Good to see.

Rising used-car prices, which have been a big contributor to inflation over the past year, are starting to ease with dealers saying buyers are pushing back on what they are willing to spend.

During the pandemic, prices for preowned vehicles climbed 45%, hitting an average of $29,969 at the end of last year and rising faster than those for brand-new vehicles, according to data from research-firm Edmunds.

The climb has been driven in large part by a shortage of new vehicles, which have also surged in price and left buyers scrambling to find more affordable options. That has pushed many Americans to the used-car lot.

Used-car prices softened in the months heading into spring—usually a prime buying season in the auto industry with people getting tax refund checks. In April, the average price of a used car was $29,948, about $21 less than what it was in December, according to data provided by Edmunds.

2020
'21
'22
18,000
20,000
22,000
24,000
26,000
28,000
30,000
$32,000
“Affordability is certainly an issue,” said Jeff Williams, chief executive of America’s Car-Mart Inc. a chain of used-car retailers in the Midwest and South. “What we’re hearing from customers, and potential customers, is that prices are too high.”



The moderation comes as prices on new vehicles continued to climb last month, up 1.1% from March this year and 13.2% higher than in April 2021, according to the Labor Department’s consumer-price index. By comparison, government data showed prices for used cars and trucks fell by 0.4% in April.

Buyers are also paying more for other goods, such as groceries and air travel. Overall, inflation edged down to an 8.3% annual rate in April but remained close to the fastest pace in four decades, the Labor Department reported.

cross industries, companies have been charging more to offset rising costs. And while initially the price increases were met with little resistance, consumers are now holding off on making purchases in some areas.

Used-car prices were creeping up even before the Covid-19 health crisis. But the factory shutdowns in the early days of the pandemic, coupled with a parts shortage that hit later in the year, have left dealership lots stripped of inventory, pushing prices on both used and new vehicles to record highs.

Preowned-car buyers tend to be more price conscious, making the higher costs more difficult to swing, say dealers and executives. Consumers already are stretching out the loan periods to make monthly payments more affordable and moving down to older and older vehicles with lower price tags, they say.



Phil Maguire, owner of Maguire Family Dealerships based in Ithaca, N.Y., said he expects demand for used cars to remain elevated for the remainder of the year. But the high price tags are putting some customers in tough situations, and because of this, he said he is seeing used-vehicle sales soften in certain categories, such as larger SUVs and trucks.

“It’s just created this situation where we’re starting to see certain segments reach a peak,” Mr. Maguire said.

The average used-car loan in April carried a $544 monthly payment, up a full $100 from the same month a year ago and close to what a buyer would have spent on monthly payments for a brand-new vehicle at the start of the pandemic, according to Edmunds.

That payment equates to about 22% of the median personal income for an individual in April, up from about 18% five years ago, based on data from the U.S. Census Bureau and Edmunds.

As a result, more buyers are simply choosing to wait out the high prices by delaying purchase until costs come down, auto retailers say.

“Used vehicles are going to become less and less a story in this inflation environment,” said Jonathan Smoke, chief economist for Cox Automotive.

Retail sales for preowned cars dropped roughly 21% in April compared with the same year-ago period, according to data from industry research firm Cox Automotive. Contributing to the decline is a lack of used options, particularly at low price points that appeal to those on a tight budget, analysts and car retailers say.

Still, the dynamics of the car market remain fluid, and it is unclear how long this leveling off will last, given auto makers have experienced a series of unexpected supply shocks already that have prolonged the inventory crunch. And even with the moderation, used-car prices are still cruising at historic highs, and industry executives don’t see them coming down anytime soon.

For now, some car shoppers are finding a better deal buying new rather than used.

Joyce McClintock-Oberg, who visited a Subaru dealership in Michigan last month, said she was looking to buy a certified preowned SUV for her daughter. But the gap between that and a new one was only about $1,000, so she opted to purchase a new model instead.

