The moderate loss in average price observed in August 0.0% -0.5% -1.0% -1.5% Percent Change -2.0% -1.9% -2.5% -3.0% -3.5% -4.

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1 Percent Change Guidelines September 2012 NADA Used Car Guide Industry Update INSIDE: NADA Official Used Car Guide Update NADA Official Used Car Guide Update ATD/NADA Official Commercial Truck Guide Update New Vehicle Sales Data Fuel Price Data Economic Data NADAguides.com Consumer Site Trends USED VEHICLE PRICES Truck segments brush aside latest gasoline spike. The 28 cent rise in the price of gasoline that occurred over the month of August did little to change the course that used vehicle prices have been following over the past few months, as monthly losses were most severe for compact and mid-size cars, while prices for the majority of truck segments dropped just slightly. At a market level, wholesale prices fell by a better-than -expected 1.9% or $316, making August the third month in a row that losses were at or below the 2.0% mark. The moderate loss in average price observed in August Wholesale Depreciation Slows in August ket average slips by a better-thanexpected 1.9%. New Vehicle Sales SAAR Highest in Four Years August s 14.5M unit SAAR best nonstimulus result since April 08. Used Vehicle Demand Still Firm Numerous indicators suggest demand for used vehicles continues to grow. Commercial Truck ket Strong; Tolerance for High Mileage Better Sleeper market unexpectedly up, but newest model years depreciating. AuctionNet Wholesale ket Trends NADA Guidebook Value Trends At NADA Used Car Guide is another sign that demand for used vehicles remains solid, particularly when compared to the ~3.5% mileage- and season-related drop typically witnessed over the month (see page 8 for an assessment of used demand). In addition, the ongoing decline in late-model used supply continues to play a considerable role in supporting used prices. Overall AuctionNet volume for units up to five years in age fell by 3.2% on a sequential basis in August and volume so far year-to-date is down by 12.3%. ly AuctionNet Price Change - y v. August, 2012 Vehicles 1-to-5 years in age, mileage and mix adjusted. 0.0% -0.5% -1.0% -1.5% -2.0% -2.5% -3.0% -3.5% -1.9% -2.4% -0.6% -2.2% -0.8% -2.1% -0.3% -0.8% -1.8% -1.4% While late-model volume for the market con- -4.0% tinues to trend down particularly for truck -4.5% ket Compact Car Compact Utility Mid-Size Car Mid-Size Utility Mid-Size Van Large Pickup Large SUV Luxury Car Luxury Utility segments certain segments did experience Source: NADA Segment large increases in 2012 model year off-rental supply in August. Topping the list in this category were compact and mid-size cars, where 12MY auction volume grew by 46% and 32%, respectively. This infusion of volume worked to offset any lift in demand associated with rising gasoline prices and helped to pressure prices for the small and mid-size car segments down by market leading averages of 2.4% and 2.2%, respectively, or an average of $285.

2 Percent Change Official Used Car Guide Update (continued ) In terms of those models within each segment most responsible for the increase in 2012 model year supply, the Chevy Cruze and Ford Focus comprised 26% and 45%, respectively, of compact car volume in August, while mid-size share was dominated by the Nissan Altima and Chevy Malibu at 21% and 16%. Similar to cars, off-rental volume grew 45% for the mid-size van segment in August, and two models from the same manufacturer, the Chrysler Town & Country and Dodge Grand Caravan, were responsible for 71% of the increase. The large share held by the two models within the segment was enough to drive prices down by 2.0% or $342 for the month. As for truck segments, prices for compact-to-large utilities fell by an average of just over 0.6% or nearly a point and a half better than the average market decline. Losses for the large pickup segment once again improved relative to the preceding month as prices slipped by a barely perceptible 0.3% or just $74 in August. For comparative purposes, prices fell by 1.5% in June and by 1.0% in y. Again, this period of curtailed depreciation was atypical because it coincided with a gasoline price increase that was as acute as any seen in the recent past. Part of this strength can be attributed to falling used supply e.g., late-model large pickup volume at auction was off by 9% on a sequential basis in August but it s also reasonable to assume that consumers are simply becoming more tolerant of gas spikes as they become more frequent (see page 6 for additional insight on this). As with mainstream segments, luxury car losses were steeper than they were for luxury utilities, but the 1.8% ($448) and 1.4% ($396) respective decline for each was better than the loss recorded for the market as a whole. Relative to last August, market prices were down by 1.7% however this was a marked improvement over y s 2.5% year-ago loss. Prices for only three segments all truck-based were higher than Annual AuctionNet Price Change - August '11 v. August '12 Vehicles 1-to-5 years in age, mileage and mix adjusted. 6.0% 4.0% 5.4% they were last august. 2.0% 2.8% 1.7% Prices for mid-size and large utilities were up by 2.8% and 1.7%, 0.0% respectively, relative to last year, while large pickup prices were substantially higher at 5.4%. Prices for other segments remained below last August s levels. -2.0% -4.0% -1.7% -2.2% -4.7% -4.4% -3.2% -4.5% -2.1% -6.0% Although market prices have been below year-ago levels over the ket Compact Car Compact Utility Mid-Size Car Mid-Size Mid-Size Van Large Pickup Large SUV Luxury Car Luxury Utility Utility Segment past few months, per NADA s used price index, which is a mileage-, Source: WardsAuto.com NADA mix-, and seasonally-adjusted measurement of late-model used vehicles prices, prices on a year-to-date basis are still up by $174 or 1.2% due to the positive gains recorded over the first five months of the year. Considering the steep drop-off in prices witnessed last fall and the comparatively slower rate of depreciation expected for the remainder of this year, it s very possible that overall annual growth will improve even more by year s end. 2

