CARY, N.C. –
Retail vehicle prices in Canada were down slightly month-over-month in May, though consumer interest and traffic — at least the online variety — was increasing.
That’s according to the latest autoTRADER.ca Price Index report, which said the national median price for new vehicles was at $39,799 in May, down 0.8% from April and up 1.3% from May 2019.
The national median price on used vehicles was $18,888, down 0.6% month-over-month and down 0.5% year-over-year, according to autoTRADER.ca.
But despite this “slight continued decrease in new- and used-vehicle prices,” consumer interest appears to be moving ahead.
“As retailers across the country begin to resume regular business operations, they are being met with renewed interest from consumers,” autoTRADER.ca said in the summary of its report.
“In the month of May alone, autoTRADER.ca observed an all-time high of 20 million visits, representing a 15% year-over-year increase in traffic on the marketplace,” it said. “This uptick could indicate an influx of Canadians seeking to re-enter the vehicle market.”
The movement in retail prices did vary by province, at least on the new-car side, according to autoTRADER.ca.
Changes ranged from a 2.8% month-over-month decline in Alberta to a 1.0% hike in Manitoba and Saskatchewan.
Ontario’s new-car prices were down 0.1%, Quebec was off 0.8% and British Columbia fell 1.7%.
New-car prices in the Atlantic region were up 0.4%.
Things were different in the used-vehicle retail market, where every province but Quebec showed a decline in price.
Alberta’s used-car prices were down 3.0%, the Atlantic Region was down 2.7%, and Ontario was off 2.4%. Used prices fell 2.2% in Manitoba and Saskatchewan and were off 2.0% in British Columbia, according to autoTRADER.ca.
Used prices were flat in Quebec, which the company said continues to have “the most affordable new and used vehicles across Canada.”
autoTRADER.ca analyzes price data on more than 450,000 vehicle listings in compiling its price index.
Despite slight declines in retail prices, the slowdown is modest compared to the wholesale decline.
In its COVID-19 Market Update released on Tuesday, Canadian Black Book said: “We continue to see stability in retail asking prices, even as consumer confidence struggles to recover from the large hit it took in May. It appears that consumers have not seen a material price drop in the used-vehicle marketplace. Currently, retail prices are decreasing at a much lower rate compared to wholesale.”
But CBB is expecting steeper declines in retail prices (and wholesale, for that matter) due to expected declines in consumer demand in coming months.
Adding more overall context, CBB noted: “As we enter the summer months, we expect wholesale and retail prices to deteriorate even further.
“We attribute this projected decrease to the large influx of incremental used inventory expected to hit the marketplace, as well as the continued weakening of consumer retail demand due to the deep recession at hand,” the report said.
“Although sales did show a strong uptick in May, we feel that a large portion of that lift was pent-up demand from late March and April. Once that demand has been met, we expect to see the natural tempo in the marketplace.”