Used car demand and prices skyrocketing across the country
MONTGOMERY COUNTY, Pa. - Used cars are being sold at higher prices due to an increase in demand and low production of necessary auto parts.
Dean Cafiero, CarVision Inc. president and owner, is working to keep inventory stocked at his dealership.
The used car market is driving higher and higher, meaning they may be worth a lot more than they were just months ago.
"The price per car has gone up between 4 and $5,000 from normal times, per car." Cafiero said.
Mclain says that CarVision usually keeps 60 to 70 cars in their lot, but now, says they’re lucky if to have 30 to 35 cars right now.
"Inventory is a big problem when it comes to finding and sourcing used cars," said Cafiero.
Credible.com personal finance expert Dan Roccato says that production shortages are to blame.
"Yeah, so it’s basic supply and demand and the supply is way down and demand is up. So supply and demand means prices are up," Roccato said.
Right now, there’s a shortage of semiconductor chips, which are the tiny computer chips that control all those sensors on new cars.
"The pandemic has disrupted the supply chain whether that's chips or other components, so there's just not a lot of new car inventory for buyers to choose from," Roccato said.
Pricing is also an issue, according to Roccato.
"Cars are crazy expensive. Average price is $40,000 people can’t afford that. We’re keeping our cars longer, the average car on the road is 12-years old," he said.
Now that cars are being sold for more, this is the best time to let go of an extra vehicle, experts say.
"We’re buying a lot of cars from dealers, we’re buying a lot of cars from customers trying to sell cars," said Cafiero. if you have a trade in, your car is also worth more than in ordinary times."
There are also options for affording or waiting for a new car if there’s any trouble.
"The next thing you might want to consider is you may want to buy out your lease, so in many cases you’re buying it low and flip it for a higher price," Cafiero said.
Experts project that there may be more cars available to buy in the fall. Cafiero suggests holding on to them until the market steadies. For now, take care of your car and keep it well maintained, just in case.
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