3 Official Used Car Guide Update (continued ) NEW VEHICLE MARKET Consumer demand for new vehicles continued to grow last month despite persistent economic worries as total light vehicle sales in August increased by 20% on an annual basis to reach 1.28M units. This brought year-to-date sales to 9.68M units, which translates into a 15% increase over last year s 8.44M units. The month s Seasonally Adjusted Annual Rate (SAAR) reached 14.5M which is the highest observed figure seen in a non-stimulus month since April Looking at sales on the mainstream side, Honda and Toyota experienced growth of 58% and 45%, respectively, over last year s natural disaster-stricken figures. A large portion of Honda s improvement can be attributed to an 82% increase in Accord sales, which came in just shy of the 35k unit mark. Similarly, Toyota managed to sell over 36k Camrys in August for a 9% gain over last year. Helping spur Camry sales was an end-of -model year related $300 sequential increase in incentive spending which pushed total spending to $2,487 per unit. By comparison, Honda spent an average of $3,613 per unit on the Accord but it s important to note that the Accord is set to be replaced by an all-new model this fall while the Camry was just redesigned for the 12 model year. Sales for Volkswagen were up nearly 63% in August which extended the brand s monthly growth streak to twenty-four. Incentives for the brand increased by nearly 31% compared to last year to an average of $2,114 per vehicle, but this was still $230 lower than the mainstream average of $2,344 per vehicle. Domestic brands also fared well last month as Chevrolet, Chrysler, Dodge, and Ford all posted gains relative to last year. Chevrolet s sales rebounded to an 11% improvement after last month s disappointing 7% loss, while Ford s sales increased by 13%. Sales for Chrysler brand grew for the fourteenth month in row, this time by 25%, while Dodge s 15% rise was helped along by 3k sales of the new Dart compact. Nissan sales also improved in August as the brand posted a 6% gain on strong sales of the all-new 13 model year Altima. Sales for the mid-size car totaled nearly 26k units, which was good for an 8% gain over last year. Sales for Kia and Hyundai grew by 22% and 4%, respectively, making it two straight years of growth for the Korean brands. On the luxury side of the market, Acura, Lexus, and Infiniti were the biggest gainers last month. Sales at Acura grew by 74%, while Lexus and Infinity sales improved by 34% and 24%, respectively. With an increase of 11%, sales at Cadillac improved for the third month in a row and sales of the brand s newly introduced XTS sedan crossed the 2k unit mark. Unfortunately Cadillac had to assign an average of nearly $2,500 in incentives, up from y s $1,700 average, to the XTS to help spur activity. Sales at Mercedes-Benz were up nearly 12% while sales for rival German brand BMW declined by 19%. In BMW s case, a large 28% annual drop in incentive spending was most likely the culprit behind the substantial decline in sales. Per Autodata, incentive spending at a market level declined by 5.2% on an annual basis to reach an average of $2,478 per unit. Spending year-to-date stands at $2,503 which is just $21 above last year s disaster-depressed figure. Incentive activity so far this year indicates that manufacturers remain disciplined in the use of incentives as a mechanism to support sales of models less in demand (e.g. end-of-model closeouts, older models at the end of their lifecycle) rather than as compensation for overproduction in general. On the mainstream side, the two brands spending the most on incentives proved to be Buick with an average of $3,980 per unit and Chrysler brand at $3,829 per unit. Hyundai and Subaru spent the least on incentives at just under $1,000 per unit apiece. 3

4 Official Used Car Guide Update (continued ) Luxury brands offering the most in incentives proved to be Jaguar at $6,504 per unit and Cadillac at $6,214 per unit. Lexus and Land Rover spent the least with averages of $2,360 and $1,675 per unit, respectively. In terms of supply, month-end days supply ticked up three days compared to y to a reasonable 58 days, or nine days more that last August s 49 days. For mainstream brands, supply was greatest for Mazda and VW at 85 and 76 days, respectively, putting inventory for both well over the 60 day average considered ideal. Korean brands Hyundai and Kia posted the lowest month-end inventory at 29 days apiece. On the luxury side, days supply for Cadillac and Lincoln was highest at 87 and 80, respectively, while at the opposite end of the spectrum, Audi supply ticked up by 8 days to land at 40 and BMW s inventory grew by 19 days to 34. 4

5 Economic Update The US economy added a meager 96,000 net new jobs in August not significantly changing the unemployment rate from 8.3% in y to 8.1% last month. Since the beginning of this year, employment growth has averaged 139,000 per month, compared with an average monthly gain of 153,000 in In August, employment rose in food services and drinking places, in professional and technical services, and in health care. Employment in other major industries, including mining and logging, construction, retail trade, transportation and warehousing, information, and government, showed little change over the month. Interest rates will stay low and may fall even lower later this year if the Federal Reserve makes good on hints that it will act as soon as their next meeting on September 12th-13th to try to push down long-term interest rates. If the Fed does act, rates may not top current low levels until 2014, making 2013 a good time for businesses to borrow for expansion after many postponed new investment in 2012 because of the slow economy. Expect the recent volatility in oil prices to continue a few more weeks, as jittery markets react to each new piece of economic news and eagerly await more monetary stimulus from the Federal Reserve. But we still expect the U.S. benchmark, West Texas Intermediate (WTI) crude oil, to settle into a trading range between $90 and $95 per barrel toward the end of the month. Improving production at a handful of key oilfields overseas and a decrease in oil demand point to a gradual easing. For motorists, the recent run-up in gasoline prices appears to have leveled off, as forecasted. Now that summer is over, demand for gas should ease a bit, and prices should follow suit. Moreover, the impact of Hurricane Isaac on Gulf Coast oil rigs and refineries turned out to be minimal. So expect regular unleaded gasoline, which is currently averaging $3.82 per gallon, to start a slow decline fairly soon. Truckers and other consumers of diesel fuel should see muted price action, too. At $4.11 per gallon, diesel has tagged along with the rise in gasoline prices. Odds are it will rise even higher, possibly to around $4.15 by mid-september, and then show less of a decline than gasoline. Strong overseas demand for diesel will support prices here in the U.S. Housing sales and prices are on the upswing, and housing construction will add to economic growth this year for the first time since 2005, when the housing market began its slide. But the recovery will be modest, with home sales and prices rebounding from drops earlier in 2012 and posting only small gains by year-end, compared with Investment in new and existing homes usually drives recoveries from deep recessions, and the absence of such an investment surge helps explain why this recovery and expansion has been slower than any since the 1930s. Sales of existing homes look to speed up a bit in the second half of 2012 due to low interest rates and the growing conviction that prices have finally bottomed out. Existing homes sold at an annual pace of 4.47 million in y and should end the year up 4.6 million, a 7% gain over the 4.3 million sold in New-home sales should grow more dramatically, increasing about 20% this year to 360,000 or so. New homes sold at a 372,000 annual pace in y as rates for 30-year fixed rate mortgages hit a record low just under 3.5%. Home prices have begun the first sustained increase since the housing crash, with the median sales price for an existing home climbing in y for the fifth straight month. Prices will continue to edge up, after a sharp decline from a year ago in the number of unsold homes on the market nationwide. The current inventory is low enough to limit supply and nudge up prices in some markets, especially in the West. By year-end, prices should be back to or slightly above the year-end 2011 level in all regions of the country. 5

