RV wholesale values were mixed in February, Black Book reported, but overall auction volumes within all segments were up.
Motorhome auction volume increased 1.8 percent, while towables rose 1.6 percent.
“Auction volumes for all segments were up over the preceding month, mirroring the rise in shipments of new RVs,” Black Book Principal Analyst of Specialty Markets Eric Lawrence said. “As we head into spring, we are expecting wholesale values to increase as dealers compete for units to stock their lots.”
In this month’s report, Black Book found motorized unit values down $1,647 and towables up $801 from February, an all-time high.
The average motorized selling point was $59,092, a 2.7 percent decrease from the previous month. In the towables sector, average selling price increased 4.1 percent to $20,371. On year ago, the average motorhome sold for $43,854, while towables were selling for a $14,462 average.
Lawrence said he is hearing dealers discuss upcoming price increases from manufactures, which will lead to higher selling prices. When the new units go up, the used inventory will too, he said.
“It is fairly consistent spread between new and used units, so when you move one, it moves the other,” he said.
“Things are starting to open up, people are getting the vaccine and are more comfortable going out,” Lawrence said. “RVing has been hot anyway, but not they are just taking down more barriers that prevent people from doing what they want to do, [RVing].”
Discussing volume, Lawrence said some increase can be attributed to repossessions, a major auction inventory source. However, lenders are not doing as many repossessions as they were before the pandemic, Lawrence said.
“That has to do with health and safety, because not all lenders are comfortable sending someone out, but also deals with bad PR with repossessions and going through Covid problems,” Lawrence said.
Similar to landlords having problems evicting residents during the pandemic, Lawrence said there are some areas where the same scenario is playing out in repossessions.
“Some states have moratoriums on repossessions through the pandemic,” he said. “They are down across the board, with cars and trucks, too. There are a lot of factors not allowing for it from a legal standpoint, or maybe a PR standpoint or a logistical standpoint.”
Other volume contributions come from when a dealer buys a unit he does not want to put on the lot, Lawrence said, but he had to buy it to sell a newer unit.
“In that case, they will take it to the auction and maybe buy something they wanted,” he said.
Lawrence noted a big factor playing into sourcing used inventory: an influx of new buyers who do not have trade-ins to offer. Trade-ins are often the cheapest way for dealers to gain inventory, he said, because there are no auction fees or bidding against other dealers.
“We have had a record number of first-time buyers for the past year, which means there is a dramatic downtick in the number of trade-ins,” Lawrence said. “The fewer trade-ins that come, the more dealers will keep and the less they will send to auctions. Couple that with a decline in repossessions, and that is really the two factors forcing down the number of units available at auctions.”
Lawrence noted Black Book is not seeing a “big bump” in volume, as last year’s April through June numbers were down to almost nothing.
“A lot of auctions and dealerships were closed,” he said in regard to the pandemic. “But things have been very stable since July. There are some ups and downs – and some luck with whatever happens to sell that month – but inventory has been fairly stable since late summer, early fall.”
February’s inventory levels were higher than January, Lawrence said, and he expects March numbers to top last month.