Used car prices are surging again: Wholesale used vehicle prices rose +2.4% MoM and +2.4% YoY in January, to the highest since September 2023. This is well above the long-term average monthly decline of -0.2%. Non-EVs led the increase at +2.2% YoY, followed by luxury at +1.6% and EVs at +0.8%. This comes as wholesale supply dropped -5.1 days MoM, to 26.6 days. At the same time, sales conversion, or the percentage of vehicles sold at auction, surged +6.5 percentage points MoM to 60.7%, +3.2 percentage points above the 3-year average, indicating rising demand. With tax refund season expected to set a record, demand for used vehicles could push prices even higher. Used car inflation is heating up.(The Kobeissi Letter)