Used Car Prices Rise Dramatically
“Frugality is in fashion, and a used car purchase looks and feels more thrifty,” notes Edmunds.com Senior Analyst Jessica Caldwell. “However, a number of people are researching used cars on our site but then ultimately buying a new car, swayed by the limited used inventory available and the minimal difference between the prices of lightly used cars and their heavily incentivized new counterparts.”
Some of the most dramatic examples of used car price increases can be found in the General Motors stable. The prices of used cars and trucks from General Motors have risen 7.8% in the past year, mostly due to the pricing power of GM’s full-size trucks and SUVs. For example, a three-year-old Chevy Silverado 1500 costs 23.7% more it did than this time last year, and the average three-year-old Chevy Tahoe price is up 31.2%. In the same period, the prices of used cars from Honda increased only 2.3% and Toyota’s declined 0.9%.
Even some of GM’s terminated models have experienced dramatic price increases, thanks to the highly competitive used car marketplace. A three-year-old Saturn Vue costs about 15.9% more than it did this time last year, while its segment is up 11.3%. Used Pontiacs are also holding their value: a three-year-old G6 costs about five% more than it did this time last year, outpacing its segment by almost three%age points. The prices of used Grand Prix and Solstice models are up slightly over their segment average increases as well. And, perhaps a true sign of low gas prices, used Hummer H2 and H2 SUT price increases of 18.4% and 17.2%, respectively, are outpacing their segments.
“Given the dynamics of today’s marketplace, it is worthwhile for a bargain-hunter to consider looking at new cars – which in some cases are less expensive to buy than used cars,” says Edmunds.com Senior Consumer Advice Editor Philip Reed.