You’ve surely noticed the used car boom that took off at the very start of the pandemic. As everyone tried to keep six feet apart and many didn’t want to use public transportation, coupled with financial woes — used vehicle sales skyrocketed nationwide. Practically everyone was looking to buy a car! By April and May 2020, less new cars were available since car factories shut down. Then came the global chip shortage and challenged car production even more.
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Sales were down 31% for used vehicles one to three years old
According to Statista, 39.3 million used light vehicles were sold in the U.S. in 2020. But by March 2022, dealership price tracking app CoPilot reported sales of used cars (less than 10 years old) were down 27% compared with March last year. For used vehicles that are one to three years old, sales were down 31%. But still, iSeeCars stated prices by January 2022, on second-hand vehicles (from one-to-five years old) was $34,852— 36.9% more expensive than last year.
SEE ALSO: IN JANUARY, 82% OF CAR BUYERS PAID OVER STICKER PRICE
Average price of secondhand car goes up 40.5% in one year
When you take a look at a longer period of time, and consider the full year between January 2021 and 2022, the U.S. Bureau of Labor Statistics shows just how much the cost for secondhand cars went up. The consumer price index for used cars and trucks jumped up by 40.5%. In other words, within just 365 days, the average price of used vehicles have gone up by 40.5%.
In the very beginning of the year, the Toyota Highlander Hybrid took 30.9 days to sell
Higher prices at used car dealerships lead car buyers to take more time shopping and browsing. Today, the average time spent now is about 171 days — up 93% from 89 days in March last year. This means car dealership lots with 1-to-3-year-old secondhand cars should be returning to pre-pandemic vehicle inventory.
Auto production falls: 2.3 million cars and trucks less produced
But since the global chip shortage has put a serious dent in auto production, there are few to share among all dealers and car-buying customers. According to AutoForecast Solutions, the semiconductor shortage resulted in a loss of 2.3 million cars and trucks produced from January 2021 to March of 2022, with the potential for a loss of another 3.5 million vehicles
From 32.8 days to sell used vehicle in Sept. 2021 to 171 days now
iSeeCars conducted their own an analysis of over 900,000 dealership vehicles in September 2021. The findings? A used Mitsubishi Outlander took 19.7 days to sell to a registered driver. A second-hand Honda Insight took 21.2 days to get off a dealer lot. A used Toyota Highlander Hybrid and Kia Sedona took almost a full month. In short, during fall 2021 the average used car took 32.8 days to sell. Now, it’s 171! More than five times the time! Yes, used cars are still costing drivers a hefty price!
In January this year, the Tesla Model Y electric crossover was the fastest-selling car, with an average of 24.7 days to sell at an average price of $67,121
CoPilot cited on CNBC news, that before the pandemic, about 76% of vehicles sold for less than $25,000. Now, vehicles in that price range account for just 35% of inventory. But cars over the $40,000-mark represent 25% of what you can find on car dealer lots, compared with 5% in a typical year.
Used car pricing in your state 2022
The newest data we have for used car pricing is based on January 2022. iSeeCars ranked a few states to see where secondhand vehicles cost the most. Montana’ average cost for a used vehicle was $42,217. Wyoming’s average? $39,195. A driver in California looking for a used vehicle in the beginning of the year would need over $35,000 to get it off the lot. Connecticut’s average used car price was $30,652. Delaware had the smallest price bump; $7,714.
Analyzing over 280,000 new and used cars sold in January 2022, iSeeCars.com found the average new car takes 36.3 days to sell while a used vehicle takes 46.2 days
When studying the price change from 2021, Texas used car prices went up 32.3% in 2022. New Missouri secondhand vehicles went up 35.1%. For North Carolina drivers? Cost bumped 36.9%
The silver lining? Bloomberg reported a tiny drop in used car prices in the first week of April!