Misguided ? Why ?
Certainly not misguided for someone who wants to trade-in their car, and not obvious to me why auctions and private sale prices would not move in the same direction; in fact, along similar percentage trajectories.
The article certainly does not support the notion thrown out here that the value of TDIs will increase due to low supply. VW is storing the cars returned to them and yet the prices on the remaining cars available is dropping. That seems consistent with the reports of VW dealerships having few shoppers -- demand for VW cars is down, and demand for VW diesels down even further.
A contradicting datum is VW sales, but I don't know specifics of how they count or what the latest period covers.
Of course it's not obvious to you...you've been singing the same tune with all your posts: being deliberately obtuse. At least I think, hope, it's deliberate
You genuinely don't understand why wholesale prices might go down while private sale prices don't?
First of all, the largest volume auction participants are precluded from selling TDI's in the country. There are some dealerships that might be able to sell their TDIs on another lot, but why bother? They certainly aren't going to spend a lot of cash stockpiling TDI's on their Honda and Subaru lots hoping someone looking for one of those decides to give a news pummeled TDI a test drive.
There might be some huge dealers willing to stockpile their inventory in a warehouse somewhere while they wait for the EPA green light. But those buyers are going to have the muscle and pocketbooks to drive the prices down on the "tainted" cars at an auction.
Have you ever been to a car auction? I have, not because I worked at a car dealership, but because my Dart was towed off a city street when I blew a headgasket and I had to try and get it back. The carburetor was worth over $300 dollars alone and that's what I paid to get my Dart back. Everyone was paying 2-3x for Hondas and Toyotas that probably flew off their lots as soon as they unloaded them. I don't think anyone even bothered to bid on my muscle car. The "value" of the vehicle had very little relationship to what anyone was willing to bid and what I ultimately paid.
Auction participants aren't buying or selling at market value. They're just liquidating inventory as fast as possible.
A dealership that is paying storage fees and soaking inventory space with a car that can't be sold is taking it to the auction and unloading it to a dealer that can sell it. If someone bids 10K on a car that's the price it sells for unless someone else bids 10.5K.
In the private market if someone offers a seller 10K for a car that is listed at 15K the buyer is told to kick rocks...unless someone is really hurting for cash. And judging by some of the posts on here people are dumping their TDIs for chicken feed. Whenever some of us caution them to calm down a veritable ****storm ensues. But none of that activity is representative of a car's value.
The article you and I are analyzing even states that almost all of the diesels at auction are from private sellers, and that auction houses are holding onto their inventory. So private sellers are either panicking or forced to sell for some unknown reason and, given that there aren't any bidders, the low bids are winning out thereby driving the average auction pricing down.
If sales volume is low, there doesn't need to be many cars sold at a significant loss to move the average price downward, and the article clearly pointed this out.
If you want to look at a car's value, especially a niche car like a diesel (and a wagon or European car in general, which are multiple intersecting niches that comprise a very tiny segment of the population), you have to look at private sales data.
Even before the scandal VW sales were plummeting
http://247wallst.com/autos/2015/05/02/volkswagen-sales-in-us-continue-to-crash/
The US market has been a boondoggle for VW for as long as I can remember.
Most people I know won't touch an out of warranty VW with a ten foot pole, so looking at sales data vs. book prices is going to give a vastly skewed perspective of what the real world values are in the private market.
Despite all this, dealerships that can sell TDIs are experiencing an uptick in sales:
"Sales of new Volkswagen cars were largely unaffected last month despite the explosion of the diesel emissions scandal, new figures show.
The controversy broke on the 21 September, but the German badge sold 39,263 models last month compared to 37,852 in September 2014, the data shows"
http://www.thisismoney.co.uk/money/...-emissions-scandal-official-figures-show.html
Private sales are also *up*
"The aftermath of Volkswagen's emissions scandal has actually created a busier online marketplace for the German automaker's used diesel vehicles in the United States.
Online used car marketplaces such as Kelley Blue Book or AutoTrader.com have seen a significant upswing in activity surrounding the specific vehicles affected by the scandal. (Tweet This)
On Thursday, Volkswagen revealed that its U.S. sales rose 0.6 percent in September, versus an expected decline of 7.3 percent.
"On AutoTrader, we are seeing shopping for diesels up," said Michelle Krebs, a senior analyst at AutoTrader, who noted that the volume of shopping activity between private parties, including purchases and negotiations, is up by almost a fifth over the last week."
http://www.cnbc.com/2015/10/01/volkswagen-scandal-creates-brisk-resale-activity-online.html
And in those private sales, prices have only dropped .06%
"The price drop isn't surprising. The risk of being stuck with a bunch of toxic assets isn't worth the reward to the average car dealer. Drivers, however, see things differently. Volkswagen's diesels don't appear to have been dented nearly as much on secondary markets, where owners sell used cars directly.
At CarGurus, an online car shopping platform, the average price of the affected cars has only dipped by .06 percent since the scandal broke. Carlypso, a California based car-shopping startup, reported a price drop of .3 percent. That’s right—all the hue and cry about a sinister plot to cheat emissions tests sent prices plunging by about $30. “So far, it looks pretty much like a wash,” said Carlypso co-founder Chris Coleman."
http://www.bloomberg.com/news/artic...n-t-stopped-buying-volkswagen-s-dirty-diesels