The Expert Podcast

At car titles one of our clients is Manheim auto auctions They're the largest and most prestigious auto auction company in the country. And they process millions of vehicles every year on behalf of dealer consignments dealer sales. and almost every Licensed new and used car dealer Has some business relationship with Manheim They either buy cars there or sell cars there. and it's a very well-run operation but it's also a very good source Source Of information About The automarket. because That's Where you see I see What's What's happening in the car market before it happens. because every car that goes on a dealer's lot either comes from a trade in to that dealer which is a small percentage of their inventory Or it's purchased from Manheim. They have a largest auction chain in the country. So if you look at Manheim what's happening behind the scenes You'll know what where the car market's going. Well what does it say For present day. we see inflation We see interest rates going up Shouldn't that affect car prices Well apparently not. According to automotive news which is the largest industry trade publication Manhiem I'm Says whole sale used car prices ticked up Slightly. Slightly they're 10% higher. That's that's more than slightly. Year over year. And look 2021 was already a pretty big jump in price and it went up 10% more than that in may you could see the graph here. Right It didn't go up as much as it did from 20 to 21 but it still went up To 2022. after cooling a bit in the first half of the year Wholesale prices went up again. So there was a little bit of a pullback At the beginning of 22. It may have had to do with seasonality You know winter is not As big of a selling season And it may May have Have to With You know when interest rates go Go up And there's inflation And gas Prices people take a little bit of a pause but here's the thing People still need cars. And the new car market Is still not completely filled with inventory. Look at dealership Lots go by the Ford dealer the Toyota dealer the Honda dealer You see a lot of empty Asphalt. You don't see a lot of new cars So when the dealer doesn't have new cars to sell what do they do. They go to Manheim And purchase used car inventory For their lot because at least that way they have something to sell. And buyers when they go to a dealership If You have a nice Nice clean Late Model used car With good miles on it You're willing to buy it. Some of these used car sell for more Than what it did New. It's properly reconditioned Has good maintenance history. So Manheim Auto sales data Is an excellent source of what's going to happen with used car prices. Where shows right now is prices are solid. You're not seeing The Inventory values crash. You're not seeing Sales prices go down. New car available Availability It's still low. A dealership still needs to I have cars On their lot So that's where they're going They're getting them from Manheim. Now where does Manheim Get the cars. Well think about it this way
If you're a dealership and you sell let's say 30 cars in a month or 50 cars at a month And you take in 40 trade in vehicles. Not every one of those vehicles is going to be appropriate for your dealership. For example If you are a Ford dealership And somebody wants to trade in a Mercedes-Benz High-end luxury car. That That may not Not fit the inventory Suntory profile Profile Of Of your lot. By the same token If you're A Honda dealer and somebody trades in a big fight
the factory sells Cars on the lease at the end of the lease they take them back and those go to Manheim. So there are large volumes of inventory sources that go to these auctions And that's where these price data points come from monitoring the prices. And look this is all prices and not set by the auction It's not even set by the seller It's set by the buyer. buyers bid on these cars just like you would imagine There's an auction People raise their hand and they buy the car. And those prices are set by Who's willing to bid how much for the car And that Tells you What the Mood of the auto Industry is And what People are looking to buy. put your comments below let us know what you think So you on the next video.