6 Price Index (1/2/2011 = 0) Gasoline Prices Spike, Used Prices Stay the Course Gasoline prices have jumped again over the past two months which means that used car and truck prices should have expanded and contracted like we ve seen during previous fuel spikes. Only this time around, things haven t remained true to past form. In fact, the 48 cent spike in the price of regular grade gasoline that occurred over the past two months has done little to change the course that segment prices have been following since April. More specifically, over the past three months the 3.0% average rate of loss for compact and mid-size cars has led all others segments by a wide margin, while prices for mainstream truck segments have averaged dips of slightly more than half that amount, or just 1.6%. Translated into dollar terms, the average price of a three year old compact car fell by $1,655 over the period. Hybrid prices have taken an even more extreme hit since the spring. For example, prices for three year old compact hybrids like the Toyota Prius fell by nearly 17% from April to August, or a whopping $2,600. By comparison, large pickup losses totaled only $650. It stands to reason that higher gasoline prices are largely responsible for keeping car losses in August below the higher rate of decline seen over the previous couple of months, but by historical standards any improvement has been slight at best. Even more notable is the continued strength exhibited by truck segments, where higher gas prices have had no discernible impact on demand. So what s going on here? Why haven t we seen more of a pronounced gas-related reaction in used vehicle prices? These questions can probably be answered with just one word familiarity. Of course few events can be explained by just one causal factor and there are other drivers at play here (most notably the ongoing slide in late model supply), but it stands to reason that consumers will become increasingly desensitized to dramatic and rapid changes in fuel prices as these occurrences become more frequent. The chart at right helps illustrates this point by allowing us to compare the movement of used vehicle prices through the last two major swings in gasoline prices. Looking back to last year, we see how car prices exploded and truck prices softened as gasoline prices grew from $3.07 per gallon in early January, to a peak of $3.96 in, Fast forward to this spring and we see that gasoline prices followed a familiar course towards a peak of $3.94 per gallon in April, but that the associated change in used vehicle prices is notably different. Gasoline & Used Vehicle Prices 2-week rolling avg, regular grade gas (national) and 2009MY used vehicle prices Source: NADA Compact Car Mid-Size Car Large Pickup Mid-Size Utility Regular Grade Gas Usedprice volatility has decreased w/ each passing spike in gasoline prices. Week 6

7 Gasoline Prices Spike (continued ) Once again, car prices increased beyond the normal lift associated with the season, but the degree of growth was considerably smaller than what occurred in More distinctly, truck prices remained relatively firm, and in the case of mid-size utilities, they actually improved moderately. So when we pull the curtain back on time a bit farther, the limited reaction that we re seeing today isn t so surprising. In short, it appears that consumers are growing more accustomed to dramatic swings in gasoline prices, and as long as pump prices bounce between charted levels and net annual changes remain moderate, we can expect that consumers will choose to stay the course with their current vehicle which most likely best fits their specific lifestyle rather than make unnecessary sacrifices for the sake of improved fuel economy. 7

8 Floor Traffic Index Change from Prior Year Used Vehicle Demand Remains Firm The pace of used vehicle demand has slowed a bit over the past few months, but that doesn t mean that consumer appetite for used vehicles in close to being satisfied. In fact, numerous indicators suggest that consumer demand for used vehicles continues to grow, albeit at pace slower than what has been observed over the past few years. Starting with used vehicle sales, per CNW data, year-to-date totals through August were 3% better than they were over the same period last year; this is only one point back of the 4% increased witnessed over the same period in That being said, CNW did report that used sales dropped by nearly 16% from y to August, but while high, this result is similar to the 15.2% loss recorded over the same two month period last year. In Annual Change in New & Used Vehicle Sales 20% 15% 10% 5% 0% New Used addition, the y-to-august slide is typical for the time of year, and if activity holds true to seasonal form, we should see used sales continue to erode sequentially through the remainder of year. -5% -10% -15% -20% The ongoing strength of used vehicle prices is another indicator of firm consumer demand. -25% Source: CNW (YTD) Calendar Year Per NADA s used price index, which is a mileage-, mix-, and seasonally-adjusted measurement of late-model used vehicles prices, prices grew by 7.3% on an annual basis last year, and they ve grown by an additional 1.2% so far year-to-date. Again, price growth this year isn t as remarkable as it has been over the past few, but directionally the trend remains positive. Of course the well documented contraction in late model used supply has played a significant role in pushing up used prices over the last few years, but the fact that sales have also improved means that rising demand has also been a factor. If we strictly go by sales and price trends to judge the current state of used vehicle demand and to assess its near-term outlook, it appears that there is still some time to go before used vehicle demand will be satisfied. However, when combined with other indicators the degree of confidence supporting this assumption increases. Turning once again to CNW data, used vehicle floor traffic which is a measurement of consumers actively searching for a used vehicle continues to trend upward and is still some distance back of levels seen prior to the recession. New & Used Vehicle Floor Traffic 3-month rolling average New Used Similarly, the Conference Board s Plans to Buy survey places the 80 percentage of respondents planning to purchase a used vehicle 60 within the next six months back to year-ago levels after having 40 dipped moderately through last winter. 20 We re also seeing similar intention trends on our consumer facing 0 NADAGuides.com web site, as the number of used vehicle searches Source: BLS CNW has grown by 15% year-to-date. 8

