3 ms·
I feel like I understand a lot of the pandemic and post-pandemic demand spikes, but used cars elude me. Is it just people wanting new cars less, or less new car
by majormajor 5y ago
I feel like I understand a lot of the pandemic and post-pandemic demand spikes, but used cars elude me. Is it just people wanting new cars less, or less new cars being available?
- brianlweiner 5y agoTwo factors that I'm aware of: -- Early in the pandemic, travel was way down. Rental car companies unloaded a lot of their fleet that were sitting idle. Now that demand is back up, they are back on the market for vehicles. -- Semiconductor shortages: automobile manufacturers cut their orders in early 2020 anticipating a decline in demand. That decline never happened, so they're now now able to obtain sufficient chips for new vehicle manufacturing. Thus a decline in new car availability that might push some car-buyers onto the secondary market.
- jihadjihad 5y agoPart of what's driving the prices in used cars upwards is the inability to manufacture enough new cars to meet demand, which in turn is caused by a global chip shortage / volatile chip supply.
- deleted 5y ago[deleted]
- danans 5y ago> Is it just people wanting new cars less, or less new cars being available? Both. New cars are very expensive and most people can't afford them. The used car market is nearly 3x the size of the new car market (in cars sold, not $). Also, as cars have become more reliable many who would otherwise buy new are buying lightly used off-lease cars (i.e. certified pre-owned). Many people understand the instant depreciation hit that comes with a new car, and want to avoid it. Add to all that there is currently a supply chain issue for critical parts needed for new cars.