If you’re in the market for a new vehicle, you’ve likely noticed that some of the models you were interested in aren’t available in your preferred format and happen to be accompanied by sizable dealer markups. Well the used market, formerly a refuge for those seeking a bargain and a shrewd way of dodging the steepest period of deprecation, isn’t doing much better.

According to Black Book, the typical transaction price for used vehicles has gone up by over $500 in less than a month. Pegged at $27,000 in November, the average secondhand car now trades for over $27,500. As we’ve recently covered just how wild secondhand vehicle prices have become in 2021, we’ll keep this one relatively brief. But it must be said that automotive values are starting to seem totally disconnected from anything that could be considered rational as cars now have MSRPs a third higher than they were at the start of 2021.  (Read More…)

Used-vehicle prices set another record last month thanks to elevated demand and suppressed production of new cars. Depending on who you ask, the typical transaction fee for a secondhand automobile rose nearly 50 percent in November vs the same period in 2020. While the pandemic had meaningfully suppressed demand during that time, that’s still a staggering increase over any 12-month period.

Sharing Cox Automotive’s Manheim Used Vehicle Value Index, Automotive News nailed down the annual difference to a 44-percent increase. This also represents the November pricing index swelling by 3.9 percent against October, which is noteworthy in itself. But what does that look like in dollars?  (Read More…)

Last week, Mexican President Andrés Manuel López Obrador made a pledge to legalize millions of vehicles being illegally imported from the United States. While it sounds like a phenomenal way to help the nation to contend with product shortages that are driving up vehicle prices around the globe, all of the cars had been smuggled previously and many were presumed to have been stolen.

This has created a lot of tension. Despite there being evidence that these vehicles frequently end up becoming workhorses for criminal cartels, illegally imported beaters also provide a cheap alternative to poorer residents right when automotive prices (new and used) have started to disconnect from reality. Times are tough and destitute families aren’t going to care where a car comes from when it’s the only one they can afford. So López Obrador has officially launched a new regularization program designed to bring these automobiles into the fold.  (Read More…)

Years ago, waiting for a haircut, dental appointment, or psychological evaluation meant thumbing through a paperback filled with local listings of automobiles you had convinced yourself you might be in the market for. While primarily an exercise for wasting one’s time, there was always a chance you’d run to a payphone or whip our your Nextel to contact the seller so you could begin the delicate dance of commerce.

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The secondhand market for sporting automobiles is a bubbling cauldron of volatility with one assurance — rarer is always better. Being racy doesn’t hurt resale value, either. That’s why track-focused manual transmission Ferraris go for an exorbitant premium on the secondhand market against their more casual counterparts. It’s also why certain the versions of the 911 can be resold at over double their original MSRP. But Porsche, like many high-end performance manufacturers, is getting sick of customers purchasing their vehicles for the sole purpose of flipping them.

The German automaker says it’s extremely aware of what is going on in the secondhand market and actively wants to take steps to crack down on for-profit flipping. It has also, perhaps inadvertently, made some headway already by bringing the 2018 911 GT3 to market with a manual transmission — potentially devaluing the manual-only 911 R. This has annoyed some capitalists hoping to resell the R at triple its original value. To that Andreas Preuninger, head of Porsche’s GT division,  says “we’re not a hedge fund.”  (Read More…)