Wholesale used-vehicle prices (on a mix-, mileage-, and seasonally adjusted basis) decreased 1.3% in June from May. This brought the Manheim Used Vehicle Value Index to 219.9, up 9.7% from a year ago. The non-adjusted price change in June decreased 1.8% compared to May. The drop in June left the unadjusted average price up 10.7% year over year, significantly below the increase recorded in March when year-over-year growth stood at 23.3%.

"It's refreshing to report we are seeing some trends returning more toward normalcy in the used market," said Cox Automotive Chief Economist Jonathan Smoke. "Much of the focus year to date has been on how much sales are down compared to last year, but that was an impossible comp. The used retail market has been gaining momentum as the year progressed. The opposite occurred last year. We could see more used vehicles sold in July this year than last. Contrary to some opinions, there is little evidence of consumers pulling back, either when it comes to the retail vehicle market or more broadly reducing spending in total. If the consumer pulls back, we will see a recession, as the U.S. economy is consumer driven. But I'm not seeing evidence of us going into or already being in a broad market recession. The jobs market is solid, and consumer demand is there as a result."

Manheim Market Report (MMR) values saw larger declines over the last two weeks than in the prior two weeks. MMR is a valuation tool that tens of thousands of consignors and dealers use to assess millions of trade-ins each month. It is designed to be highly stable and avoid overreacting to short-term market ups and downs to provide an accurate measure of vehicle valuations regardless of market conditions.

Over the last four weeks, the Three-Year-Old Index decreased a net 2.5%. Over the month of June, daily MMR Retention, which is the average difference in price relative to current MMR, averaged 98.4%, meaning market prices were slightly behind MMR values. The average daily sales conversion rate declined to 51.7%, which was a typical seasonal pattern but was at a level below normal for the time of year. For example, the sales conversion rate averaged 57% in June 2019. The lower conversion rate indicates that the month saw buyers with more bargaining power for this time of year.

All major market segments again saw seasonally adjusted prices that were higher year over year in June, except for pickups showing a 2.5% decline. Vans had the largest increase at 23.1%, with compact and sports cars maintaining seasonally adjusted year-over-year gains ahead of the overall industry. Compared to May, all major segments' performance was down. Pickups and midsize cars lost more than 2%, followed by luxury cars and vans at 1.8% and 1.6%, respectively.

"The market for used isn't getting worse; we're just in a slightly lower gear right now," said Chris Frey, senior manager of economic and industry insights, Cox Automotive. "And with used-vehicle values moderating and following a more normal pattern, that may even become a tailwind. New-vehicle inventory remains challenged, and that will help support demand for used vehicles."