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Black Book: Used-Vehicle Retention Index Remained Unchanged in July

August 01, 2017

LAWRENCEVILLE, Ga. — Black Book’s Used Vehicle Retention Index sat 113.0 in July, the same reading recorded in July. According to officials, the index has been unchanged or moved positive in three of the last four months.

The Black Book Used Vehicle Retention Index is calculated using the firm’s published wholesale average value on two- to six-year-old used vehicles, as a percent of original, typically-equipped MSRP. And in July, full-size cars, full-size pickups, luxury cars, and near-luxury cars all saw noticeable gains in their respective segment Indexes. Pickups remain popular because of the price of gas and overall supply in the market, while each of these car segments currently offer decent value, resulting from several months of sharp valuation declines over the last few years.

“What we’re experiencing over the last few months are signs of a resilient used-vehicle market, where the bottom is not dropping out as some had expected this year,” said Anil Goyal, senior vice president of automotive valuation and analytics for Black Book. “We’re paying close attention to several car segments, in particular, compact car and mid-size Car, which continue to weaken as demand remains soft and used supplies build.:

Anil added that the overall economy and credit availability conditions will influence the retention strength of those car categories moving forward.

The Index dates back to January 2005, when Black Book published a benchmark index value of 100.0 for the market. During 2008, the index dropped by 14.1%. However, in 2016, the index fell by just 6.4%. During 2011, the index rose strongly from 113.3 to 123.0 by the end of the year, as the economy picked up steam and used-vehicle values rose higher. It continued to remain relatively stable, rising slightly until May of 2014 when it peaked at 128.1.

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