This is Why Used Vehicles Are Getting So Costly

The price of used vehicles is rising even quicker than new vehicles, and consultants are sounding the alarm.

“New automobile costs, outdated automobile costs, outdated used vehicles, trade-ins, I do not care what it’s. In the event you’re taking a look at a automobile as something, it’ll be costly,” Evan Drury, senior supervisor instructed Fox Enterprise’ Jeff Flock.

The automobile worth skilled just lately reacted to information from the US Division of Labor, which confirmed that the costs of used vehicles are about 40% greater than final yr. New vehicles are additionally up by 12 per cent.

“Nothing compares to what we’re seeing in at this time’s market,” Drury mentioned.

In accordance with information from Edmunds, the three-year-old Dodge Grand Caravan is price greater than $25,000 at this time — 69% greater than a yr in the past. The Nissan Versa of the identical age was priced at $9,842 final January, however has since grown 66% to a mean of $16,366.

Get able to spend more cash, consultants say, with costs not going to drop till the top of the yr.

At Barbera Autoland in Philadelphia, the 2019 Chevy Equinox had an MSRP of $26,700 when it first rolled out on the lot. The sticker worth is $29,984 at this time.

Increased costs are brought on by a world laptop chip scarcity, elevated labor and manufacturing prices, in addition to provide chain delays.

Specialists say that automobile costs are unlikely to drop by the top of 2022.
Corbis through Getty Pictures

“You possibly can even have 90 to 95% of this downside for manufacturing solely chips,” Durie defined.

Whereas some corporations like Ford have beforehand mentioned chip shortages may ease this yr, sellers do not count on costs to settle down till 2023.

“It is a seller’s market, it is a vendor’s market, and we have seen shoppers pay large premiums to purchase a automobile,” Mark Schirmer of Cox Automotive instructed Fox Enterprise.

“The costs of recent vehicles is not going to improve like they do, however we don’t count on a major fall within the costs of recent or used vehicles within the close to future,” he added.

FOX Enterprise’ Jiovanni Lieggi contributed to this report.

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