Have Used-Car Prices Peaked?

Lenders have been benefitting from strong used-vehicle prices all year. Higher-than-expected prices at auction have muted losses on repossessions and off-lease vehicles. GMAC and Ford Credit, among others, cited strong used-car values as part of the reason for their improved third-quarter earnings.

But in its Used-Vehicle Value Index released today, Manheim Consulting noted a slight decline in wholesale pricing. The October reading inched down to 117.4, from a record 118.5 in September.

Is this the beginning of a steady slide? Do lenders need to brace for lower auction values heading into 2010? Or might the dip be a normal decline, like the one Manheim reported at the end of 2008?

Here’s a look at the Manheim Used-Vehicle Value Index for the past year: