September 3, 2018

“Used sedans are hot in the market as value-conscious consumers look for affordable transportation.”

Anil Goyal, Executive Vice President, Operations

Model Years: 2010-2016, Volume Weighted Wholesale Average Values, Weekly Change from 8/24/18 to 8/31/18

Mainstream Sedans Doing Better Than SUVs Three Weeks in a Row

• Volume-weighted, overall car segment values increased a little by 0.03% last week. In comparison, the

market values had decreased by 0.15% on average during the prior 4-week period.

• In cars, the Mid-Size Car segment experienced the biggest increase.

• Volume-weighted, overall truck segment (including pickups, SUVs and vans) values decreased by

0.11% last week. In comparison, the market values had decreased by 0.14% on average during the

prior 4-week period.

• In trucks, the Compact Luxury Crossover/SUV segments performed the worst.

-$1-0.01%

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2

September 3, 2018

Sentiment from the Auction Lanes Our editors and personnel attend about 60 auctions every week across the country to provide key insights:

“The volume is still down but the prices are not. Buyers are not thrilled about the extra bidding it takes to secure inventory for their lots.” Mark in GA

“Fewer no-sales today and about the only vehicles not selling were the large commercial vans.” Rick in FL

“An auction GM in North Carolina says that they are consistently selling around 65% and believes the high conversions will continue until more supply comes to the physical auctions.” Tim in NC

“One thing that stood out today was the dealers’ acceptance to higher mileage vehicles which points to the lower supply.” Robert in PA

“The nicer vehicles still bring really strong money but the older, condition challenged ones are a tough sell.” Bob in MA

One-Year Depreciation by Segment (Mainstream Sedans vs SUVs) August 1, 2017 to August 1, 2018

Source: Black Book Visual Analytics

The depreciation on mainstream sedans has been better than most SUVs in the past 12 months, unlike the trends

seen in previous years.

Vehicle Highlight

The All-New 2019 Jaguar I-Pace is Jaguar’s first attempt at an all-electric vehicle. Powered by dual electric motors, this SUV is capable of 394 hp and 512 lb- ft of instant torque. The I-Pace comes standard with a 90kWh battery that has an estimated range of 240 miles. Base MSRP for the I-Pace starts at $70,495 including destination charges and its main competition includes the Tesla Model X, BMW X4, and Porsche Cayenne.

This week’s report includes our Monthly Edition Supplement on Specialty Markets.

3

September 3, 2018

Monterey Auctions Break Several World Records “With a cumulative total of nearly $370,000,000, it’s safe to say that Monterey 2018

was a success. Dozens of very high dollar cars changed hands for incredible

amounts of money, even if the one that captured the attention of the worldwide

media as the most expensive car to ever sell at auction, the 1962 Ferrari 250 GTO, actually sold for less

than the lower range of its pre-sale estimate.”

Eric Lawrence, Director of Specialty Markets

• Mecum’s Monterey Auction achieved roughly $45,000,000 in sales with a 52% sales percentage.

• RM Sotheby’s Monterey Auction brought in $158,000,000 with an 83% sell through rate.

• Gooding’s Pebble Beach Auction totaled $115,000,000 with an 82% sales percentage.

• Russo and Steele’s Monterey Auction saw $7,000,000 in sales and a 48% sell through rate.

• Worldwide Auctioneers’ Pacific Grove Auction totaled $5,500,000 with a sell through of 56%.

• Bonhams’ Quail Lodge Auction achieved nearly $38,000,000 with a sales percentage of 81%.

Notable Recent Auction Sales Include:

1962 Ferrari GTO Coupe $48,400,000 (RM Sotheby’s)

1935 Dusenberg SSJ Roadster $22,000,000 (Gooding)

1966 Ford GT40 Coupe $9,800,000 (RM Sotheby’s)

1958 Ferrari 250 GT TdF Coupe $6,600,000 (Gooding)

1937 Mercedes 540K Sports Roadster $3,200,000 (Bonhams)

1953 Siata 208S Spider $1,600,000 (Bonhams)

2014 Ferrari LaFerrari Coupe $3,200,000 (Mecum)

2017 Ford GT Coupe $1,500,000 (Russo and Steele)

1989 Porsche 911 Speedster $181,000 (Russo and Steele)

1962 Shelby Cobra 260 Roadster $990,000 (Worldwide)

Ferrari GTO. Courtesy RM Sotheby’s.

0

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European Sports Cars

SPECIALTY MARKETS:

COLLECTIBLE CARS

4

September 3, 2018

Towable Values Hit Yet Another All-Time High

“The average selling price of towables at auction last month crept up about one a

half percent, reaching another all-time high at just over $15,000. Surprisingly,

the number of units available was down significantly. Motorized volumes were about the same as the

previous month, but their values dipped once again, extending the trend we’ve been seeing most of the

year. The average unit sold at auction was a 2010 model, or eight years old.” Eric Lawrence, Director of Specialty Markets

For Motor Homes (including Class A, B, and C)

• Average selling price was $44,450 down $1,116 (2.4%) from the previous month

• One year ago, the average selling price was $47,723

• Auction volume was down 8% from the previous month

For Towables (including Travel Trailers and Fifth Wheels)

• Average selling price was $15,021, up $217 (1.4%) from the previous month

• One year ago, the average selling price was $12,521

• Auction volume was down 28% from the previous month

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Travel Trailer and Fifth Wheel Value Trends

SPECIALTY MARKETS:

RECREATIONAL VEHICLES

5

September 3, 2018

Powersports Market Sees Declines Across The Board “All segments are down this month in the Powersports market. Most of these are normal seasonal drops, but a few normally strong fall vehicle segments are also down a bit more than is typical for the time of year.”

