vehicle market insights · 2 days ago · 33 manheim market report (mmr) vehicle insights source:...

Vehicle Market InsightsManheim Used Vehicle Value Index Call - July 8, 2020

J o n a t h a n S m o k e & Z o R a h i m

S p e c i a l G u e s t : W h i t n e y G e r k i n

1

INVENTORY

RETAIL

FINANCIAL

MOBILITY

COVID-19 Market Update

4

Covid-19 Local Impact Assessment

Source: Cox Automotive

5

Continuing Claims At 19.3 Million Nationally

Source: U.S. Department of Labor

6

114.23

113.8

81.23

86.81

60

70

80

90

100

110

120

ICS Value (7-Day Average)

Consumer Sentiment Moves Down Again

Source: Morning Consult

Morning Consult’s Index of Consumer Sentiment on Monday was down 23.4% since February 29

7

New Vehicle Sales Down But Recovering

Source: BEA

-50%

-40%

-30%

-20%

-10%

0%

10%

20%

30%

40%

Jan

-06

Jun

-06

No

v-06

Ap

r-0

7

Sep

-07

Feb

-08

Jul-

08

Dec

-08

May

-09

Oct

-09

Mar

-10

Au

g-1

0

Jan

-11

Jun

-11

No

v-11

Ap

r-1

2

Sep

-12

Feb

-13

Jul-

13

Dec

-13

May

-14

Oct

-14

Mar

-15

Au

g-1

5

Jan

-16

Jun

-16

No

v-16

Ap

r-1

7

Sep

-17

Feb

-18

Jul-

18

Dec

-18

May

-19

Oct

-19

Mar

-20

Total New % Change y/y

8

New Vehicle Market Share Performance – 1H 2020


0.02

0.05

0.06

0.07

0.12

0.12

0.14

0.17

0.17

0.22

0.28

0.29

0.36

0.47

0.59

0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70

LAND ROVER

LEXUS

VOLKSWAGEN

VOLVO

SUBARU

LINCOLN

GMC

TOYOTA

JEEP

RAM

TESLA

HYUNDAI

MAZDA

KIA

CHEVROLET

0.00

-0.01

-0.01

-0.02

-0.02

-0.02

-0.05

-0.07

-0.08

-0.10

-0.10

-0.19

-0.19

-0.65

-1.65

-2.00 -1.50 -1.00 -0.50 0.00

ACURA

HONDA

JAGUAR

FORD

AUDI

FIAT

MINI

CADILLAC

CHRYSLER

INFINITI

MITSUBISHI

BMW

BUICK

DODGE

NISSAN

9

New Vehicle Market Share Performance – 1H 2020


0.00

0.01

0.03

0.07

0.17

0.22

0.68

1.12

1.36

2.41

0.00 0.50 1.00 1.50 2.00 2.50 3.00

Electric Vehicle

High-end Luxury Car

Luxury Full-size SUV/Crossover

Compact SUV/Crossover

Luxury Mid-size SUV/Crossover

Luxury Compact SUV/Crossover

Mid-size Pickup Truck

Subcompact SUV/Crossover

Mid-size SUV/Crossover

Full-size Pickup Truck

-0.20

-0.24

-0.27

-0.30

-0.44

-0.53

-0.62

-0.80

-0.82

-1.83

-2.20 -1.70 -1.20 -0.70 -0.20 0.30

Hybrid/Alternative Energy Car

Full-size SUV/Crossover

Entry-level Luxury Car

Van

Luxury Car

Full-size Car

Minivan

Subcompact Car

Mid-size Car

Compact Car

10

Retail Sales Recovery Estimates


-70.0%

-60.0%

-50.0%

-40.0%

-30.0%

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

1/6

1/1

0

1/1

4

1/1

8

1/2

2

1/2

6

1/3

0

2/3

2/7

2/1

1

2/1

5

2/1

9

2/2

3

2/2

7

3/2

3/6

3/1

0

3/1

4

3/1

8

3/2

2

3/2

6

3/3

0

4/3

4/7

4/1

1

4/1

5

4/1

9

4/2

3

4/2

7

5/1

5/5

5/9

5/1

3

5/1

7

5/2

1

5/2

5

5/2

9

6/2

6/6

6/1

0

6/1

4

6/1

8

6/2

2

6/2

6

6/3

0

7/4

Y/Y % Change in 7-Day Moving Average of Retail Sales

New Used

Update: Manheim’s Shift to All-Digital

Whitney Gerkin

Digital Marketplace Director

