The price of used cars is up and because of the pandemic the production of new cars is down.
KNOXVILLE, Tenn. — If you’ve been in the market for a new or used car, chances are pickings are slim. The demand has been high.
The price of used cars is up, and because of the pandemic, the production of new cars is down.
If you’re headed to buy a car, new or used, you’re going to want to do some digging before you go.
Research shows used cars are a hot commodity. According to Edmunds.com, the average price of used cars shot up 16% in July.
More people are wanting to avoid public transportation or rideshares.
Extra stimulus money and money saved up from not traveling or going out to eat has also allowed many to buy easily.
As for new cars, even though production is back up and running, the University of Tennessee professor Lance Saunders said it’s going to be a while before lost time is made up.
“Pretty much every supply chain, you name the product whether it’s toilet paper or cars, all of them got disrupted,” he said.
Fewer cars on the lot may mean you might not be walking out with what you were hoping for.
“COVID threw everything we knew about balancing that supply and demand out the window. You look at cars with factories shut down so that hurt the supply of new cars,” said Saunders.
Both new and used sales are down about 20% compared to last year, but those sales are making a comeback after being down earlier this year.
“It’s going to take time and they’re just weathering the storm to get through it. When you think about why it’s taking so long to catch up it makes sense,” he said.
So if you’ve got a car to trade in, research shows now is the time and if you’re buying be patient.
In June, franchised car dealers sold 1.2 million used cars and trucks. It was the highest monthly total since at least 2007.