Overpaying for Used, Fuel-Efficient Models a Possibility, KBB Warns
KBB says rising used-car values continue to fuel the rise in new-vehicle sales, but warns that dealers could be overpaying for fuel-efficient, used models in the months ahead.
IRVINE, Calif. — Kelley Blue Book reported yesterday that rising used-car values have fueled the increase in new-vehicle sales in recent months, especially for fuel-efficient models. The vehicle information site, however, warned dealers not to overpay on used, fuel-efficient vehicles.
“Values at auctions across the country increased nearly 2 percent in March, primarily led by strong gains in values of fuel-efficient vehicles, which have been in high demand from rising gas prices,” said Alec Gutierrez, senior market analyst of automotive insights for Kelley Blue Book. “Seasonal influences also played a role in the market’s strength. March traditionally is one of the strongest months of the year for both new- and used-car sales, and this year was no exception.”
Strong sales coupled with a limited supply of used vehicles at auction only put further upward pressure on values. Many one- and two-year-old used, fuel-efficient vehicles are so expensive today that a comparable new vehicle may only be marginally more expensive.
“Consumers have more options than ever before when it comes to fuel-efficient offerings, and many of these vehicles can be leased for less than $200 per month and a small down payment,” said Gutierrez. “Dealers must keep this in mind as they continue to pay more and more for used compacts at auction. As values rise, dealers will find it difficult to pass along the premium paid at auction to consumers.”
Dealers should be especially wary of overpaying on used fuel-efficient vehicles in the months ahead, KBB warned. With so many new and redesigned subcompact and compact offerings available today, consumers will have little reason to pay close to sticker for a one- or two-year-old used vehicle.
Fuel Sippers Surge in March | ||||
KBB Auction Value | Change | |||
Segment | Mar 1st | Mar 30th | $ | % |
$16,974 | $18,721 | $1,748 | 10.3% | |
$12,286 | $13,022 | $735 | 6.0% | |
$11,071 | $11,646 | $575 | 5.2% | |
$20,011 | $20,837 | $826 | 4.1% | |
$13,980 | $14,514 | $534 | 3.8% | |
Average | $18,113 | $18,441 | $328 | 1.8% |
$20,112 | $20,430 | $319 | 1.6% | |
$31,103 | $31,494 | $391 | 1.3% | |
$24,842 | $25,132 | $290 | 1.2% | |
$17,296 | $17,483 | $187 | 1.1% | |
$37,627 | $37,380 | ($247) | -0.7% | |
Premium Sports Car | $42,204 | $41,420 | ($784) | -1.9% |
Segments listed include 1 to 3-year-old vehicles (MY2009-2011) | ||||
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