Track Monitoring: All eyes on UAW strike intensification | Automatic remarketing Automatic remarketing
The UAW strike appears to be growing, so dealers are taking steps to shore up their used car inventory.
Black Book observed that the estimated average weekly sales rate increased to 51% during the closed week of Rosh Hashanah, with wholesale values continuing to decline by 0.73%.
Even as workers are no longer assembling new vehicles for General Motors, Ford and Stellantis at certain plants with more facilities expected to go out of business, Black Book noted in its latest edition of Market insights Still, these values fell much more last week than analysts typically saw during this part of the calendar in pre-pandemic times in 2017-2019.
During those weeks of those years, Black Book saw values fall by just 0.17% on average.
“Overall market declines continued to exceed traditional seasonality last week, but weekend auction activity increased as the UAW strike began,” BlackBook said. In her report. “The impact of the strike on the used car market will depend on the duration.
“In 2019, the last time there was a UAW strike, it was short in duration and the market already had a surplus of new inventory, so there was little impact on the values in use,” the analysts continued. “However, this time, supply levels were just returning to a ‘normal’ level after the pandemic, so an extended strike could see used prices rise in the short term.”
Looking more closely at the vehicle sectors, Black Book noted that overall vehicle values fell 0.59% on a volume-weighted basis last week. A week ago, the value of cars decreased by 0.89%.
As has been the trend for some time, new car prices have not fallen as much as old car prices. Prices for cars 0 to 2 years old fell 0.31%, while prices for cars 8 to 16 years old fell 0.67%, BlackBook said.
However, prices fell across all nine auto segments last week, according to Black Book tracking, with full-size cars leading the way with a 0.99% decline.
Analysts noted that full-size vehicle values have fallen an average of 1.24% weekly over the past six weeks.
After three consecutive weeks of increases, BlackBook noted that luxury sports car prices reversed and fell by 0.29%.
With fuel prices rising, analysts saw a “significant slowdown in last week’s decline” for small cars, which fell just 0.50%. Over the past six weeks, compact car prices have fallen by at least 1%, and half of those weeks have seen car prices fall by more than 2%.
Likewise, small car prices fell just 0.39% after six weeks of “significant” declines, according to Black Book.
In the truck space, volume-weighted data from Black Book showed an overall decline in the value of the truck sector by 0.79%.
Although newer trucks are still more expensive than cars, they have not dropped as much as prices for older trucks.
Black Book noted that values for 0- to 2-year-old trucks fell 0.53% last week, while prices for 8- to 16-year-old models fell 0.84%.
Prices in all 13 truck segments fell last week, with the subcompact luxury crossover segment down 1.26%, analysts said. The sector has now suffered seven straight weeks of declines exceeding 1%.
It’s also worth noting that Black Book reported that the decline in the value of full-size trucks accelerated last week, with values for those units falling 1.20%.
“In recent weeks, truck incentives have increased,” Black Book said. “But with the strike now officially underway, this is likely not a new trend for this segment.”
Whether it’s an independent agency of gravel for manufacturer executives, the entire auto industry seems to have at least one eye on the labor struggle.
“The beating is taking place at only three assembly plants currently, but this could increase at any time,” Black Book said. “There was a lot of talk on Friday at the auctions about how the strike would impact wholesale prices. We didn’t see much movement in values on Friday, but that was only the first day of the strike, and it may be a different story in the coming weeks. One thing we noticed is that Overall auction conversion rates increased again.
Blackbook went on to say: “As always, we have a team of analysts focused on keeping their eyes on the market, monitoring evolving trends and gathering insights.