9 Net Percentage of Respondants Percent of Consumers Used Vehicle Demand (continued ) On the lending front, banks are not only loosening standards for auto loans, but they also continue to report stronger demand for Plans to Buy within 6 s Percentage of survey respondants planning a new or used vehicle purchase within the next 6 months. 3-month rolling avg; seasonally adjusted. auto loans in general. In fact, the net percentage of bank respondents reporting stronger demand for auto loans (both new and New Used used) in the latest Federal Reserve Senior Loan Officer Survey was 5.0 nearly 20 points higher than it was in the second quarter last year When taken as a collective, it s clear that consumer demand for 2.0 used vehicles remains sound From a sales perspective, used vehicle growth is lagging that of new, but this isn t surprising considering the extreme depths that Source: CNW BLS The Conference Board new vehicle sales fell to over the past few years; because of this, new market gains will logically dwarf those on the used vehicle side. There is legitimacy to the argument that used vehicle demand will suffer as consumers become less fiscally apprehensive and more confident in the future direction of their economic well-being and as such decide to purchase new rather than late-model used; in fact, it could be argued that August s divergent new and used sales results are a reflection of this (although end-of-model promotions certainly helped drive sales on the new side). Federal Reserve Senior Loan Officer Survey Net percentage of banks reporting stronger demand for auto loans Source: Federal Reserve 4/1/2011 7/1/ /1/2011 1/1/2012 4/1/2012 7/1/2012 Quarter But there is still a large faction of consumers who either will not or cannot purchase a new vehicle and the number of used vehicles demanded by this group of individuals will continue to grow along with the economy. To put things another way, the subtly rising economic tide should continue to support the release of demand for both new and used vehicles near-term. 9

10 New Model Spotlight: Scion FR-S & Subaru BRZ This past marked the beginning of a new unique joint venture between Subaru and Toyota as the BRZ and FR-S (launched under the Scion brand) no-frills sports coupes went on sale here in the States. For those unfamiliar with these models, the formula is brilliant and yet simple at the same time. Two door coupe, 2+2 seating, rear-wheel drive, 2.0-liter boxer four cylinder producing 200 horsepower, all starting for under $24,500. Subaru offers the BRZ in two flavors, Premium which has a base MSRP of $24,495 and Limited which starts at $27,495. Automatic transmission is available on each trim but will cost you an additional $1,100. In terms of gadgetry, the Premium already comes well optioned and includes standard navigation with Bluetooth phone and audio capabilities. Optioning up to the Limited trim will get you leather/alcantara trimmed seats, keyless entry and start, rear spoiler, and fog lamps. The Scion FR-S only comes in one trim level, and unfortunately leather/alcantara seats are not an option, although the FR-S does come in a couple hundred dollars less at $24,200 in regards to initial MSRP. Unlike the BRZ this price does not include standard navigation. In order to option up to the standard Premium BRZ level buyers will have to check the accessory box for the $845 Be- Spoke premium audio system, putting the similarly equipped FR-S model at a MSRP of $25,045 or $550 more than the BRZ Premium. Similar to the BRZ automatic transmission will also cost you $1,100 on the FR-S. When shopping for a new BRZ or FR-S, expect to pay close to MSRP because currently there are little to no incentives available on either vehicle. In the case of the BRZ, June-August average incentive spending came in just under $400, which is over $2,000 less than the current market average. Scion is currently doing even better. So far in its first four months on sale the FR-S has had no incentive offers whatsoever. By controlling incentives, short term value retention for both the BRZ and FR-S should remain very strong. So far things are looking great for each brand as -August sales for the BRZ totaled 2210 units and an even better 6332 units for the FR-S. During the month of y, the FR-S outsold the BRZ by 48 units per day, or 71 units a day for the FR-S compared to 23 for the BRZ. In regards to current supply, August month-end days supply for the BRZ was 30 days while the FR-S came in at an even lower 18 days. To put things in perspective, a healthy industry average days supply is around 60 days, showing that both Subaru and Toyota need to ramp up production to keep up with demand for the hot selling new coupes. On the new sales side, JD Power data collected over the months of -August shows that the BRZ Premium model has been selling at an average price of $27,215, while the more upscale BRZ Limited has been fetching an average of $29,329. This equates to transaction prices of $2,720 above base MSRP for the Premium model and $1,834 for the Limited model. Looking at FR-S data shows that much of the same is occurring in terms of new transaction prices as during this same period the average transaction price has been $26,357, or $2,157 above base MSRP. This premium over MSRP can most likely be attributed towards the addition of optional equipment such as automatic transmission or port installed extras such as the BeSpoke premium audio system. In addition, the presence of low supply and high demand creates the perfect justification for dealer imposed market adjustments which will also cause new transaction prices to trend higher than base MSRP. Looking ahead to first time used vehicle values and overall value retention, both the BRZ and FR-S should perform towards the top of their class. Right now high demand, low inventory, and low incentives levels will keep used values high, the only thing that could hurt short term retention is if one of these variables changes dramatically in the near future. 10

