The past several months have been a roller coaster ride of severe drops in value followed by a historic increase in pricing for June. After all that, this month actually looks sort of normal…believe it or not. Almost all changes are only of a single percent or two, and the overall market is beginning to reach an equilibrium point near where we would have expected it to be before the coronavirus upended everything.
“After a roller coaster ride over the past several months, July’s Powersports value adjustments are modest, and generally conform to what we would say are “normal” amounts for the time of year,” said Scott Yarbrough, senior analyst of motorcycle and powersports at Black Book.
One thing to note about our new “normal,” it is likely anything but. While superficially the market looks to be in a fairly typical place for mid-summer, there are a number of external factors significantly influencing current conditions. First, inventory at the wholesale auctions is still significantly constrained, limiting the supply of used vehicles. Second, new inventory from the manufacturers is also running below normal levels due to previous plant shutdowns and continuing supply chain disruptions from the coronavirus. Third, the full economic impact of the coronavirus and high levels of unemployment have been blunted by the government. When these supply constraints ease up on both the new and used side, and if the government assistance dries up as it is currently scheduled to at the end of the month, we will likely be looking at another major change in market conditions soon.
Link: Black Book