Shoppers feeling the pinch from rising new car prices could find more ways to stretch…
Shoppers feeling the pinch from rising new car prices could find more ways to stretch their dollars by turning to the used car market, according to a recent Used Vehicle Report released by the car shopping experts at Edmunds.
In the second quarter of this year, car shoppers could have saved $14,443 on average if they purchased a 3-year-old used vehicle instead of its new equivalent.
This is the largest average price gap between 3-year-old used and new vehicles that Edmunds has on record for the second quarter.
Edmunds analysts attribute this in part to new car shoppers opting for higher trim levels and more options on larger vehicles: Ten years ago, the average sticker price of a new vehicle was $6,500 above the base vehicle price; in the second quarter of 2019, the average sticker price was $10,042 above the base vehicle price.
“Content is king and new-car shoppers are packing on the options like never before, which is now starting to trickle down into the used market,” said Ivan Drury, Edmunds’ senior manager of industry analysis. “From alternative powertrains to advanced technology, entertainment and safety features, we’re seeing a dramatic increase in added options, and this is across virtually all vehicle categories — not just heavy-duty trucks or luxury cars. The consumer mindset has definitely shifted to embrace ‘more car’ across the board.”
Although these extra options add up quickly on new cars, Edmunds experts say that car shoppers aren’t paying the same premium for those features in the used market.
Edmunds’ report reveals that in many instances, a trim level might cost $10,000 over the base model when new but command less than half of that premium on the used market.
For example, in 2014 a new Honda Accord at the highest trim level cost $10,278 more than the base model. Today, a used 2014 Honda Accord at the highest trim level only costs $4,402 more than the base model.
“Used-car shoppers are getting the most bang for their buck because they’re acquiring amenities and advanced technology features at a fraction of the original purchase price,” said Drury. “If you’re in the market for a vehicle and finding that the cost of a new car is just out of reach, take a look at the used inventory at your local dealership. Chances are that you’ll find all of the bells and whistles on a similar vehicle at a price that’s more in line with what you can afford.”
Find out more at www.edmunds.com.