This is a perfect time to Sell your car in Los Angeles and surrounding counties and make a better-than-expected profit!
This is mainly because demand for cars has been increasing steadily, but there isn’t enough supply to balance it.
Below, we take a closer look at the current state of the used car market in America:
What’s Going on with The Used Car Market?
In April 2021, prices of used automobiles (cars and trucks) increased by a whopping 10% in just one month. This is the biggest single-month increase ever observed in the category.
For the record, government officials first started keeping track of the CPI (Consumer Price Index) all the way back in 1953.
Compare this figure with the 12-month all items index—which went up by a mere 5%—and you get a better idea of how much used-car prices have increased.
Reasons for the High Used Car Prices
There are a number of factors that have contributed to this phenomenon of high prices:
1. Production Issues
The global economy may be coming back to life after the COVID-19 pandemic, but there’s still a massive worldwide shortfall of semiconductors.
Until the shortage is dealt with, carmakers cannot operate their plants at full capacity. This means that fewer cars are being produced, and new cars that are available for sale are becoming more expensive. This makes preowned cars more appealing.
2. Rental Companies
Every year, car dealers all over the country buy pre-owned cars and trucks from the big names in the car rental industry—such as Hertz, Avis, and Enterprise. This cycle helps car dealers replenish their stock of used cars and allows rental companies to upgrade their fleets.
This time, though, things are different. Due to the coronavirus pandemic, many car rental companies have already sold a lot of cars from their fleets to stay in business.
Now they’re facing a shortage of their own, which has caused an increase in rental rates. Some companies are also buying used vehicles in these desperate times, which further decreases the available options for used car dealers.
3. Stimulus Checks
On a consumer level, there’s also the impact of the government’s stimulus checks.
Even though these checks have been a lifeline for many families, not everyone in the country needed the stimulus money to put food on their table or deal with urgent expenses.
Many have spent their stimulus amount on home renovation and remodeling. Plenty of people are ready to spend their stimulus money on buying a car, further driving up the demand.
What to Do?
Unless you absolutely need to buy a used car right now, it’s better to wait out this period of high prices.
It won’t subside right away, or even in the immediate future, but having some patience will allow you to buy a car at a good price.
CarZilo gives you a convenient platform to sell your car in San Diego, Los Angeles, Ventura and Orange County. Use our website to get a cash for cars online quote, and get in touch with us for further information.