“It just all seems pretty absurd to me,” Ms. McClintock-Oberg said. “If I could have saved significant money, I would’ve done that,” she said, of buying a used car.


link; https://www.wsj.com/articles/u...601?mod=hp_lead_pos7

There is going to be a flood of late model used cars on the market very soon. So it really won't matter that the new vehicles will be in short supply. All part of the plan.

quote:

Originally posted by old rugged cross:
There is going to be a flood of late model used cars on the market very soon. So it really won't matter that the new vehicles will be in short supply. All part of the plan.

I'm curious as to why there's going to be a flood of late model used cars on the market soon. I haven't seen or heard anything about this.

^^^ The economy. A friend of mine is in the repo business and he has seen business pick up the last 2 months.

quote:

So it really won't matter that the new vehicles will be in short supply. All part of the plan.

so does that mean more people will be able to afford living in a newer used car than before real peak market value?

"Flood of used cars" doesn't make any sense unless we are talking the survivors of family members selling off their loved ones vehicles. And by flood we're talking a million in multiples, which then implies a huge die off our our population? Now what could possibly cause that?

As for the prices coming down, I didn't see them going up much. Paid $4000 for an 05 F150, now 5 years later its gone DOWN, no appreciation. Most of this hype up market was for under 10 year old used - ie the suburban debt shopper market. They got free money and spent it - don't forget treated lumber, guns, pools and other disposable income purchases gutted the supply side of the markets. Priced windows lately? I have four more to go, I'm not doing them. The increase in cost stretched over the potential energy savings = burn pit. I don't throw my money away, but for sure, a certain part of America who has disposable income is.

How many paid off all their bills or even their house? Not so much.

Used cars were just another example of that bubble in our economy, and when it all depressurizes it will then be hyped as a massive deflation/depression. Like seeing AR's on the market go from $1,200 and in short supply, to marked down to $850 and free range tryouts. We saw that a few years back.

Its not the fixed income, frugal, or Amish causing it. It's McSuburbia. Possessions and scaling the ladder upward are their idols, living in a rotating debt cycle their entire life is their mantra. I have an example living next door - they can't go 6 months without trading in their "old dilapidated junker" for another new payment.

We are debt free and currently finishing a new pool install - its more than that - you got 10k gallons semi potable water handy? And I drive the same old '05 which I can jump start without breaking out the window. Same for my wifes '12. Keyed locks on the doors.

Observe the masses, do the opposite.

quote:

A friend of mine is in the repo business and he has seen business pick up the last 2 months.

That's the folks with shit credit that had enough for a down payment courtesy of the Gov't, that money ran out

It used to happen every year around tax season only

I'm not seeing a decline in used values, yet

Yeah, I don't see a flood of used vehicles happening this year.

quote:

Originally posted by BigSwede:

quote:

A friend of mine is in the repo business and he has seen business pick up the last 2 months.

That's the folks with shit credit that had enough for a down payment courtesy of the Gov't, that money ran out…

That’s not what he’s saying.

repossessed cars are in the rise in NY. You hear that Repo men are getting shot at. It’s the beginning to see a increase in Repos, bankruptcies and Foreclosures at lest in NewYorkistan!!
You know things are getting bad when you see TV ads I’d bloodsucking lawyers telling us they can stop foreclosure and Bankruptcies. Snakes.

I know some Repo men who never get shot at and they repo cars from sketchy areas. It is called social skills and knowing when to back off.

If they back off are they really repo men? Sounds like they are more correctly “do you mind if I take your car” guys. Lol

No he leaves with the truck. The guy is from down the bayou as they say and he just starts a conversation. He does not go in the middle of the night and cause all kinds of drama. Might even give the guy a beer. Most people understand what happens when they do not pay the car note.

For those few who are difficult he just leaves. It is a job and he does not get hazard pay. Gun battles and fist fight might make for good television but it is not reality.
These guys are similar to security in upscale casinos. Polite and nice gets the job done.