Manheim

12

ACCESSING MANHEIM INVENTORY TODAY

MANHEIM.COM OVE / PRIVATE STORES MANHEIM EXPRESS

SIMULCAST DIGITAL BLOCKS

(In-Lane Bidding)

13

OPERATIONAL UPDATES SINCE GOING ALL-DIGITAL

Welcomed sellers back on

the block at all locations.

Welcomed buyers to

preview vehicles on the

lot at all locations.

Piloting in-lane bidding

"Digital Blocks" at select

locations.

14

DIGITAL WHOLESALE IS STRONG

Manheim’s sales rates are now higher than

pre-COVID levels.

January through June, Manheim experienced

1.5+ million digital transactions, which is more

than 20% higher than the same period in 2019.

OVE sales were up nearly 70 percent in June

compared to last year.

Source: Manheim Data

15

23,000SIMULCAST SALES

OCCURRED ON A

SINGLE DAY IN JUNE,

A RECORD ON THE

PLATFORM

~40%IS THE INCREASE IN

USAGE OF SIMULCAST

REMOTE SELLER SINCE

MARCH 16

8200+VEHICLES SOLD IN A

WEEK AT MANHEIM PA

IN JUNE, 900 HIGHER

THAN SAME WEEK

2019

6 in 10DEALERS SAY THAT

SIMULCAST IS

WORKING AS A

REPLACEMENTBUYERS MADE FIRST

TIME PURCHASES ON

SIMULCAST

8300+

STATS: MANHEIM DIGITAL MARKETPLACE

MANHEIM DIGITAL COVID-19 SNAPSHOT

16

SIMULCAST ATTENDANCE & BIDDING ARE ON THE RISE

Source: Manheim Data

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

0

50

100

150

200

250

300

350

400

Simulcast Attendance & Bidding in 2020

Attendees Per Lane Bids Per Unique Offer

Att

en

dees P

er

Lan

eB

ids P

er U

niq

ue O

ffer

“The system is really easy and I

really enjoy it. I'll be honest. I was

one of the biggest skeptics

against it because I really

hadn't tried it and I couldn't get

over the idea of bidding online.

But since I've done it the last few

weeks I do like it. The more I use

it, the more I like it.”

-Manheim Dealer Client

• Wholesale will remain heavily digital for the

foreseeable future.

New vehicle tracking technologies will make

it easier to locate and preview inventory.

We’re going all-in on vehicle imaging.

In-lane bidding is contingent on safety first.

WHAT’S NEXT FOR WHOLESALE?

Manheim Used Vehicle Value Index

All Manheim U.S. sales

Classify by market segment

Account for differences in mileage

Weight to provide smoother segment mix

Seasonally adjust

19

Steps:

A single measure of used vehicle price

change that is independent of underlying

segment shifts in the characteristics of

vehicles being sold

Concept:

20

Record-Setting Rebound In Wholesale Prices

Source: Manheim/Cox Automotive

149.3

90

95

100

105

110

115

120

125

130

135

140

145

150

155

Jan-95 Jan-98 Jan-01 Jan-04 Jan-07 Jan-10 Jan-13 Jan-16 Jan-19

January 1995 = 100

Prices in June increased 8.95% from May 2020 and were up 6.3% compared to June 2019

21

Used Vehicle Values Back to Pre-Covid Strength

Year-over-year price performance stronger than average

6.3%

-15%

-10%

-5%

0%

5%

10%

15%

20%

25%



22

Manheim Index versus Mix & Quality Adjusted New Vehicle Price with 3 ½ year Lag

Used vehicle prices back above the historical new vehicle price relationship trend

