Should I buy a used or new car? Now is not the time to buy
In the current car market, is it better to purchase a new or used vehicle?
The best advice I can give right now is to stay away from new cars. In fact, the shortage of vehicles has continued to worsen clearly due to the microchip shortage and the situation is not supposed to get better for another 2 years. To deal with this shortage, some dealerships are adding anywhere from $2-10k additional mark up on new vehicles.
Last month, I wrote about the lack of new vehicles so this month, let’s look into the used car market. Is it really that bad? Yes, it really is.
Used cars can be more expensive than new cars
Here we go folks. Here is what has happened as a result of little to no new vehicles available. Used vehicles of all kinds became more appealing. This caused prices to become ridiculous at best. In fact, used vehicle pricing has soared to around $2k above KBB retail values if not more. Pre-owned vehicles that are 3 years old or less can even be priced above its original MSRP! Dealers everywhere are scrambling to find anything to put out on their lots and keep the cash flow coming.
Vehicle auctions have become war zones with bidders driving prices well above retail as every dealer struggles for inventory. Dealers are even calling their previous clients to buy back vehicles at unbelievable prices. Auction prices are up as much as 52% over 2019 prices.
No deals to be had
As opposed to previous car buying experiences, if you go to a dealership today, you’ll find yourself facing off against not just the salesperson on the other side of the desk, but the horde of other potential customers angling to snipe your car of choice right out from under your nose! Forget looking for the best price or the perfect color, you’ve now got to consider how quickly you can get to the dealer to sell you a car that close to what you wanted. Sadly, now buyers are considering and buying brands they would never have considered before. In any market where supply has shrunk and demand has surged, it’s unrealistic to expect prices to reflect the kind of incentives and low interest rates that were common pre-pandemic. Dealers simply have no incentive to slash prices or offer discounts when turning over what little inventory they have.
So again, if you do not have to purchase a new or used vehicle, don’t. Now is not the time.
I supe hope this information has been useful. In my 43 years of being in the car business, this is by far the most difficult time I have ever seen.
Thank you all for reading.
In you are in need of a new or pre-owned vehicle or you have a car and do not want to hassle with selling it yourself, please allow us the opportunity to purchase or sell it in consignment. We provide pick up as well as delivery service. If you have comments or questions, please feel free to reach out to me: firstname.lastname@example.org or visit fergusonautobrokers.com