Wholesale Prices, Week Ending April 22nd
The Canadian used wholesale market saw a decline in prices for the week at -0.09%. The Car segment pulled ahead of Truck/SUV’s with Car prices increasing by (+0.3%) while Truck/SUVs’ segment prices declined (-0.2%). 8 out of 22 segments’ values have increased for the week. Compact Vans lead with +1.73% and Sub-Compact Cars follow behind at +0.27%. The segments with the largest declines were Compact Luxury Crossovers/SUV (-0.48%) and Full-Size Van (-0.37%).
|Last Week||2017-2019 Average (Same Week)|
|Truck & SUV segments||-0.20%||-0.14%||-0.27%|
- Overall car segments increased on average last week by +0.03%.
- There were six segments with a price increase. The Sub-Compact Car segment led the way at (+0.27%), with Sporty Car (+0.22%) and Mid-Size Car (+0.18%) following close behind.
- Three segments saw a decrease in prices. The largest decline being Full-Size Car at (-0.57%) followed by Prestige Luxury Cars (-0.07%).
- Overall truck segments decreased on average last week by -0.20%.
- Segments with the largest declines were Compact Luxury Crossover/SUV (-0.48%), Full-Size Van (-0.37%), Sub-Compact Crossover (-0.34%) and Sub-Compact Luxury Crossover (-0.30%).
- Two segments had increases. Compact Van (+1.73%) and Small Pickup (+0.01%).
Used Retail Prices & Listing Volumes
The average listing price for used vehicles was consistent week-over-week, as the 14-day moving average was at roughly $36,000. Analysis is based on approximately 170,000 vehicles listed for sale on Canadian dealer lots.
The Canadian market continued to decrease, and the overall decrease was slightly less than the historical average. Supply remains low with high demand for more recent and clean condition vehicles on both sides of the border. Upstream channels continue to tap supply before it can be available to wholesale markets. Many segments saw a change in average value of less than $50 this week as the market continues to stabilize.
Conversion rates were quite varied. Some observed sell rates were as high as 78% but most were in the 40-50% range. Last week we saw less sellers dropping floors, which has been contributing to lanes with lower sell rates.
Canadian Black Book’s Market Insights
Economics & Government
- The annual inflation rate in Canada fell to 4.3% in March of 2023, the lowest since August 2021, in line with market expectations and dropping from 5.2% in the previous month.
- Housing starts in Canada slipped by 11% over a month earlier to 213,865 units in March of 2023, undershooting market expectations of 227,800 units, according to the Canada Mortgage and Housing Corporation.
- Retail sales in Canada are expected to have fallen by 1.4% month-over-month in March of 2023, according to preliminary estimates. Considering February, retail sales dropped by 0.2% from a month earlier, revised lower from preliminary estimates of a 0.6% decrease and compared to the upwardly revised 1.6% jump in January.
- The Canadian dollar is around $0.739 this Monday morning showing a slight increase from $0.746 a week prior.
In the U.S., overall, Car and Truck segments increased +0.27% last week; the prior week increased by +0.31%.
Volume-weighted Car segments increased +0.37%, compared to the prior week’s increase of +0.41%:
- All nine Car segments increased last week.
- Sporty Car increased again last week, up +0.75%, marking the fourteenth consecutive week for an average weekly gain of +0.63%.
- Compact Car increased +0.52%, marking the eleventh consecutive week of increases. The segment has averaged a weekly increase of +0.55% over the past eleven weeks.
- Premium Sporty Car continued into positive territory for the second week in a row, with a gain of +0.03%.
Volume-weighted Truck segments increased by +0.22%; the previous week had an increase of +0.27%:
- Ten of the thirteen Truck segments reported increases last week.
- Compact Luxury Crossovers ended the segment’s eight weeks of consecutive increases with a small -0.02% decline.
- Minivans once again had the largest week-over-week gain at +0.62%, but this was the smallest single week increase for the segment in the last five weeks.
- Tesla is preparing to export the new version of its Model Y to North America from its factory in China for the first time, allowing for its most cost-efficient factory and largest market to be in closer contact; and now Tesla has advertised its Canadian offering of a new trim for the Model Y, a rear-wheel-drive version that would undercut the brands lowest priced SUV currently on sale by $10,000.
- With the largest auto investment in Canada also being supported by the Canadian Federal Government, $13 Billion in subsidies is scheduled to be paid to Volkswagen through a required level of output from the plant; this secures the possibility of $200 Billion of output should the automaker meet all their requirements. A fundamentally different deal than past contracts.
- Jaguar Land Rover will be rebranding itself, “JLR” as it creates a strategy around its nameplates of Range Rover, Discovery, Defender and Jaguar to become a “House of Brands” that will “amplify the uniqueness of our characterful British marques”, says Chief Creative Officer, Gerry McGovern.
- Toyota Motor Corp.’s newly appointed CEO, Koji Sato stated the organizations vision to “significantly enhance” productivity and profitability by the start of 2030, which will focus on the line of electric vehicles to help achieve lower price points and help drive production volume.
- Hyundai Canada pleaded guilty to 6 counts of criminal charges violating the Motor Vehicle Safety Act as it neglected to notify its owners of safety defects within the required 60-day time frame; the company will pay a fine of $360,000.
- Replacing the Encore subcompact SUV will be the 2024 Buick Envista, the brands final internal combustion nameplate before it shifts to an all-electric lineup later this year; the Envista will be available for pre-orders this summer.
- Polestar released the newest member of its all-electric lineup, the 4 last Tuesday at the Shanghai Auto Show, and it will be the first mass production vehicle without a rear windscreen which has been eliminated in favor of a rear-view camera and high-definition screen that delivers to the driver a real-time feed which the manufacturer says improves safety especially at night.
Market insights – 4/25/2023. Canadian Black Book. (2023, April 25). Retrieved May 4, 2023, from https://www.canadianblackbook.com/market-insights/market-insights-4-25-2023/