Why has the used vehicle market been so expensive recently?

January 18th, 2022 by

If you have been shopping for a used vehicle, you probably noticed that there has been a price increase.

Used car prices have risen to unheard levels, in some cases surpassing their original MSRP. How is this possible?

The answer lies with the current COVID-19 pandemic.

COVID-19 drove a rise in the used vehicle market

The used car market depends heavily on a regular supply of vehicles. Usually, this isn´t an issue because people continually sell their cars to buy newer ones.

However, when people aren’t buying new vehicles but instead keep their old ones, fewer used vehicles are available for sale, which causes the cost to skyrocket due to this reduced inventory.

This is essentially what we are witnessing now, as the COVID-19 pandemic has impacted the used car market by doing the following:

First, It caused a supply chain shortage that has forced manufacturers to produce fewer new cars, increasing the cost and discouraging people from buying new vehicles.

Secondly, it has caused high levels of unemployment and financial anxiety, which in the end motivates people to buy them or simply forces them to keep their old vehicles until the economy has stabilized.

These factors combined lead to one result: there are now more people than before looking for used vehicles, but there are less of them available.

With this in mind, it is not surprising to see an increase in their market since it is normal to occur when demand exceeds supply. Thankfully, this appears only temporary as things slowly go back to normal before the pandemic.

Let House Of Cars Lethbridge Help You!

If you are having trouble finding the right used vehicle, you should contact House of Cars Lethbridge.

Because we have locations across Alberta, we have a larger selection than most used dealers. We are also most sellers’ number one option, meaning we have a constant flow of used vehicles to choose from.

We are also able to work with our customers by offering them customizable financial plans that are within their budget and tailored to their needs.

Out of the many used cars dealers in Lethbridge, we can assure you we are the ones you can count on for all your used vehicle buying needs.

Contact Us Today!

Posted in Finance