The Manheim Used Vehicle Value Index (MUVVI) increased 8.6% in the first quarter, ending March at 238.1. The MUVVI has risen for four consecutive months after experiencing the largest decline within one year in the series' history in 2022.

 Wholesale used-vehicle prices (on a mix, mileage, and seasonally adjusted basis) increased 1.5% in March from February but are down 2.4% from March 2022. March's increase was moderated by the seasonal adjustment. The non-adjusted price change in March increased by 3.5% compared to February, moving the unadjusted average price down 2.9% year over year.

"For the first time in a long time, our midmonth Manheim Used Vehicle Value Index reading for the first half of March was actually way more positive than the final value," said Cox Automotive Chief Economist Jonathan Smoke. "Based on full-month data and other key metrics, we definitely think conditions are weakening. March came in like a lion and went out like a lamb regarding wholesale vehicle values. After four months of seasonally adjusted gains and 11 straight weeks of price increases, March was a turning point. So, April will likely continue the downward trend we saw as March ended, and we expect to see some negative monthly moves ahead for the index." 

Manheim Market Report Values See Increases 
In March, Manheim Market Report (MMR) values saw increases that were stronger than normal to start the month but below normal to end the month. Over the last four weeks, the Three-Year-Old Index increased an aggregate 1.6%. Over the month of March, daily MMR Retention, which is the average difference in price relative to the current MMR, averaged 99.8%, meaning market prices were slightly below MMR values. The average daily sales conversion rate increased to 65.4%, which was a normal average for the time of year. For context, the daily sales conversion rate averaged 65.3% in March 2019. However, the conversion rate declined as the month progressed, which indicates the month started with conditions favoring sellers but ended with conditions that were beginning to favor buyers.

Seven of eight major market segments continued to see seasonally adjusted wholesale used-vehicle prices that were lower year over year in March. Pickups showed a 0.6% increase. Compared to last March, midsize and compact cars lost less than the industry, at 1.4% and 2.2%, respectively, while luxury cars lost 8.0%, and the remaining three segments declined between 2.7% and 3.8%. Six of eight categories showed gains compared to February of between 0.5% and 2.1%. Vans were flat, and sports cars lost 1.6% versus last month.

Used Retail Vehicle Sales Decline in March 
Assessing retail vehicle sales based on observed changes in advertised units tracked by vAuto, we initially estimate that used retail sales increased 13% in March from February but failed to see the normal March lift. Used retail sales in March are estimated to be down 6% year over year.

Using estimates of used retail days' supply based on vAuto data, an initial assessment indicates March ended near 38 days' supply, down from 43 days at the end of February and nine days lower than how March 2022 ended at 47 days. Leveraging Manheim sales and inventory data, wholesale supply is estimated to have finished March at 22 days, down two days from the end of February and down one day from how March 2022 ended at 23 days. 

Rapid Growth: Sales of Used Electric Vehicles Increase by 32% in Q1 
Retail used electric vehicle sales – EVs sold through a licensed dealership – increased significantly in Q1, according to Cox Automotive data, up 32% year over year, to 42,753 units. (Sales volume estimates do not include private-party, consumer-to-consumer sales). While retail volume and share are still low, used EV sales in Q1 2023 represent twice the volume sold in Q1 2021.

According to data assembled by Cox Automotive, the market for used electric vehicles in the U.S. is beginning to accelerate rapidly as more used EVs become available and buyers snap them up. The rapid growth of new EV sales in the U.S. has been well documented; Cox Automotive is forecasting sales of new EVs in the U.S. will surpass 1 million units for the first time in 2023.

The volume of EV transactions at Manheim, the largest wholesale vehicle marketplace in the U.S., is also rapidly increasing. Through Q1, Manheim operating locations across the U.S. processed nearly 9,800 used EVs, an increase of 40% from the same period in 2022. Typically, with each EV, Manheim will inspect the vehicle, provide a condition report for the sale, and establish a value through the open auction process. Through March 2023, according to the Manheim index, wholesale values of used EVs have increased by 3.7% year over year, compared to the overall index decline of 2.4%.