Mercedes Benz

As spring turned to summer, used-car prices began to heat up. Without a big shock like last year's hurricanes, it is extremely rare for used cars to appreciate like this during summer. Yet, our weekly price index shows the most-sold vintage of vehicles at Manheim — 3-year-old vehicles — are worth 2 percent more than they were just eight weeks ago. Think about this: A depreciating asset is worth 2 percent more than eight weeks ago, when normally it would have lost about 1 percent of value. The Manheim Index set a record in July. The index is based on all vehicles sold at Manheim and is the best indicator of what dealers are paying for used vehicles. The record bested the one set in October at the peak of the replacement demand frenzy after hurricanes Harvey and Irma. This time, no natural disaster has wiped out supply and created replacement demand. Generally, prices increase when a demand-supply imbalance occurs. Even though higher prices should encourage an increase in wholesale s...