11 Jan-11 Feb Apr Jun Aug Sep Oct Nov Dec Jan-12 Feb Apr Jun Jan-08 Sep Nov Jan-09 Sep Nov Jan-10 Sep Nov Jan-11 Sep Nov Jan-12 ATD/NADA Official Commercial Truck Guide Update ket Stable, Model Year Trends Developing Retail pricing for the sleeper market overall rose unexpectedly in y, but this rise was not supported by newer model years. Trucks newer than four model years old continue to gradually decline in price. The wholesale market returned a solid performance despite historically high average mileage. Sales volume per dealership was moderate for the third month in a row. y s results suggest a market remaining stable at a high level. Retail ket After a relatively flat first half, and in the face of mixed economic data, y s average pricing surprised on the upside. The average sleeper tractor retailed in y cost $50,077, had 557,314 miles, and was 75 months old (see graph). This result is 1.2% above June, with mileage 2.6% higher. Age was higher by one month. This was only the second month in the past four years in which price crested the $50,000 barrier. Compared to y of last year, this month s results were 5.2% higher on price, and 7.7% higher on mileage. Trucks sold in y of last year were six months younger. Late-model trucks, particularly the 2009 and 2010 model years, have trended moderately downwards. This behavior is to be expected for the newest model years as they enter the market in greater numbers (see ly Retail Sales Volume graph). At the same time, anecdotal evidence suggests a degree of resistance to DPF-equipped trucks in regions not directly impacted by port-related emissions regulations. Overall, 2009 s continue to command strong money, and we do not foresee any change in pricing other than continued mild depreciation. Slightly older trucks have followed a different pattern s have enjoyed steady pricing since February after declining throughout And the 2007 and even 2006 model years have not depreciated notably in at least 18 months. It is likely that the market has established a comfort level for the last of the pre-dpf trucks. Bottom line trucks with under 600,000 miles that meet trade terms will bring strong money, regardless of age. See the Average Retail Price by Model Year graph for detail. $55,000 $50,000 $45,000 $40,000 $35,000 $30, Average Retail Price and Mileage: All Sleeper Tractors Under 1M Miles Source: NADA ly Retail Sales Volume by Model Year: Sleeper Tractors Under 1M Miles 2 per. Mov. Avg. (Price) 2 per. Mov. Avg. (Mileage) 580, , , , , , , , , ,000 2 per. Mov. Avg. (2006) 2 per. Mov. Avg. (2007) 2 per. Mov. Avg. (2008) 2 per. Mov. Avg. (2009) 2 per. Mov. Avg. (2010) Source: NADA 11

12 39448 Sep Nov Sep Nov Sep Nov Sep Nov Commercial Truck Guide Update (continued ) Wholesale ket Wholesale pricing for sleeper tractors remains predictable, tied tightly to mileage. The average sleeper tractor wholesaled in y cost $30,014, had 680,041 miles, and was 96 months old (see graph). This result is 12.8% higher than June, with mileage 1.7% lower. Age was identical to June. Compared to y of last year, this month s results were 11.8% higher on price, and 8.2% higher on mileage. Trucks sold in y were a whopping 20 months older than the same month year. With a correlation between price and mileage since January, we can fairly accurately predict where pricing will fall at a given mileage point. y s result was on the high side of what we would expect given the average mileage. The rule of thumb of trucks with under 650,000 miles performing well in the wholesale market may need to be revised upwards 5% or so. Sales Volume y s results were nearly identical to June s, at 5.9 trucks retailed per dealership rooftop (see graph). The second quarter of this year was weaker than the same period last year by 0.4 trucks per dealership or 6.7%. The decrease is attributable mainly to supply factors namely, a lack of low- to averagemileage iron to sell. At the same time, the demand side can t be overlooked. The mild contraction in the manufacturing sector and the extremely cautious investment environment are probably having some impact. But market appetite for any truck with under 600,000 miles indicates that the demand side is the lesser of the two factors. Conclusion After mixed results in and June, we had considered y a critical month that would determine whether the market was in decline or just flattening out. Average Retail Price by Model Year - All Sleeper Tractors Under 1M Miles Adjusted for Mileage $100,000 $90,000 $80,000 $70, $60, $50, $40, $30,000 $20,000 $10,000 Source: NADA $0 Average Wholesale Selling Price: All Sleeper Tractors Under 1M Miles per. Mov. Avg. (Price) Source: NADA 2 per. Mov. Avg. (Mileage) Average Number of Retail Sales per Rooftop (NADA Reporting Dealers) Source: NADA

13 Commercial Truck Guide Update (continued ) With late-model tractors continuing their gradual decline, pre-dpf iron holding steady, predictability in the wholesale markets, and little change in sales volume, we consider the used truck market stable. Mixed domestic manufacturing activity and the ongoing political circus will ensure that business investment remains extremely conservative through the end of the year. However, we maintain that the low supply of low- to average-mileage used trucks will continue to support high pricing levels well into Be sure to check our Commercial Vehicle Blog every few days at for real-time updates on this and other data. 13

14 New Vehicle SAAR (millions) Average Incentive Spending Sales Volume (millions) Days of Supply New Vehicle Data New Vehicle Sales New Vehicle Days' Supply New Vehicle Sales YoY Change 30% 25% Days' Supply YoY Change % 15% 10% Percent Change Day Change % % 0-15 Source: Wardsauto.com Source: Wardsauto.com New SAAR Incentives 15 Days' Supply YoY Change 25% $2,750 $2,700 Average of Total YoY Change 12% 10% % 15% 10% 5% Percent Change $2,650 $2,600 $2,550 $2,500 $2,450 $2,400 $2,350 8% 6% 4% 2% 0% -2% Percent Change $2,300-4% 11 0% $2,250-6% Source: Wardsauto.com Source: Autodata Mainstream Brand Performance (Units Sold) Change From Aug Aug-11 Ago Year Ago Buick 18,000 14,391 16,021 25% 12% Chevrolet 169, , ,779 22% 11% Chrysler 28,070 20,792 22,497 35% 25% Dodge 73,413 60,028 63,903 22% 15% Fiat 4,150 3,710 3,106 12% 34% Ford 188, , ,794 13% 13% GMC 37,838 34,487 36,471 10% 4% Honda 115, ,119 73,267 11% 58% Hyundai 61,099 62,021 58,505-1% 4% Jeep 42,839 41,559 40,613 3% 5% Kia 50,028 48,074 41,188 4% 21% Mazda 22,234 19,318 22,632 15% -2% Mini 5,718 5,855 3,109-2% 84% Mitsubishi 4,249 4,194 7,985 1% -47% Nissan 87,360 86,722 82,517 1% 6% Scion 7,722 6,904 3,649 12% 112% Smart % 86% Subaru 28,293 25,183 20,837 12% 36% Suzuki 1,968 2,266 2,409-13% -18% Toyota 156, , ,730 12% 45% Volkswagen 41,011 37,014 25,232 11% 63% Luxury Brand Performance (Units Sold) Change From Aug Aug-11 Ago Year Ago Acura 15,646 12,825 9,054 22% 73% Audi 11,527 11,707 10,201-2% 13% BMW 16,835 21,297 20,815-21% -19% Cadillac 14,704 13,417 13,208 10% 11% Infiniti 11,155 11,619 9,024-4% 24% Jaguar 1,029 1, % 27% Land Rover 3,727 3,320 2,807 12% 33% Lexus 24,237 18,235 18,103 33% 34% Lincoln 8,141 6,975 8,006 17% 2% Mercedes-Benz 22,686 21,515 20,316 5% 12% Porsche 3,026 2,803 2,184 8% 39% Volvo 6,323 5,717 5,215 11% 21% Source: IHS/Global Insight 14

