Zachary Berry
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The Supply of Recession-Era Used Cars Is Dwindling

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As drivers hang onto their cars for longer periods of time, car dealerships are struggling to keep up with the current demand for used vehicles

GM recalls 2.7 million

Recession-era vehicles are in high demand with low supply

The automotive industry took a pretty big hit during the global recession that began in 2008. As a result, automotive production was greatly decreased, from 53.2 million units in 2007 to 47.77 million units in 2009.

Now, that reduction in production is having a profound effect on the used car market. Indeed, many used car dealers are running out of popular used cars to sell.

Consider an Alternative Buying Option: Why buy used? 

The vast majority of independent used car dealerships rely on vehicles that are around six years old on average. In 2012, a total of 63.07 million vehicles were produced.

However, drivers are holding onto their vehicles for longer. Modern automobiles last longer than their counterparts from the 1980s, 1990s, and the early 2000s. Furthermore, drivers who are priced out of buying a new car are holding off on an automotive purchase.

used car price sticker

Used vehicles are becoming more expensive. But then again, so are new vehicles.

The result is a deficit in the number of used vehicles built between 2008 and 2012. Dealership inventory for these models is down by approximately 700,000 units.

All the while, the demand for used cars has grown. As mentioned previously, many drivers cannot afford modern new models and are thus turning to buying used models instead.

Modern Automotive Tech: StabiliTrak

Even though used car payments recently hit a record high of $378 a month, the monthly payment for a new car averages about $525. The price gap between new and used vehicles is set to grow even more in the immediate future.

Fortunately for used car dealers, vehicle production ramped up in the years following the recession, with global production settling right around 73.46 million units in 2017. Still, don’t be too surprised if you see offers to trade in your old vehicle for a new one from dealerships in your area.

News Source: Jalopnik