True, used-car prices have surged. You may be able to make that work in your favor.
With unrelenting demand and limited inventory for both new and used autos, you won’t find much wiggle room in the prices you see. The good news for consumers, though, is that dealerships are paying more for used models — which you may have sitting in your driveway.
“So many dealers are saying ‘We want used cars,’” said Ivan Drury, senior manager of insights at Edmunds.com.
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An ongoing global shortage of microchips — key components needed for today’s autos to operate — has impacted manufacturers’ production of new vehicles, which has translated into demand outpacing supply. The result has been fewer discounts being offered across the board, with some autos selling for more than sticker price, and demand spilling over to the used-car market.
“As is always the case, the new car and used-car markets are tied,” said Joe Wiesenfelder, executive editor of Cars.com. “High prices in one affect the other, and that’s where we are.”
The average amount for a used vehicle has jumped more than 21% to about $25,400 from $20,900 a year ago. For new cars, buyers are paying roughly $40,800, up about 4.9% year over year.
“It’s difficult to gauge how long it will take for things to improve,” Wiesenfelder said. “All of this relies on new-car inventory returning to healthier levels.”
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While dealerships aren’t offering much in the way of discounts or negotiating as much on prices as they have before now, trade-in values for trucks are “through the roof” and car trade-ins are high, as well, said Barry Stoler, president of Len Stoler Automotive Group.
“What [buyers] lose on discounts they gain on the trade-in, because those values are so high,” Stoler said.
Even vehicles with higher mileage may fetch more than you think. The average amount paid for autos with mileage between 100,000 and 109,999 hit $16,489 in June, compared with $12,626 a year ago (a 31% jump), according to data from Edmunds.