Cox Automotive Australia (CAA) has released its used vehicle insights report for the first half of 2024.
The report says dealership used car sales are up 8.4% year-to-date while average selling prices declined 7.8% across the previous 12 months to their lowest point in more than three years.
CAA says this can be partly attributed to improved new and used vehicle supply.
It says the number of vehicles in dealer-used inventories expanded by 10.5% between June 2023 and June 2024.
Dealership used vehicle sales:
The first half of 2024 ended strongly, with June recording the highest month of dealer-used deliveries since November 2020.
Sales of passenger cars (sedans, hatchbacks, wagons, coupes and MPVs) grew by 5.1% YoY, and ute sales rose by 6.4%. However, SUVs did the heavy lifting in growth, up 16.1% by volume.
SUVs accounted for 47.6% of the dealer-used market, traditional passenger cars 31.9%, and light commercials 20.2%.
Electric and plug-in hybrid vehicles accounted for just 0.3% of used sales by dealers over H1. However, volumes were up 90.3% over H1 of 2023, suggesting an uptick in demand.
The top five used vehicles sold by dealers were the Ford Ranger (11,728 sales YTD, up 19.4%), Toyota Hilux (8473, up 0.5%), Toyota Corolla (8242, up a healthy 45.6%), Toyota RAV4 (6540, up 28.3%), and Hyundai i30 (5850, up 5.7%).
A useful metric to gauge demand is Average Selling Days. Used dealers, on average, took 37 days to sell passenger cars, 40 days to sell SUVs, and 41 days to sell utes. The selling days average for EVs was 48 days.
Dealership used vehicle pricing:
The Cox Automotive Australia Dealer Delisted Price Index tracks movements in used car selling prices over time, commencing at 100 points in December 2019.
The CAA Index was 131.8 at the end of June 2024, denoting a market-wide average selling price on used cars that was 31.8% higher than before the COVID period, including CPI.
This figure is down 7.8% from the Index’s end of H1 2023 and 11.0% from the market’s peak of 148.1, which hit in August 2022, when shortages were most pronounced.
38.8% of all sold used vehicles had a price change (discount) between listing and sale, an average of 7.1% per vehicle.
Breaking down Price Indexes by vehicle segment and age reveals some notable patterns:
Namely, passenger vehicle prices are the most inflated compared to pre-COVID levels (141.8) and SUVs the least (124.4).
The steep increase in new passenger car prices is creating space for used models to stay elevated on the Price Index, and their declining sales in the new market are limiting the supply of quality used passenger cars, inflating the prices dealers can sell them for.
A clear pattern also shows that older vehicles are more expensive than pre-COVID, driven by high demand for older and cheaper cars amid the cost-of-living squeeze.
For example, used passenger cars and SUVs aged 2-4 have Price Indexes of 127.3 and 119.5, respectively, whereas those aged 8-10 have Indexes of 158.2 and 129.1, respectively.
Another way to map the drop in accurate used vehicle prices since the market peaked two years ago is to track average resale values (RV%) across age brackets and segments.
We observe that conventional passenger cars aged 2-4 years on average sold for 81.9% of their original price in June, compared to 91.6% back in June 2022.
SUVs aged 2-4 had an average disposal RV of 80.3% in June 2024 compared to 92.9% in June 2022, and Utes aged 2-4 declined from 102.0% to 84.4% over the past two years.
These RV% figures are based on age, and apparent discrepancies depend on the make, model, and kilometres travelled, so take them with a pinch of salt.
Used vehicle supply for dealerships:
The used vehicle inventory tracked in the CAA database is 10.5% higher now than last year, though available used stock declined 2.1% between May and June 2024.
For context, the number of used vehicles in its dealer database is now about 30% greater than at the height of shortages in 2022.
The vehicles in the healthiest supply were the Ford Ranger (4052) and the Toyota Hilux (2528).
CAA measure the balance between supply and demand using a metric called Market Days’ Supply, with 70 days being the retail benchmark. The MDS is 63 days from 61 at the half-yearly point of 2023.
Some 47.5% of listed used vehicles are SUVs, 30.8% are passenger cars, and 21.2% are light commercials. Just 0.5% of listings are EVs or PHEVs. However, stock levels climbed 56.3% year over year, pointing to improved availability.
More on used EVs
The availability of second-hand EVs and PHEVs under two years expanded 48.4% YoY, whereas the stock of used EVs aged 2-4 years nearly tripled YoY (up 291.2%).
The average delisted price of a lightly used EV or PHEV aged under two across H1 declined from $70,994 in June 2023 to $53,058 in June 2024, down 25.3%, driven by the influx of affordable Chinese EVs and Tesla’s ongoing price cuts.
To that end, the average RV% of used EVs and PHEVs aged 2-4 years fell to 61.3% in June 2024, down from the 70.9% average just 12 months ago.
While EVs still have the longest average selling days – between 46 days and 53 days, depending on age and stage – and the worst average RV%, it’s essential to add the caveat that the sample size of available data is small and, therefore, prone to volatility.