15 Home Price Index (Aggregate Jan. 2000=100) All Items (% Change) Retail and Food Service Sales (% Change) Diffusion index, SA Change in Nonfarm Payrolls (ly, Ths.) Index Value Economic Data Employment Total Nonfarm Payrolls & Unemployment Rate, SA Nonfarm Payroll Change Unemployment Rate Unemployment Rate (%) Consumer Confidence Index Source: BLS Source: The BLS Conference Board Retail Sales Retail & Food Service Sales, SA Industrial Production Purchasing Manager's & Inventories Indices 15% Retail/Food Service Sales YoY Retail/Food Service Sales MoM 65 Purchasing Manager's Index Inventories Index 10% % 50 0% % 35-10% % 20 Source: U.S. The BLS Conference Census Bureau Board Source: Institute for Supply Management Housing S&P/Case-Shiller Home Price Index (20-Metro Composite) & Housing Starts (Total Private) Consumer Price Index (CPI) All Items 250 Home Price Index Housing Starts 2,500 6% All Items YoY All Items MoM 5% 200 2,000 4% ,500 1,000 Housing Starts (Ths. SAAR) 3% 2% 1% 0% % -2% 0 0-3% Source: S&P Case-Shiller, U.S. Census Bureau Source: U.S. Bureau of Labor Statistics 15

16 Average Price Average Price Fuel Price Data Regular Grade Gasoline Prices (all formulations) $4.00 Average Price Per Gallon $3.90 $3.80 $3.70 $3.60 $3.50 $3.40 $3.30 $3.20 $3.10 $3.00 $2.90 $ YoY Change $1.00 $0.80 $0.60 $0.40 $0.20 $0.00 ($0.20) ($0.40) Price Change Source: EIA On-Highway Diesel Fuel Prices $4.20 Average Price Per Gallon $ YoY Change $1.00 $4.10 $0.80 $4.00 $0.60 $3.90 $3.80 $0.40 $0.20 Price Change $3.70 $0.00 $3.60 ($0.20) $3.50 ($0.40) Source: EIA U.S Regular Gasoline Prices (dollars per gallon, all formulations) Change From Aug Aug-11 Ago Year Ago US $3.72 $3.44 $3.64 $0.28 $0.08 East Coast $3.68 $3.41 $3.66 $0.28 $0.02 Midwest $3.78 $3.44 $3.64 $0.34 $0.13 Gulf Coast $3.51 $3.22 $3.52 $0.29 ($0.01) Rocky Mountain $3.52 $3.52 $3.54 ($0.00) ($0.02) West Coast $3.94 $3.70 $3.73 $0.24 $0.21 Source: EIA U.S On-Highway Diesel Fuel Prices (dollars per gallon) Change From Aug Aug-11 Ago Year Ago US $3.98 $3.72 $3.86 $0.26 $0.12 East Coast $3.97 $3.77 $3.89 $0.21 $0.08 Midwest $3.97 $3.68 $3.84 $0.29 $0.13 Gulf Coast $3.88 $3.64 $3.82 $0.24 $0.05 Rocky Mountain $4.00 $3.70 $3.84 $0.30 $0.16 West Coast $4.18 $3.84 $3.92 $0.34 $

17 NADAguides.com Consumer Site Trends New Activity About NADAguides.com NADAguides.com is the most comprehensive vehicle information website on the internet today, offering a broad range of information and services to help educate consumers in the market to buy, sell, trade, or simply shop for a vehicle. NADAguides is an alliance partner of NADA Services Corporation. The figures contained below are based on consumer activity at and are calculated by measuring the number of unique lookups for a given period of time. YoY Change in Consumer Activity: NEW Make Jeep 67% Subaru 45% Volkswagen 43% Scion 38% MINI 33% Audi 32% Land Rover 31% Dodge 27% Acura 25% Lexus 25% Mercedes-Benz 25% Mazda 24% Chrysler 24% Ford 23% Chevrolet 18% Infiniti 17% Porsche 16% Honda 13% GMC 13% Nissan 11% Toyota 9% Volvo 6% Hyundai 5% Jaguar 5% Kia 4% Mitsubishi 1% Buick 0% Suzuki -1% Cadillac -6% Lincoln -10% Saab -16% BMW -29% -40% -20% 0% 20% 40% 60% 80% Source: NADAguides.com Percent Change New: Top 15 Researched Models August 2012 August 2012 Rank MoM Change MY MAKE MODEL Ford F Chevrolet Silverado Chevrolet Captiva Sport Fleet Toyota Camry Ford F (1) 2012 Ford Focus 7 (1) 2012 Honda CR-V 8 (1) 2012 Nissan Altima Ram Truck (1) 2012 Chevrolet Equinox Honda Accord Sdn 12 (1) 2012 Toyota Tacoma Jeep Grand Cherokee 14 (1) 2012 Ford Mustang Hyundai Sonata New: Top 15 Researched Models August 2011 August 2011 Rank MY MAKE MODEL BMW 5 Series Chevrolet Silverado Ford F Toyota Camry Hyundai Sonata Toyota Tacoma Chevrolet Equinox Kia Sorento Honda Accord Sdn Chevrolet Camaro Jeep Grand Cherokee Honda CR-V Ford Mustang Chevrolet Cruze Nissan Altima 17

