Used car depreciation rates are now showing normal patterns for this time of the year after strong retention in summer. -$ % -$85-0.

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1 WEEKLY CHANGE WEEKLY CHANGE ember 5, 2018 Used car depreciation rates are now showing normal patterns for this time of the year after strong retention in summer. 0% Anil Goyal, Executive Vice President, Operations -0.2% -0.4% -$ % -0.6% -0.8% -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$65 CARS -0.60% 0% -0.2% -0.4% -0.6% -0.8% -1.2% -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$ % -$79 TRUCKS -0.48% Model Years: , Volume Weighted Wholesale Average Values, Weekly Change from 10/26/18 to 11/2/18 Compact Van Values Sliding Volume-weighted, overall car segment values decreased by 0.60% last week. In comparison, the market values had decreased by 0.47% on average during the prior 4-week period. In cars, the Full-Size Car segment experienced the biggest drop. Volume-weighted, overall truck segment (including pickups, SUVs and vans) values decreased by 0.48% last week. In comparison, the market values had decreased by 0.35% on average during the prior 4-week period. In trucks, the Compact Van segment performed the worst.

2 ember 5, 2018 Sentiment from the Auction Lanes Our editors and personnel attend several auctions every week across the country to provide key insights: Attendance and inventory was moderate to low today. No-sales were abundant throughout the day, even though the floor prices seemed to have been more relaxed and generally lower. Andrew in Ga The fall market is here. Vehicles are in short supply and the demand has slowed. Auction Owner in MO The older vehicles in above average condition are selling well. There appears to be very little interest in the sporty type vehicles. Richard in TX Trucks are drawing the most interest. There was active bidding and selling on most of the lanes, which indicates lower floor prices. Richard in WI A more typical fall market as prices have dropped and retail is slower. The demand is for vehicles with good miles and a clean history report. Gerry in FL 12-Month Depreciation by Segment 1, 2017 to 1, 2018 Source: Black Book Visual Analytics Luxury segments show the highest depreciation rates with depreciation in the last 12 months over 16% in each segment. On the other hand, small pickups, commercial vans and compact cars have the lowest depreciation. Vehicle Highlight The All-New 2019 Volvo S60 features redesigned exterior styling and enhancements to semi-autonomous driving system. The first American-built Volvo is offered in three trim levels; R-Design, Inscription and Momentum. MSRP with destination ranges from $36,795 (T5 FWD Momentum) to $48,395 (T6 AWD Inscription). Key competitors include the BMW 3-series, Jaguar XE, Audi A4, and Infiniti Q50. This week s report includes our Monthly Edition Supplement on Specialty kets. 2

3 SPECIALTY MARKETS: COLLECTIBLE CARS ember 5, 2018 Collectible Car Auctions Continue to Thrive This is normally the time of year when we look back on the year s auctions and start talking about what we think will happen out in Arizona in January. However, it seems that there isn t an off season anymore, and there are several more auctions coming up before then: Mecum in Las Vegas and Kansas City, RM at the Petersen Automotive Museum, McCormick s in Palm Springs, and Leake in Dallas, just to name a few. Eric Lawrence, Director of Specialty kets 5.00% Percent Change from ember 2017 to ember % 3.00% 2.00% 1.00% 0.00% -1.00% 4.46% 4.45% 1.04% -0.31% -3.44% 1.41% -2.00% -3.00% -4.00% Muscle Cars Pony Cars American Classics Sports Cars Exotic Cars Classic Trucks RM Sotheby s Hershey auction did very well, bringing in $11,000,000 and an impressive 94% sell through ratio. Their Porsche 70 th Anniversary Auction in Atlanta generated $25,800,000 in sales with a 92% sales rate. Bonham s Zoute Grand Prix sale, which focuses on important European sports cars, had sales in excess of $9,000,000, while the Simone Foundation auction raised over $2,500,000 to help support their endeavors. Mecum had an impressive showing in Dallas, breaking through $30,000,000 in sales with a 73% sell through rate. Their Chicago sale brought in $17,500,000 with 75% of vehicles selling. Town & Country. Courtesy of RM Sotheby s. Notable Recent Auction Sales Include: 1948 Chrysler Town & Country Sedan $93,500 (RM Sotheby s) 1930 Cadillac V-16 Roadster $495,000 (RM Sotheby s) 1936 Packard Twelve Coupe Roadster $269,500 (RM Sotheby s) 1985 Porsche 959 Paris-Dakar $5,945,000 (RM Sotheby s) 2015 Porsche 918 Spyder $1,400,000 (RM Sotheby s) 1973 Porsche 911 Carrera Lightweight $1,000,000 (RM Sotheby s) 1970 Plymouth Hemi Superbird $280,500 (Mecum) 2017 Ford GT Coupe $1,320,000 (Mecum) 1962 Aston tin DB4 Vantage Coupe $1,290,000 (Bonhams) 1954 Arnolt-Bristol Roadster $450,000 (Mecum) 3

