Volvo Cars Tech Fund invests in Israeli technology start-ups MDGo and UVeye
New Audi SQ7 TDI fitted with 4L biturbo V8 diesel; 48V

In 2018 in US, rise in prices for used vehicles outpaced that of new vehicles

The used vehicle Consumer Price Index (CPI) in 2018 was 4.4 times higher than in 1970, while the new vehicle CPI was 2.8 times higher—i.e., used-vehicle prices have risen more than new-vehicle prices.

Used-vehicle prices were more volatile than new-vehicle prices over the period from 1970 to 2018 and used-vehicle sales are more variable as well. Both new and used-vehicle CPI grew at a slower average rate than the overall CPI.

The new and used-vehicle CPI are calculated by the Bureau of Labor Statistics using consumer transaction prices from surveys of new-vehicle dealerships and the NADA Official Used Car Guide.

Fotw1091_r

Comments

Christos Dimou

Interesting. Car prices grow more slowly and have remained flat for almost 25 years.

HarveyD

And the used vehicles CPI has dropped from 5.0 to 4.5 (about -10%) in the same last 25 years?

Engineer-Poet

The increasing quality of vehicles must be making used vehicles a better and better deal over time, so worth more.

HarveyD

In the last 25 years, used car price index has gone down (about -10%) while new car price index has gone up (slightly) according to the above graph?

Calgarygary

A 6.6 fold increase in the CPI over 48 years works out to an average rate of inflation of about 4% overall. Not sure about the methodology used here but the 2.8 fold increase in price for new cars could reflect a change in the mix of vehicles, ie. more civics and corrolas and fewer chargers and superbees or whatever was popular back in the seventies, but I'd also expect the quality and durability of modern vehicles has improved substantially as well. I always buy used cars because I consider them far superior in value so I am grateful to those who feel the need to do the heavy lifting in terms of absorbing depreciation and buy new.

SJC

You have supply, demand and price.
The price going up says the demand is up and/or the supply is down.
I would say the demand is up, there seems to be a supply.

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Working...
Your comment could not be posted. Error type:
Your comment has been posted. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.

Working...

Post a comment

Your Information

(Name is required. Email address will not be displayed with the comment.)