Industry Insights

Scope of the Used-Vehicle Market Since 2020

Why is the Used-Vehicle Market in its Current State?

Covid-19, Drastic Production Dips & the Stubbornness of both Buyers and Sellers

One of the latest Cox Automotive Inc. articles offers a detailed but simple explanation for why the used-vehicle market is in its current state. Referencing the extended factory shutdown in 2020, coupled with 8 million fewer new vehicles produced (and 8 million less future used cars), it’s been tough for the market to rebound. Fewer lease turn-ins and rental units has led to scarce availability. Car owners are choosing to repair and extend the life of their purchased vehicles rather than upgrade, causing another barrier to improve the secondary market. It seems the only way to fix this issue is to incentivize automakers to once again switch up their inventory focus and boost production in the most affordable segments (compact sedan, midsize sedan and compact SUV), which will hopefully spike trade-ins and first-time auto purchases.

Sources

1. Cox Automotive Inc. Why are Prices so High? The Used-Car Factory was Shut Down; coxautoinc.com/market-insights/why-are-prices-so-high-the-used-car-factory-was-shut-down/

Matthew Prendergast

Matt makes up the other half of Auction Central’s marketing team. He focuses primarily on content creation for social media channels and email campaigns, as well as developing partnership opportunities and maintaining relationships with dealers. Prior to joining Auction Central, Matt gained valuable experience working in marketing roles within the sports media, nonprofit and restaurant industries. He is a graduate of Siena College (2020).