4 Jan-14 Jun Jul Jan-15 Jan-16 Jan-17 Jan-18 Jan-14 Jun Jul Jan-15 Jan-16 Jan-17 Jan-18 SPECIALTY MARKETS: RECREATIONAL VEHICLES ember 5, 2018 Motorhome Values Surge On Late Model Consignments The average selling price of motorized units at auction last month increased nearly nine percent, which comes in at the third highest amount ever. One thing that caught my eye was that there was a larger than usual amount of 2018 models in the mix, perhaps being disposed of to make room for some incoming 2019s. Auction volumes were up substantially across the board, not uncommon for this time of year as dealers adjust their inventory levels for winter. Eric Lawrence, Director of Specialty kets Motor Home Value Trends For Motor Homes (including Class A, B, and C) Average selling price was $48,269 up $3,785 (8.5%) from the previous month One year ago, the average selling price was $48,537 Auction volume was up 25% from the previous month. The average model year was Travel Trailer and Fifth Wheel Value Trends For Towables (including Travel Trailers and Fifth Wheels) Average selling price was $13,939, up $381 (2.8%) from the previous month One year ago, the average selling price was $14,581 Auction volume was up 18% from the previous month. The average model year was

5 SPECIALTY MARKETS: POWERSPORTS ember 5, 2018 Powersports ket Enters Typical Fall Pattern ember brings with it a couple of surprises. At a time when all Powersports segments except Snowmobiles should be depreciating, both the Scooters and ATVs have gained a little bit in value. Scott Yarbrough, Motorcycle & Powersports Editor 1.5% 1.0% 0.5% Motorcycle & Powersports Percent Change ober to ember % 0.6% 0.5% 0.0% -0.5% -1.5% -2.0% -1.5% -0.7% -1.4% -1.5% -1.6% -2.5% -3.0% -2.5% -2.4% -2.7% Scooters almost never appreciate after Labor Day, but we have seen them continue to be relatively strong performers throughout fall. We are not sure why, but the delayed onset of cooler weather in many areas of the country may have extended their season a bit. ATVs being up right now is less of a surprise, as these units are used heavily in the fall for hunting, agriculture, and outdoor recreational activities. The ATVs used to appreciate noticeably in the fall, but have taken a back seat in value retention to their larger cousins the Utility Vehicles in that department over recent years. Larger touring bikes in the Cruiser segment are down a bit more than the smaller bikes. This continues a trend we have been seeing for a little while now, where the higher end more expensive units are slightly outperformed by their entry level and mid-line brethren. Of note this month is that we are starting to see a bit of extra depreciation in the V-Rods for the first time since Harley-Davidson stopped production. They have been mostly tracking with the rest of the line-up value wise, but have dropped by an extra half percent or so recently. 5