30%

35%

40%

45%

50%

55%

60%

Jan-95 Jan-97 Jan-99 Jan-01 Jan-03 Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 Jan-15 Jan-17 Jan-19

Source: Bureau of Labor Statistics, Manheim/Cox Automotive

23

Wholesale Used Vehicle Prices vs. New Vehicle Prices


$25,000

$27,000

$29,000

$31,000

$33,000

$35,000

$37,000

$39,000

$41,000

$9,500

$10,500

$11,500

$12,500

$13,500

$14,500

$15,500


Manheim Non-Adjusted Price (LHS) Average new vehicle transaction price per KBB (RHS)

24

2020 Weekly Price Trend More Than Recovered

2020 spring bounce ended abruptly as COVID-19 pandemic hit the US but prices more than recovered in weeks

since


80.0%

85.0%

90.0%

95.0%

100.0%

105.0%

110.0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52

3-Year-Old Model MMR Index by Week

2014-2016 2017 2018 2019 2020

25

Retention Values Ended June Up 1.9% Relative to 2019

Relative to MSRP and fixing the basket of vehicles by what was sold leaves residuals following similar pattern

Source: Kelley Blue Book/Cox Automotive

(1 to 3 year-old models)

45%

47%

49%

51%

53%

55%

57%

59%

61%

63%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

CY 2018 CY 2019 CY 2020

26

Percent Change in Wholesale Prices for Major Market Segments

Most major segments saw year-over-year gains in June


6.3%

4.0%

1.8%

9.7%

5.9%

4.6%

-3.5%

-8%

-3%

2%

7%

12%

17%

22%

Industry Compact cars Midsize cars Luxury cars Pickups SUV/CUV Vans

1 year

2 years

3 years

4 years

27

Average Auction Price – Rental Risk Units

Average price for rental risk units sold in June up 3.4% y/y and up 8.9% m/m


13,000

13,500

14,000

14,500

15,000

15,500

16,000

16,500

17,000

1 2 3 4 5 6 7 8 9 10 11 12

2016

2017

2018

2019

2020

28

Distribution of Rental Risk Vehicles


2018 Q2 2019 Q2 2020 Q2

Number of unique

year, make, model,

body configurations

sold

3,023 3,337 3,090

Share accounted for

top 10 YMMB 13.5% 12.0% 14.0%

Share accounted for

top 25 YMMB 22.9% 22.3% 25.9%

Number of YMMB to

reach 50% share 109 106 86

29

Average Mileage – Rental Risk Units Sold at Auction

Average mileage for rental risk units in June was down 7% compared to a year ago and down 6% m/m


43,473

20,000

25,000

30,000

35,000

40,000

45,000

50,000

55,000

60,000


30

Rental Risk Units Sold by Condition


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2015 Q4 2016 Q2 2016 Q4 2017 Q2 2017 Q4 2018 Q2 2018 Q4 2019 Q2 2019 Q4 2020 Q2

5.0

4.0 - 4.9

3.0 - 3.9

2.0 - 2.9

0 - 1.9

31

Rental Risk Units Sold by Make


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2015Q4

2016Q1

2016Q2

2016Q3

2016Q4

2017Q1

2017Q2

2017Q3

2017Q4

2018Q1

2018Q2

2018Q3

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

2020Q1

2020Q2

All other

Mazda

Kia

Jeep

VW

Chrysler

Hyundai

Dodge

Toyota

Nissan

Ford

Chevrolet

32

Rental Risk Units Sold by Segment


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

2015Q4

2016Q1

2016Q2

2016Q3

2016Q4

2017Q1

2017Q2

2017Q3

2017Q4

2018Q1

2018Q2

2018Q3

2018Q4

2019Q1

2019Q2

2019Q3

2019Q4

2020Q1

2020Q2

Van

SUV

Sports Car

Pickup

Luxury Car

Midsize Car

Compact Car

33

Manheim Market Report (MMR) Vehicle Insights


All top selling vehicles in June at Manheim saw higher prices over the last 30 days (June 1 – July 1). Prices year-

over-year saw mostly lower than normal depreciation, but a few vehicles sold for more than year-ago prices.