Scott Yarbrough, Motorcycle & Powersports Editor

• After last month’s substantial drops in value, especially for the Street bikes, this month represents a return to mostly normal fall value adjustments. Street bikes, which dropped over 5 percent in August, are down the least with a 0.5 percent change, bringing their two-month average closer to where it normally would be. This makes last month look more like a blip than a trend for these bikes.

• It is a bit unusual to see all segments down in unison, though this does happen from time to time. The slightly unusual changes this month are in the ATV, Utility Vehicle, and Off-Road segments. Normally at least two of these would still be showing increases in value as we head into fall, and much like the Street bikes this month, may rebound a bit for October.

• We have still not seen any significant changes in the V-Twin market as a result of the recent tariffs affecting either the importation of raw materials, the export of US made models, or any blowback from the politics surrounding these issues. We will continue to keep a close eye on this going forward.

-1.1%

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-1.5%

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0.0%Motorcycle & Powersports Changes August to September 2018

SPECIALTY MARKETS:

POWERSPORTS

6

September 3, 2018

Heavy Duty Auction Values Went Down in All Model

and Age Segments!

“New Heavy-Duty Truck Orders are being delivered although the turn-in

units are not showing up at auction at the same rate.” Charles Cathey –

Heavy-Duty Truck Editor

• It appears that many of the first new Over the Road and Regional Tractors being delivered are

additional units that are not resulting in one to one trade-ins.

• Used truck needs are holding up well, so depreciation is still modest for the above segments.

• Older Construction/Vocational units are holding up well, with the late models declining.

DATE

Construction/Vocational Over the Road Trucks & Tractors Regional Tractors MODEL

YEARS Value $ Change % Change Value $ Change % Change Value $ Change % Change

09/01/18 97,232 -497 -0.5% 78,829 -721 -0.9% 70,410 -718 -1.0% 2016-2017

08/01/18 97,729 -306 -0.3% 79,550 -623 -0.8% 71,128 -647 -0.9% 2016-2017

• 2016-2017 HD Construction/Vocational segment dropped an average of $497 (0.5%) in August compared to the average decline of $306 (0.3%) in July.

• 2016-2017 HD Over the Road Tractor segment dropped an average of $721 (0.9%) in August compared to the average drop of $623 (0.8%) in July.

• 2016-2017 HD Regional Tractor segment dropped an average of $718 (1.0%) in August compared to the average depreciation of $647 (0.9%) in July.

DATE

Construction/Vocational Over the Road Trucks & Tractors Regional Tractors MODEL

YEARS Value $ Change % Change Value $ Change % Change Value $ Change % Change

09/01/18 50,026 -374 -0.7% 34,523 -436 -1.2% 27,375 -436 -1.6% 2008-2015

08/01/18 50,401 -424 -0.8% 34,959 -516 -1.5% 27,811 -479 -1.7% 2008-2015

•

• 2008-2015 HD Construction/Vocational segment dropped an average of $374 (0.7%) in August compared to the $424 (0.8%) in July.

• 2008-2015 HD Over the Road Tractor segment dropped an average of $436 (1.2%) in August compared to $516 (1.5%) average depreciation in July.

• 2008-2015 HD Regional Tractor segment dropped an average of $436 (1.6%) in August compared to the average drop of $479 (1.7%) in July.

•

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Average Wholesale Value Changes (Late Model)

Construction/Vocational Over the Road Trucks & Tractors Regional Tractors

SPECIALTY MARKETS:

HEAVY DUTY

7

September 3, 2018

Medium Duty Wholesale Values Continue to Drop in August

“The used market remains strong despite new inventory adding some

downward pressure to wholesale prices.” Josh Giles - Senior

Truck Editor

DATE

Medium Duty MODEL

YEARS

DATE

Medium Duty MODEL

YEARS Value $ Change % Change Value $ Change % Change

09/01/18 21,789 -223 -1.0% 2008-2015 09/01/18 50,253 -464 -0.9% 2016-2017

08/01/18 22,012 -331 -1.5% 2008-2015 08/01/18 50,717 -665 -1.3% 2016-2017

• Older Models (2008 – 2015) dropped an overall weighted average of $223 (-1.0%) in August. This is an

improvement over the $331 (1.5%) drop experienced in July.

• Late Models (2016 – 2017) dropped an overall weighted average of $464 (-0.9%) in August. This is also an

improvement over the $665 (1.3%) drop seen the month prior.

• Overall, Medium Duty segments continue to trend in similar patterns with more downward movement in Class 7 units over the past few months.

• Late Models continue a downward trend as new inventory helps push used prices down.

• We expect to see Older Units depreciate less than Late Models over the next couple months.

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www.blackbook.com| info@blackbook.com Opt-in to receive reports from Black Book at http://www.blackbook.com/insights/market-insights

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Jul '17 Oct '17 Jan '18 Apr '18 Jul '18

CHANGES IN WHOLESALE VALUEMODEL YEARS 2013 TO 2015

CLASS 4 CAB/CHASSIS CLASS 5 CAB/CHASSIS CLASS 6 CAB/CHASSIS

CLASS 7 CAB/CHASSIS LIGHT-DUTY PICKUP TRUCKS

$0.00

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$3.50

08/2

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09/1

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U.S. Average Diesel Prices (This Year vs. Last Year)

Diesel/This Year Diesel/Last Year

SPECIALTY MARKETS:

MEDIUM DUTY