6 Monthly Change SPECIALTY MARKETS: HEAVY DUTY ember 5, 2018 Used Heavy Duty Values Continue at Record Breaking Strength! Both buyers and sellers are watching the market closely, as neither side wants to miss out on getting either the truck they desire or the highest price for the units they have to remarket. $0 -$200 -$400 -$600 -$800 -$1,000 -$1,200 Charles Cathey Heavy-Duty Truck Editor Average Wholesale Value Changes (ket) Construction/Vocational Over the Road Trucks & Tractors Regional Tractors Used trucks are not depreciating too much right now, and the savings continue to be significant over the cost of ordering new trucks, even factoring in the possibility of expensive repairs. The money being saved buying used trucks does help offset more frequent driver salary increases which has become necessary to maintain drivers and a significant factor in the profit equation. Construction/Vocational Over the Road Trucks & Tractors Regional Tractors MODEL DATE Value $ Change % Change Value $ Change % Change Value $ Change % Change YEARS 11/01/18 96, % 78, % 69, % /01/18 96, % 78, % 69, % HD Construction/Vocational segment dropped an average of $ 201 (0.2%) in ober, compared to the average decline of $370 (0.4%) in ember HD Over the Road Tractor segment dropped an average of $258 (0.3%) in ober, compared to the average drop of $545 (0.7%) in ember HD Regional Tractor segment dropped an average of $192 (0.3%) in ober, compared to the average depreciation of $465 (0.7%) in ember. Construction/Vocational Over the Road Trucks & Tractors Regional Tractors MODEL DATE Value $ Change % Change Value $ Change % Change Value $ Change % Change YEARS 11/01/18 49, % 33, % 26, % /01/18 49, % 34, , HD Construction/Vocational segment dropped an average of $223 (0.4%) in ober, compared to the $276 (0.6%) in ember HD Over the Road Tractor segment dropped an average of $196 (0.6%) in ober, compared to $337 (1.0%) average depreciation in ember HD Regional Tractor segment dropped an average of $153 (0.6%) in ober, compared to the average drop of $273 (1.0%) in ember. 6

7 SPECIALTY MARKETS: MEDIUM DUTY ember 5, 2018 Stabilization Trend Continues for Medium Duty Trucks Used Truck prices remain stable through ober as demand for units in this segment continue to increase due to increases as freight and construction industries continue to thrive. Josh Giles - Senior Truck Editor Medium Duty MODEL Medium Duty MODEL DATE Value $ Change % Change YEARS DATE Value $ Change % Change YEARS 11/01/18 21, % /01/18 49, % /01/18 21, % /01/18 49, % Older Models ( ) dropped an overall weighted average of $46 (0.2%) in ober. This is an improvement over the $113 (0.5%) drop witnessed in ember. Late Models ( ) dropped an overall weighted average of $196 (-0.4%) in ober. This is also an improvement over the $356 (0.7%) drop seen this past month. CHANGES IN WHOLESALE VALUE MODEL YEARS 2014 TO $200 +$100 $0 -$100 -$200 -$300 -$400 -$500 -$600 -$700 '17 '17 '18 Jun '18 '18 CLASS 4 CAB/CHASSIS CLASS 5 CAB/CHASSIS CLASS 6 CAB/CHASSIS CLASS 7 CAB/CHASSIS LIGHT-DUTY PICKUP TRUCKS Units in Classes 4 through 7 continue to stabilize due to limited supply of good used trucks mixed with an increase in demand across the country. Recent storms that have devastated parts of the East Coast have aided in the increased demand for units in these segments as cleanup and construction efforts continue. Diesel Price Changes 09/17/18 +$ /24/18 +$ /01/18 +$ /08/18 +$ /15/18 +$ /22/18 +$0.58 +$0.80 +$0.60 +$0.40 +$0.01 +$0.00 +$0.04 +$0.07 +$0.01 -$0.01 +$0.20 +$0.00 -$0.20 Price Chg/Week Price Chg/Year 1745 N. Brown Rd., Suite 130, Lawrenceville, GA info@blackbook.com Opt-in to receive reports from Black Book at 7