New Car Prices Are at Record Highs While Used Car Prices Come Down
As 2022 comes to a close, we see that new car prices are soaring while used car prices are trending downward.
Written by Alexandra Maloney
Reviewed by Lisa Steuer McArdle
It’s been an unpredictable year for car prices. With the automotive market still feeling the impacts of the coronavirus pandemic, plus dealing with supply chain issues and more, car prices have been fluctuating uncertainly all year.
But as 2022 comes to a close we see that currently, new car prices are at record highs, while used car prices are coming down.
Jerry
has the information you need on these car sales trends, including what it means for car buyers
. New car prices soar
When it comes to current car price trends, the bad news is that new car prices are at an all-time high. According to
Kelley Blue Book
, the average new car in November 2022 sold for $48,681, which is a record high. The average non-luxury car was sold for $44,584 and the average luxury car was sold for $67,050 during the same time frame.But, the average markup on a vehicle last month was just $410, which means drivers were getting their cars for relatively close to MSRP.
Jalopnik
reports that the MSRP of new cars is being driven up by supply chain issues and specifically, chip shortages. Chips are a necessary part to creating a new vehicle, therefore the chip shortage resulted in fewer new cars being made. Plus, many automakers reportedly used the chips they did have available to focus on higher trim levels and increase profits. We see now at the end of the year, this all resulted in new car prices soaring.
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Used car prices drop
Although new car prices are sky high, the good news is that used car prices have come down.
CNBC
reports that in the latest inflation reading, used cars are one of the few categories with prices lower today than they were a year ago, at an annual 3.3% decline. While the decline is definitely a positive for buyers, used car prices overall are still inflated. Because new cars have been facing supply chain issues and shortages since the pandemic, demand for used cars has increased, causing prices to inflate. As it stands near the end of 2022, used car prices are still about 33% inflated.
The 3.3% drop is definitely a start, but buyers still have a long way to go before they’ll see a
used car
with a sticker price similar to pre-pandemic. How the sales trends impact buyers
All this to say, car prices are still inflated at the end of 2022. While buyers might be able to get a better deal on a used car now than at the beginning of the year, they’re still expensive.
As for new cars, prices continue to trend upwards.If you’re searching for a car, be sure to shop around, compare models, test drive before you buy, and look at all purchasing options available.
4.7
