If you’re looking to buy or sell a used car, now may be the time.
Prices for pre-owned vehicles are finally starting to normalize even though there’s still a shortage of new cars.
General manager of McCarthy’s, Chris Wesney, said, “There’s still a big problem with the delays in the manufacturing of the microchips as well as a massive shipping problem.”
Earlier this year, the auto industry experienced a shortage of new vehicles due to a shortage of microchips. This forced many into the used car market causing a surge in prices.
Mike Cummings is a used car manager at Cole Chrysler Dodge and Jeep. “Kind of like the toilet paper thing with COVID. I just think it was panic. It was frenzied. I’d have 3 people on one car and they’d all want to buy it. I want in,” says Cummings.
According tot he U.S. Bureau of labor statistics, the average price of used cars inflated by nearly 20% in May.
“It was crazy. It didn't make any logical sense, but people were buying them because there were no vehicles,” said Cummings.
Now, demand for used cars have slowed down.
“As the news trickled down to the consumer that prices were high and the market was hot and that it was a sellers’ market, people have slowed down on their purchases, which has helped flatten that crazy curve we saw in the used car market,” Wesney said.
But that’s not to say pricing has reached pre-COVID levels.
“We see used car prices are kind of trending downward, but they’re not dropping to the floor. They’re not going down to the prices before the chip shortage,” said Cummings.
Local car dealerships say it’s still a good time to sell your car if you have a replacement, because they’re turning quick.
“Prices are still strong, but they’re not astronomically high. You can still get a great deal selling your used car, but you’re not going to pay an exorbitant price to buy another one,” said Wesney.
As the economy gets back to normal, consumers are expected to see prices stabilize not just in the used car market, but across all industries.