2022 Used Car Buying Trends
Will car prices drop in 2022? Over the last couple of years, the automobile industry witnessed a surge in new car prices. The pandemic disrupted supply chains and caused shortages in critical components which led to a lack of new vehicles hitting car lots, only making matters worse for consumers.
The recent uptick in new car prices has made used car sales skyrocket as well. The total dearth of new car inventory has caused a buying frenzy at used car lots across the country and has sent potential buyers looking for deals in the unlikeliest of places. If you’re looking to get a new or used car in the next month, you may want to wait until the kinks in the supply chain have worked themselves out. Let’s take a deeper dive into 2022 used car buying trends and when is a good time to pull the trigger on a new or used vehicle.
2022 Used Car Buying Trends
According to the U.S Bureau of Labor Statistics (BLS) statistics from March 2020, the consumer price index (CPI) for used cars has gone up 39%. In comparison with this increase in prices and inflation rates across all other goods/services measured by BLS, new car prices increased 8%, while the overall US inflation rate was up over 6%.
Will Car Prices Drop in 2022?
Another forecast provided by Automotive News and LMC Automotive analysts predicted that 2022 will prove to be another challenging year for auto dealers and consumers, but do suggest that some signs of recovery could be on their way. But the age-old issue of supply and demand persists. With shrinking supply and increased demand, auto prices continue to rise. Some of the reasons for this can be associated with auto loan interest rates hitting rock bottom during the pandemic, as well as people moving out of larger cities where public transportation is widely utilized. This has caused an increase on both sides.
What Consumers Can Expect From the 2022 Used Car Market
So what is the solution for both consumers and car dealers? Most automotive experts say that it is only a matter of time before supply and demand issues will balance out. But as far as a definitive timeline, that remains up for debate. The recent action on behalf of the Biden administration to keep the Port of Los Angeles open around the clock was a step in the right direction but hasn’t solved the bottleneck. While it offered some relief, auto parts production has continued to be a problem. Semiconductor and chip shortages will last until at least 2023 and with most parts being imported from Asia, they’ll need to catch up with production in this post-pandemic reality to meet demand.
As buyers continue to outpace sellers in terms of demand, it’s no surprise that prices won’t be going down anytime soon. This is shared by industry professionals like CarMax’s Lyski who predicted that inflated prices would stretch, “well into 2022.”
Hearsch of AlixPartners says that if you see used car inventory sitting on a dealer lot for more than 50-60 days, then it’s likely the pricing will normalize soon. Bottom line, if you are absolutely dead-set on buying a used car in 2022, shop around. There are deals out there to be had. And with a little determination and some savvy negotiating skills, you should be able to find the used car of your dreams for a price that won’t break the bank.
Are You Shopping for a Used Car in 2022?
If you’re looking for an affordable, high-quality pre-owned vehicle, Hawthorne Auto Square can help. We have numerous sedans, trucks, and SUVs suited for winter travel. We can get you approved for financing in minutes and offer numerous payment options. To learn more and set up an appointment with us, call 866-707-7664 today.
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