Used car buyers have felt the pinch of crazy-high prices.
Whether you’re a car enthusiast or a regular Joe, you’ve probably noticed the insane price of used cars recently. Endless accounts of people trading in cars for more than they paid new. Problems with supply have made new car availability limited. Just look at all the empty dealer lots.
The surge in value is good for sellers, but bad for buyers. Plenty of folks who just need to get their hands on transportation are out of luck. Our very own Nathan Adlen went through this exact situation when he had to total out his Nissan Pathfinder. We made a video about it which you can watch here.
There may be some good news ahead
According to a recent article published by Bloomberg, “used-car prices, which have risen at an annual rate above 50% at times during the pandemic, went into reverse last month, according to a new report from CoPilot, a car-buying app.”
The decline in used car prices has been small so far, about a 1.4% since the holidays. Even still, it is a relief to see things going in the right direction. According to TrueCar, another sales platform, there is a similar trend with new car pricing as well. That is especially good news. Dealer markups have been out of control, as we have shown in detail.
Why this happened in the first place
The worldwide semiconductor shortage has been a major contributor to supply issues. Andre Smirnov, managing editor of TFLtruck, wrote an article a few months back about thousands of Ford Super Duty trucks parked, all waiting for chips.
The importance of semiconductors is only going to increase over time. To help address the shortage, Intel has invested billions of dollars into new manufacturing facilities. These are all signs of better times to come. As ever, though, we just wish things would get back to normal sooner, rather than later.