Used-Car Prices Hit All-Time High

Used-car prices soared in September to a new record, according to the Manheim Used Vehicle Value Index, which measures the prices and values of used cars.

As we wrote in September, low inventories led to an increase in used-car prices. Much of this is due to the Cash for Clunkers program, which sapped new-car inventories and forced dealers to scrap and recycle vehicles that might normally be trade-ins. The higher prices were also influenced by fewer vehicles from rental car companies landing in the used market and a summer slowdown at many automaker factories, according to Manheim Consulting.

While higher prices are no good if you’re shopping for a used car, it does mean that the trade-in value of your used car has also increased.

The Manheim Index rose 6.9% in September to 118.5, which is a record high. The index comprises the wholesale or trade-in value of vehicles and has a baseline of 100, which represents used-car prices in January 1995.

The consulting firm also predicted that used-car prices have peaked. With the end of Cash for Clunkers, used-car prices should begin to creep back down.

Used Car Prices Reach Record High in September (Auto Loan Daily)

Comments

Lets ask our Nobel Prize winner, my main man, the smartest, father of our Nation, the Obama....
for the new version of Cash For Clunkers. This is when you have to come out with a lot of cash for the clunker.

so... the concept of supply and demand is suddenly and shocking idea?

what supply? what demand?
when you forcefully take part of the stock off the market the rest will be in greater demand and lower supply.
If they will bring down good number of houses, the real estate price will go up.

yeah, supply and demand...
exactly.
Thanks for clarifying that.

There's also a line in the post above that talks about trade-in values going up as a result as well.
There's two sides to every coin.

The destruction of 700,000 cars through the cash for clunkers program not affected used car prices, it severely hurt car repair shops and charities that rely on the revenue from car donation.

These cars can be put to good use. If the prices are soaring high then people would think about buying a new car instead..