Rank Source(Rank) Category Subcategory Vehicle 1-Jul Past 30 Days Last Year Current Dep L12M Dep/Mo

1 All SUV SUV Midsize 2017 NISSAN ROGUE AWD 4D SUV 2.5L SV $15,800 $15,550 $16,000 1.6% -0.1%2 All Compact Car Compact Car Premium 2017 HYUNDAI ELANTRA 4D SEDAN SE $9,925 $9,750 $10,700 1.8% -0.6%

3 All SUV SUV Entry 2017 FORD ESCAPE FWD 4D SUV 1.5L SE $13,450 $13,250 $13,950 1.5% -0.3%

4 All Compact Car Compact Car Premium 2017 NISSAN SENTRA 4D SEDAN SV $9,875 $9,675 $10,400 2.1% -0.4%5 All Pickup Pickup Heavy Duty Full 2019 RAM 2500 4WD V8 CREW CAB 6.4L BIG HORN $38,500 $37,800 $36,800 1.9% 0.4%

1 Dealer Dealer Midsize Car Midsize Car Premium 2014 VOLKSWAGEN PASSAT 4C TDSL 4D SEDAN TDI SE $9,600 $9,425 $9,525 1.9% 0.1%

1 Lease Lease SUV SUV Midsize 2017 NISSAN ROGUE AWD 4D SUV 2.5L SV $15,800 $15,550 $16,000 1.6% -0.1%

1 Rental Rental Midsize Car Midsize Car Entry 2018 CHEVROLET MALIBU 4D SEDAN LT $12,950 $12,650 $13,900 2.4% -0.6%

34

Sales Impact Varies by DMA As Evidenced By Unique Credit Apps


April 5th July 5th

Appendix

35

36

Weekly Price Trend Similar For Non-Luxury

Slightly stronger declines followed by stronger recovery


80.0%

85.0%

90.0%

95.0%

100.0%

105.0%

110.0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52

Non-Luxury 3-Year-Old Model MMR Index by Week

2014-2016 2017 2018 2019 2020

37

Weekly Price Trend Less Severe For Luxury

Luxury vehicles have outperformed by not declining as much and now seeing similar strength


80.0%

85.0%

90.0%

95.0%

100.0%

105.0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52

Luxury 3-Year-Old Model MMR Index by Week

2014-2016 2017 2018 2019 2020

38

Weekly Price Trend Now Strong for One-Year-Old Vehicles

One-year-old vehicle prices were very stable throughout most of 2019 but had a rough March and April


80.0%

85.0%

90.0%

95.0%

100.0%

105.0%

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52

1-Year-Old Model MMR Index by Week

2014-2016 2017 2018 2019 2020

39

Luxury Prices Move Higher Than Non-Luxury In June


Luxury prices in June were up 7% compared to June 2019, while non-luxury prices increased 6%

January 2000 = 100

124.4

146.2

80

90

100

110

120

130

140

150

Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-12 Jan-14 Jan-16 Jan-18 Jan-20

Luxury Non-Luxury

40

107.5

0

20

40

60

80

100

120

140

Jan-15 Jan-16 Jan-17 Jan-18 Jan-19 Jan-20

Electric Car

Electric Car Prices Improve In June


Electric car prices in June were up 5% compared to June 2019

January 2015 = 100

41

Rise of SUV Not Yet Fully Reflected in Wholesale Market

The SUV reigns supreme in new vehicle sales while cars still dominated the used car market


44%

12%

39%

5%

0%

10%

20%

30%

40%

50%

60%

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Manheim Sales by Category

CAR PICKUP SUV VAN

25%

20%

50%

5%0%

10%

20%

30%

40%

50%

60%

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

New Vehicle Sales by Category

CAR PICKUP SUV VAN

42

Thank You

Jonathan Smoke & Zo RahimEconomic Industry Insights

[email protected]

[email protected]

@SmokeonCars

@autosanalyst

vehicle market insights · 2 days ago · 33 manheim market report (mmr) vehicle insights source:...

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