DETROIT — Used vehicle prices are forecast to fall more than previously expected this year, as high gas prices and broader inflationary costs hit Americans’ pocketbooks.

Cox Automotive on Wednesday lowered its forecast for the company’s Manheim Used Vehicle Value Index to increase 0.2%, down from 2%.

The lower forecast follows a 0.6% decline for the index in September, which marked the first time since early last year when the monthly index hasn’t been higher than a year earlier.

The historical average for the Manheim index is about a 2.3% year-over-year gain, but last year it was only up 0.4% after a historical run-up in prices during the coronavirus pandemic earlier in the decade.  

Non-adjusted wholesale used-vehicle prices fell 1.2% year over year in September and 1.3% from August as depreciation accelerated in the third quarter.

“The first half of the year actually showed more appreciation than usual, even in the face of higher fuel prices. But with the conflict in the Middle East ongoing, diesel prices at record highs, and interest rates climbing rapidly, increasingly worrying both businesses and consumers, wholesale prices have felt the sting,” Cox Automotive’s chief economist, Jeremy Robb, said in a release.

The index is a closely monitored gauge for used vehicle prices that tracks the pricing of used vehicles sold at Manheim U.S. wholesale auctions. Retail prices for consumers traditionally follow changes in wholesale costs.

Cox noted electric vehicle sales and off-lease volume continued to grow, reshaping used-vehicle market dynamics as EVs and smaller, fuel-efficient vehicle values increased during the quarter. That compares with poor performances of large trucks and SUVs, the company said.

The juxtaposition in smaller, fuel-efficient cars and larger vehicles occurred as the national average of gas in September was $4.33 per gallon. That was 50 cents higher than the previous September record of $3.83 set in 2023, according to AAA.

Cox said retail demand for used vehicles is relatively healthy, but the pricing changes seem to be signaling dealers have hit a ceiling on what they can charge consumers.

The average listed price of a used vehicle was $27,239 as of August, according to Cox. That compares with new vehicles at an average price of more than $50,000.

The majority of U.S. consumers purchase used vehicles since they’re more affordable than new models.