18 NADAguides.com Consumer Site Trends Used Activity YoY Change in Consumer Activity: USED Make Saab Subaru BMW Volvo MINI Hummer Jaguar Audi Honda Lincoln Land Rover Mercedes-Benz Acura Volkswagen Chevrolet Lexus Buick Ford Toyota GMC Pontiac Cadillac Infiniti Mercury Jeep Suzuki Dodge Mitsubishi Chrysler Scion Mazda Porsche Nissan Kia Hyundai Saturn -6% -6% -7% -2% -2% 0% 0% -1% -1% -1% -1% 1% 1% 0% 0% 3% 3% 3% 2% 2% 2% 2% 1% 6% 6% 5% 5% 9% 9% 9% 8% 7% 6% 13% 11% 16% Source: NADAguides.com -10% -5% 0% 5% 10% 15% 20% Percent Change Used: Top 15 Researched Models August 2012 Used: Top 15 Researched Models August 2011 August 2012 Rank MoM Change MAKE MODEL 1 0 Ford F Chevrolet Silverado Nissan Altima 4 1 Toyota Camry 5 1 Chevrolet Impala 6 (2) Honda Accord Sdn 7 0 Dodge Ram Ford Mustang 9 1 Toyota Corolla 10 (1) Ford Escape 11 0 Chevrolet Tahoe 12 1 BMW 3 Series 13 2 Ford Focus 14 2 Chevrolet Silverado 2500HD 15 (3) Chevrolet Malibu August 2011 Rank MAKE MODEL 1 Ford F Chevrolet Silverado Nissan Altima 4 Toyota CAMRY 5 Dodge Ram Chevrolet Impala 7 Honda Accord Sdn 8 Ford Mustang 9 Toyota Corolla 10 Ford Super Duty F Chevrolet Tahoe 12 Ford Escape 13 Ford Focus 14 Jeep Wrangler 15 Chevrolet Cobalt 18

19 Percent Change Percent Change AuctionNet Wholesale ket Trends About AuctionNet AuctionNet is an industry-unique wholesale transaction database, available exclusively from NADA Used Car Guide, in joint partnership with the National Auto Auction Association (NAAA). Over 100 million records strong and updated weekly, it captures sales from all Manheim and ADESA, as well as participating ABC, ServNet and large independent auctions, representing over 80% of nationwide auction activity. ly AuctionNet Price Change - y v. August, 2012 Vehicles 1-to-5 years in age, mileage and mix adjusted. 0.0% -0.5% -0.3% -1.0% -0.6% -0.8% -0.8% -1.5% -1.4% -2.0% -2.5% -1.9% -2.4% -2.2% -2.1% -1.8% -3.0% -3.5% -4.0% -4.5% ket Compact Car Compact Utility Mid-Size Car Mid-Size Utility Segment Mid-Size Van Large Pickup Large SUV Luxury Car Luxury Utility Source: NADA Annual AuctionNet Price Change - August '11 v. August '12 Vehicles 1-to-5 years in age, mileage and mix adjusted. 6.0% 5.4% 4.0% 2.8% 2.0% 1.7% 0.0% -2.0% -1.7% -2.2% -2.1% -4.0% -3.2% -6.0% Source: WardsAuto.com NADA -4.7% ket Compact Car Compact Utility -4.4% Mid-Size Car Mid-Size Utility Segment -4.5% Mid-Size Van Large Pickup Large SUV Luxury Car Luxury Utility 19

20 NADA Guidebook Value Trends -Over- ly Change in Average NADA Official Used Car Guide Value: NADA Segment August 2012 v. September 2012 NADA Segment 2007MY 2008MY 2009MY 2010MY 2011MY* Compact Car -3.4% -3.5% -3.1% -2.6% -2.0% Compact Utility -2.8% -2.5% -2.2% -2.0% -1.9% Large Pickup -1.3% -0.7% -0.5% -0.3% -0.6% Large SUV -1.1% -1.5% -1.1% -1.0% -0.3% Luxury Car -3.1% -2.6% -2.8% -3.5% -2.8% Luxury Utility -1.7% -2.5% -2.5% -2.3% -2.7% Mid-Size Car -4.2% -3.7% -3.5% -3.4% -2.8% Mid-Size Utility -3.4% -2.6% -1.6% -1.9% -1.6% Mid-Size Van -4.8% -4.1% -3.7% -2.3% -2.6% *Value movement can be influenced by newly valued vehicles. See the last page of "Guidelines" for data key. ly Change in Average ATD/NADA CTG Value: NADA Segment August 2012 v. September 2012 NADA Segment 2006MY 2007MY 2008MY 2009MY 2010MY* Commercial Van 0.0% 0.0% 0.0% 0.0% -0.4% Extended Hood -0.5% -0.1% -1.3% -2.3% -2.0% Highway Aerodynamic 0.0% 0.3% -0.5% -0.3% -0.6% Highway Traditional -0.4% -0.1% -1.5% -2.1% -3.0% Local/Delivery Daycab -0.1% -0.2% -0.4% -0.7% -1.5% Medium Duty Cabover 0.0% 0.0% 0.0% 0.0% 0.0% Medium Duty Conventional 0.0% -1.5% 0.0% 0.0% 0.0% Vocational/Construction 0.0% 0.0% 0.0% 0.0% N/A *Value movement can be influenced by newly valued vehicles. See the last page of "Guidelines" for data key. 20

