CBB Index Declines for December Following Trend Since Q2 of 2022
First Year-Over-Year Decline since Summer 2020
Canadian Black Book released its Used Vehicle Retention Index for December 2022, which declined slightly. The Index is at 157.6 points, which is a –0.7% decrease month-over-month and a –0.6% decrease year-over-year.
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Year-over-year, from December of 2021, the Index is down 0.6%. This is the first year-over-year decrease since July of 2020, when wholesale vehicle values in Canada began a historic climb. 2022 began the year with a 44% rise in values compared to January 2021. That rate slowly declined all year until December to end the year off with negative growth over the same month last year.
“Increasing interest rates and slowly improving new vehicle supply has had a cooling effect on the wholesale market but the overall lack of used supply has offset much of those pressures.” says David Robins, Principal Automotive Analyst and Head of Canadian Vehicle Valuations at Canadian Black Book.
The Index peaked in March of 2022 at 165 Index points, and it now sits –4.5% under that level. Preceding the March peak was a run of unprecedented growth in used values beginning in the late summer of 2020, when the Index was as low as 100.5 points.
Month-over-month, 10 segments saw growth, while 12 segments declined in value. Sub-Compact Car lead the way with a 1.59% jump over November, with Prestige Luxury Car at 1.44%, and Compact Van at 0.70%. The loss leaders were Sporty Car losing –6.11% in the month, Premium Sporty Car at -2.82%, and Full-Size Pickup with a decline of –2.65%.
Sporty Car also saw the largest year-over-year decrease at 13.93%. The highest year-over-year increase was Sub-Compact Car at 19.45%.
The Canadian Black Book Used Vehicle Retention Index is calculated using CBB’s published Wholesale Average value on two to six-year-old used vehicles, as a percent of original typically equipped MSRP. It is weighted based on registration volume and adjusted for seasonality, vehicle age, mileage, and condition. The Index offers an accurate, representative, and unbiased view of the strength of today’s used vehicle market values. The Index dates to January 2005, where the Canadian Black Book published a benchmark index value of 100.0 for the market.
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