Of all the things people are shopping for right now — face masks, yeast, hand sanitizer, groceries — used cars are probably not on the top of many people's lists. Sure, there may be those looking to purchase a private mode of transportation or get out of a crowded city once and for all, but new data shows that, at least during the pandemic, people are not bringing their cars in for cash or trade.

That's certainly troublesome for CarMax ($NYSE:KMX), the largest used car dealership in America with an average annual car-sale volume of more than 600,000. And, until the pandemic, the dealership was experiencing one of its best years ever.

In February, inventory at CarMax began to slow. But the average vehicle price increased, in a sign that people were purchasing less-expensive cars, leaving the luxury vehicles to bring up the average price in overall inventory.

But in April, even as inventory picked up a bit, prices dropped. This could have been a sign of new, inexpensive vehicles added to CarMax's inventory, but since then the average price as also begun to dive.

We weren't the first to notice a dive in used-car prices. At Manheim, which includes dealer-only used-car auctions, used car prices dropped 34.4% in April. But what we're seeing here ar CarMax mirrors that drop in prices in the private marketplace. In short, we appear to be seeing people holding on to their cars on the supply side, and others not shopping at all on the demand side.

Price drops haven't affected all car makes equally, however. Luxury brands like Cadillac, BMW, and Mercedes are holding their values at Carmax despite dips in inventory.

Meanwhile, more mid-tier brands like Toyota and Honda have sagged in price along with their relative inventory counts.

This recent erosion in CarMax's staple brands is perhaps what of most concern here for the used-car market. If people aren't buying Toyotas and Hondas, a hold in price on its more expensive units isn't going to help in the short term.

CarMax began offering curbside, "handshake-free" car ordering and delivery as a way to move inventory. It also cut back on hiring as a way to improve fiscal headroom. These recent price drops may help move units, but it's pretty clear that, when it comes to shopping for used cars, consumers still see it as a largely in-person affair, and until CarMax lots open up again, the dealer (and others like it) is likely to have some tough times ahead.

About the Data:

Thinknum tracks companies using the information they post online - jobs, social and web traffic, product sales, and app ratings - and creates data sets that measure factors like hiring, revenue, and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales. 

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