21 NADA Guidebook Value Trends Year-Over-Year Annual Change in NADA Official Used Car Guide Value: September, 2011 v NADA Segment 5YR 4YR 3YR 2YR 1YR YoY Segment Change Compact Car -2.8% -1.5% -4.8% -1.2% -5.5% -3.8% Compact Utility 0.0% 0.7% -2.4% 0.2% -2.5% -2.2% Large Pickup 14.4% 8.7% 7.7% 3.5% 7.1% 6.7% Large SUV 30.9% 14.4% 6.6% 2.3% 3.1% 7.3% Luxury Car 6.5% 3.8% -1.1% 1.3% -2.2% 2.4% Luxury Utility 4.2% 0.0% 2.6% 3.0% -5.4% -2.1% Mid-Size Car 0.7% 1.5% 12.7% -0.7% -4.6% 1.4% Mid-Size Utility 7.1% 4.7% 3.5% 2.7% -0.9% 1.0% Mid-Size Van -4.8% 9.9% -2.8% -4.9% 1.5% 4.1% *Calculations are based on vehicle age, i.e. values for 1 year old vehicles in CY2011 are compared against values for 1 year old vehicles in CY2010. Annual Change in ATD/NADA Commercial Truck Guide Value: September, 2011 v NADA Segment 5YR 4YR 3YR 2YR YoY Segment Change Commercial Van 15.4% 17.9% -20.6% 9.4% 2.4% Extended Hood 15.9% 26.0% 3.4% -6.2% 6.0% Highway Aerodynamic 7.7% 35.3% 8.7% 2.1% 8.2% Highway Traditional 17.8% 24.5% 4.0% 1.2% 11.3% Local/Delivery Daycab 21.9% 38.0% 10.0% 2.8% 10.3% Medium Duty Cabover 15.2% 11.4% -5.0% N/A 3.9% Medium Duty Conventional 25.8% 27.2% 15.3% -1.0% 12.6% Vocational/Construction 20.0% 38.8% 7.4% N/A 13.6% *Calculations are based on vehicle age, i.e. values for 1 year old vehicles in CY2010 are compared against values for 1 year old vehicles in CY

22 NADA Guidebook Value Trends Year-To-Date YTD Change in NADA Official Used Car Guide Value: January Sept 2012 NADA Segment 2007MY 2008MY 2009MY 2010MY 2011MY* YTD Segment Change Compact Car -7.0% -7.3% -6.0% -5.0% -6.2% -6.1% Compact Utility -12.0% -11.3% -10.8% -8.7% -7.7% -9.5% Large Pickup -6.5% -6.7% -3.7% -3.1% -3.2% -4.5% Large SUV -5.3% -5.7% -4.2% -3.6% -4.1% -4.4% Luxury Car -11.0% -10.1% -11.7% -11.5% -9.7% -10.0% Luxury Utility -13.4% -12.8% -14.3% -12.4% -10.3% -12.3% Mid-Size Car -6.6% -5.9% -5.9% -4.7% -6.4% -5.9% Mid-Size Utility -12.5% -10.9% -8.9% -8.1% -7.5% -9.3% Mid-Size Van -15.7% -12.3% -12.9% -11.0% -9.6% -11.8% YTD Change in ATD/NADA Commercial Truck Guide Value: January Sept 2012 NADA Segment 2006MY 2007MY 2008MY 2009MY 2010MY* YTD Segment Change Commercial Van -10.4% -8.5% -13.3% -1.9% 2.0% -7.1% Extended Hood 0.1% 1.7% -6.9% -14.9% -11.2% -4.7% Highway Aerodynamic -5.0% -4.0% -10.4% -12.4% -10.9% -8.5% Highway Traditional 0.9% 3.5% -6.1% -11.3% -12.2% -3.6% Local/Delivery Daycab 0.4% 0.4% -5.9% -8.4% -10.7% -5.4% Medium Duty Cabover -11.1% -6.3% -3.6% -5.3% N/A -4.7% Medium Duty Conventional -1.3% -4.9% -2.5% -7.1% 0.8% -1.1% Vocational/Construction 0.0% 0.0% -4.3% -4.2% N/A 1.8% 22

23 At NADA Used Car Guide NADA ket News NADA has added a Certified Pre-Owned (CPO) valuation to its used vehicle retail value effective September 1, Business professionals now have a guide to the typical premium added to the retail value when a given vehicle is initially sold by a franchised dealer under a manufacturer s certification program. NADA guidebooks and select online products will include the CPO value as an ADD in the Optional Equipment listing to the Retail value only. The CPO premium takes into account the warranty extension provided for the vehicle as well as the vehicle meeting the individual CPO program requirements of multi-point inspection, minimum age, maximum mileage, etc. For more information on CPO values go to NADA s most recent white paper titled Volatility in Used Vehicle Depreciation: Historical Trends & Future Outlook provides insight into how and why used vehicle depreciation has changed in the past, and gives background on the prediction that overall market depreciation will increase mildly over the next few years. If you are interested in downloading a copy of the latest NADA white paper, please visit our web site at On the Road Don t miss the National Auto Auction Association (NAAA) Annual Conference in Orlando, FL from October 1 st through 5th. CONTACTS: Financial Industry/ Accounting/ Legal/OEM Captive Steve Stafford x7275 sstafford@nada.org Credit Unions, Fleet/Lease/ Rental Industry, Government Doug Ott x4710 dott@nada.org Automotive Dealers/Auctions, Insurance Jim Dodd x7115 jdodd@nada.org Automotive OEMs Stu Zalud x4636 szalud@nada.org Business Development Manager Jim Gibson x7136 jgibson@nada.org Director Sales and Customer Service Dan Ruddy x4707 druddy@nada.org About NADA Used Car Guide Over a 79-year history, NADA Used Car Guide has earned its reputation as the leading provider of market-reflective vehicle valuation products, services and information to businesses throughout the U.S. and worldwide. NADA s editorial team collects and analyzes over one million combined wholesale and retail automotive-related transaction prices per month. Its guidebooks, auction data, analysis, and data solutions offer automotive, financial, insurance, and government professionals the timely information and reliable solutions they need to make better business decisions. Visit Director Public Relations Charles Cyrill (mobile) ccyrill@nada.org Disclaimer: NADA Used Car Guide makes no representations about future performance or results based on the data and the contents available in this report ("Guidelines"). Guidelines is provided for informational purposes only and is provided AS IS without warranty or guarantee of any kind. By accessing Guidelines via or the NADA website, you agree not to reprint, reproduce, or distribute Guidelines without the express written permission of NADA Used Car Guide.