Used Cars Prices Are Now Increasing
Used car prices began to fall from virus outbreak highs in the latter part of 2022, then began to rise once more in January 2023. Prices for used cars fluctuate, rising in January after falling significantly during 2022. Throughout the epidemic, used automobiles were in high demand, but things appeared to have settled down last year. It’s difficult to predict what lies ahead, but we can at least make sense of the past.
What about the market for used cars right now?
Only ten days ago, it appeared like the pandemic’s utilized boom, accompanied by the corresponding increased prices, was “coming to a sudden end” as some used industries suffered a “brutal hangover.” “Americans, particularly those on tight incomes, are buying fewer vehicles as interest rates increase and recession concerns deepen. Furthermore, increased auto production has alleviated the scarcity of new automobiles. As a result, used car sales and prices are declining, and dealers that specialize in them are suffering.”
Used cars are selling out fast
In January, the daily sales conversion rate was likewise “above usual for the time of year,” at 59.4 percent. Before the pandemic, the daily sales exchange rate averaged 57.7 percent in January 2019. Manheim interprets this as “sellers [having] more price power than is customary for this time of year.” Other statistics show robust customer demand, with Manheim predicting that used sales volumes were up 16% in January versus December and up 5% year over year.
What future holds for used cars?
The downs and ups might have a simple cause. According to CNBC, “what we’re witnessing here is a basic game of supply and demand that permits both claims to be true. It is rightly observed that demand dropped in January, causing used car prices to fall. These decreased costs fueled new demand for used automobiles, resulting in the greatest gain in wholesale prices since late 2021”.