NEW AND USED VEHICLE SALES RISE, WHOLESALE PRICES REACH RECORD PEAK IN FIRST HALF OF 2010

ATLANTA – In what remained a volatile marketplace in the first half of 2010, new and used vehicle retail sales volumes increased, wholesale used vehicle volumes declined and wholesale vehicle values reached record highs.

These and a host of other industry trends are analyzed in-depth in the Mid-Year edition of Manheim’s Used Car Market Report, the definitive source of information and trends that shape the wholesale and retail used vehicle markets. The Report was released today by Manheim Consulting chief economist Tom Webb and is available online at www.manheim.com/consulting.

“Everyone with a stake in the used vehicle market needs as much information as possible to make smarter decisions,” said Manheim president and CEO Dean Eisner. “Readers from all segments of the industry will find this report useful as they develop a deeper understanding of the state of the used vehicle business.”

Among the highlights of the Report:

SALES VOLUMES
• Total new vehicle sales in the first half of 2010 came in at a seasonally adjusted annual rate of 11.1 million; fleet sales were up 41% over last year, while retail sales were up 12%.
• Total used vehicle retail sales increased by 3.6% in the first half of 2010; sales by dealers were up 4.4% and private-party transactions rose by 1.8%.

THE WHOLESALE MARKET
• Auction volumes declined in the first half of the year, with units sold down 8.2% from last year, according to the National Auto Auction Association.
• Wholesale prices, meanwhile, reached a record high in May’s Manheim Used Vehicle Value Index. On an annual average basis, wholesale used vehicle prices as of June were 5.3% above their year-ago level.

ONLINE ACTIVITY
• Manheim.com is receiving a record 900,000 visits per week, and more than 21% of all Manheim transactions took place online via Manheim Simulcast or OVE.com.

RENTAL MARKET
• In 2010, the rental industry is expected to purchase between 1.5 million and 1.6 million vehicles, up from 1.1 million units in 2009. In the first half of 2010, Detroit 3 manufacturer vehicles accounted for 69.6% of total rental car purchases, compared to 80% in 2006.
• Risk vehicles account for more than 65% of units in service in 2010, and an even higher percentage of vehicles purchased. Average auction prices for both rental risk and repurchase vehicles remain above prior-year levels, with repurchase vehicle values remaining at record-high levels since the second half of 2009.

LEASING AND REPOSSESSIONS
• In the first half of 2010, auto ABS issuance totaled $34 billion, up 35% from its year-ago level.
• After reaching a peak of 1.9 million units in 2009, total repossession volumes are expected to decline 11% to 1.7 million vehicles in 2010.
• After falling to 1.1 million units in 2009, new lease originations are estimated to increase 33% in 2010. Still, due to low lease originations in recent years, off-lease volumes will continue to decline dramatically through 2012.

COMMERCIAL AND GOVERNMENT FLEETS
• In the first half of 2010, commercial fleets bought 227,200 vehicles, up 34% from the same period in 2009, but still one-third less than the 2008 level. By year’s end, total commercial fleet vehicles are expected to reach close to 475,000, which would represent a 37% increase.
• Government fleets purchased 9% fewer vehicles in the first half of 2010.
• The shortage of used vehicles in the auction lanes has brought strong demand and prices for end-of-service fleet vehicles.

SALVAGE
• In the first half of 2010, the number of vehicles remarketed through salvage auctions declined approximately 5%, and it is unlikely that salvage volume will rebound until the economic recovery gains enough momentum that vehicle owners are encouraged to scrap rather than repair damaged vehicles.