AVERAGE used-car prices continued their slide during the third quarter with Cox Automotive Australia reporting that the dealer delisted price index has slipped back to levels last seen in early 2021.

However, Cox Automotive Australia’s third-quarter report shows a mixed bag with little correlation between vehicle types and ages.

It shows passenger cars – sedans and hatchbacks – are holding prices better than SUVs and that older stock is fetching higher prices than younger vehicles.

With that in the background, the main picture shows dealer used inventory is up 5.6 per cent compared with the same period in 2023, while sales are up 9.7 per cent. Sales in Q3 2024 are also up on Q2 2024 by 6.1 per cent. On a YTD basis, sales of used EVs and PHEV are up exactly 100 per cent while used SUVs sales are up 14.5 per cent, used ute sales are up 9.9 per cent and used passenger cars are up 3.3 per cent. 

Cox Automotive Australia said this was linked more to shortages of  supply rather than tapering demand, as reflected in their shorter-than-average selling time of 39 days per unit. 

Cox said that this was becoming a familiar pattern with the selling prices of older used vehicles remaining more elevated over pre-2020 levels than those for younger vehicles. 

“Moreover, traditional passenger hatchbacks and sedans remain more elevated than SUVs, which are in greater supply,” it said in its Q3 report. 

The Cox Dealer Delisted Price Index sits at 129.6 which means an average 29.6 per cent price increase on all dealer-listed vehicles since the base period of December 2019. This figure is volume-weighted and adjusted by MSRP. 

Cox said that this is the lowest the Index has been in more than 3.5 years, down 6.6 per cent compared with the same time last year, and 12.5 per cent down since the market peaked in August 2022. 

The latest Cox data also shows that 41 per cent of all used cars sold by Australian dealers in the Cox database (as of September) are receiving one or more discounts while listed for sale, by an average  of 7.1 per cent per vehicle. The cumulative YTD figure is 39.6 per cent, suggesting an uptick lately. 

But the report shows that the weakening prices are not across the board when comparing relative changes in prices and residual values across both age brackets and vehicle types. 

“Total used vehicles aged under two years have a current price index of 106.5, meaning a 6.5 per cent  increase in selling prices since December 2019,” it said.“This compares to a current Index of 117.5 for vehicles aged 2-4 years, 127.1 for those aged 5-7 years, and 140.1 for those aged 8-10 years.” 

Cox said that this is driven by high demand for older cars because of current economic conditions – headlined by the cost-of-living – and greater supply of new cars which is suppressing the value of late-model vehicles.

The changes also affect the prices o.f different vehicle types. The price index for traditional passenger cars (sedans and hatchbacks) is 144.6, meaning  a 44.6 per cent increase since the December 2019 base period. 

By contrast, the price indexes for other vehicle types are lower: 121.2 (up 21.2 per cent) for SUVs, 127.2 (up 27.2) for utes, 127.9 (up 27.9) for vans, and 112.9 (up 12.9) for EVs and PHEVs. 

Average selling prices for passenger vehicles of all ages are down 3.8 per cent across the past 12 months compared to a 7.0 per cent fall for SUVs, a 9.4 per cent reduction for utes, an 8.3 per cent fall for vans,  and a 2.3 reduction for EVs and PHEVs (note: small sample size).

Residual values also show the breadth of the price changes. Comparing average selling residual values (RV%), defined as what the used selling price was as a percentage of the vehicle’s RRP when new, used vehicles aged 2-4 years have a current expected RV% overall of 78.3, down from 91.9 per cent two years ago when vehicle shortages were inflating prices across the used market. 

“RV% has also decreased on those cars aged 5-7 years from 73.6 two years ago, to 64.6 as of September 2024,” the report said. 

Cox said that the used vehicle inventory in dealers within its data is up 5.6 per cent compared with the same period in 2023, showing there are now more vehicles available.

Despite this, supply of used passenger cars (sedans, hatchbacks, wagons) is down 0.9 per cent on last year which is tied to the steady decrease in sales for these types of vehicles in the new market across the past  decade. 

“This is a key driver of why passenger cars have more inflated price Indexes,” the Cox report said.

Year-on-year inventory of used SUVs in dealers is up 6.3 per cent, used ute stocks are up a robust 11.7 per cent, used van inventory has grown 28.5 per cent, and supply of used EVs and PHEVs is up 36.3 per cent.

The total used-vehicle inventory in dealers at September 30 was made up of 30 per cent SUVs; 30.6 per cent passenger cars; 21.2 per cent light commercials; and 0.5 per cent EVs and PHEVs.

The most listed models in the four age brackets (under two years; 2-4 years; 5-7 years; and older than 8 years) were the Ford Ranger (in all but the 2-4 year age group where the Toyota RAV4 was higher).

The Ranger was also the top-selling dealer used vehicle, up 25.9 per cent YTD, followed by the Toyota Hilux (up 5.5 per cent); Toyota Corolla (up 36.9 per cent); Toyota RAV4 (up 29.6 per cent); and Hyundai i30, up 1.0 per cent.

Cox said that of particular interest to retailers was that sales of the Toyota Corolla and RAV4 are particularly up YoY, with  sales of Corollas aged 2-4 years up 72.4 per cent and RAV4s aged 2.4 years up 46.8 per cent after COVID-era  shortages.

“This explains their decrease in selling prices across 2024,” it said.