Broker Check
Used Cars

Used Cars

| June 14, 2021
Share |

Record prices for used cars and trucks were the biggest contributor to inflation last month, according to the government’s Consumer Price Index report.  Prices for used vehicles surged 7.3% just last month, following an even bigger 10% gain in April.  Why are the prices of used vehicles skyrocketing?  In short, there are more people buying cars than there are cars in the market.  New car trade-ins are usually the biggest source of used cars, but supply chain disruptions, especially a widespread of specialty semiconductors used by auto manufacturers, have limited availability of new vehicles—causing prices of scarce used vehicles to catapult higher.  The Manheim Vehicle Value Index, a widely-followed industry yardstick shown in the chart, was described by industry observers as “shocking”.  (Chart from Manheim)

Jeffrey Cerny

Share |