increase by +0.42% followed by Luxury Car segment at +0.37%, the only 2 car segments to record a positive price development for the week.
• 7 of the 9 Car segments showed slight price decreases, Full-Size Car was down -0.61%, followed by Sub-Compact Cars and Compact Cars down -0.45% and -0.34%, respectfully.

Truck Segments

• Overall, Truck segment weekly values increased +0.06%, rebounding from the prior week’s modest decline.
• Commercial use vehicles saw prices increase, with Full-Size Vans up +0.63% and Compact Vans up +0.29%; additionally, Small Pickups increased +0.35% and Full-Size Pickups were up +0.17% for the week.
• Personal use vehicles saw prices steady versus last week; Sub-Compact Luxury Crossovers saw the largest price decline (-0.41%), followed by Sub-Compact Crossovers (-0.21%).

Used Retail Prices & Listing Volumes

The average listing price for a Used vehicle continued to rise this past week as the 14-day moving average now sit around the ~$26,800 and the 28-day moving average at ~$26,700. Analysis is based on approximately 140,000 vehicles listed for sale on Canadian dealer lots.
The 14-day moving average for Active listing volume fell slightly to ~139,500. Active listing volume began showing positive movement in early April and we are now seeing listing volume stabilize around 140,000 units.

Volume

Used Retail

Listing volume continue to fall in comparison to the previous week, with the CBB Listing Volume Index at 1.088. The index continues to show that overall listing volume is at higher levels than this time last year.

Wholesale

The Canadian wholesale market has leveled off with only a slight modest increase this week. Supply remains low with high demand on both sides of the boarder. Upstream channels continue to tap supply before it can be available to wholesale markets. Conversion rates were inconsistent this week. Some observed sell rates were as high as 79% while others were as low as 29% this week. We are seeing more sellers setting floors higher than the current market will bear, which has been contributing to lower sell rates. Quality of vehicles at auction remains somewhat below average as the supply of better-quality vehicles continues to be bought upstream.
The U.S. market exchange rate was similar to the previous week and remains favorable for exportation when price and demand are taken into consideration. Arbitrage opportunities have continued to bring US buyers, causing a steady flow of vehicles south across the border.

Canadian Black Book’s Market Insights

Economics & Government

• The Canadian dollar value continues to remain in the $0.81 range this past week, as oil prices dip.
• Ontario began phase 2 of reopening earlier than originally expected, as the number of cases drop and rate of vaccinations increase.
• Inflation will likely remain near the top of our 1-3 % inflation-control target range through the summer. This largely reflects base-year effects combined with much stronger gasoline prices.

U.S. Market

All U.S. Car and Truck segments reported increases this past week with the overall market gaining +0.35%, which is half of last week’s +0.70%.
• The Car segment gains of +0.17% are lower than the week prior’s +0.75%:
• No segments increased more than +1.00% this week for the first time in 20 weeks.
• Full-size Cars had the highest gain for the week at +0.53%.
• The Compact car segment was the only car-segment to decrease (-0.16%).

• The Truck segment gains were +0.44%, lower than last week’s +0.68%:
• No segments increased more than +1.00% this week for the first time in 19 weeks.
• The Compact Van segment had the highest gains for the week at +0.94%.
• The Small Pickup segment was the only truck segment to decrease (-0.41%).

Industry News

• Honda is developing a battery-electric crossover, Prologue, with General Motors that is expected to go on sale in early 2024.
• Audi plans to only release new battery-electric models starting in 2026, gradually phasing out internal combustion engines until 2033.
• Tesla recalls almost every car it has sold in China - the Chinese government says Autopilot can be engaged automatically.