After small gains in September that halted a downward trend, used vehicle values got back on the drop, falling in October to the lowest point seen in almost a year.
Canadian Black Book’s Used Vehicle Retention Index for October sat at 158.5 points — a 1.1 per cent drop from the previous month and in line with numbers last seen in December 2021.
Having said that, year-over-year increases are still significant. Values in October this year are 13.7 per cent higher than last year.
Meanwhile, there are signs that annual value growth is starting to come back down. In January 2022, year-over-year growth was at 44.1 per cent. In June, the growth rate was at 28.9 per cent. Now it is just over 13 per cent.
Year-to-date, the index is down 3.6 index points compared to January. It started the year at 162.1 points and peaked in March at 165 points, the culmination of nearly two years of regular increase in value.
“The wholesale market is beginning its correction after two years of shocking increases,” said David Robins, principal automotive analyst and head of Canadian vehicle valuations at Canadian Black Book. “This won’t happen overnight, and likely will not return to pre-pandemic levels, however, we do expect the downward trend to continue.”
The index means used vehicles are valued at a rate of 58.5 per cent higher than the benchmark established by Canadian Black Book in 2005 when it introduced the index. The last time the index was near the benchmark was in the last summer of 2020 when it sat at 100.5 points.