A new report finds that the auto industry is nearly unrecognizable from five years ago - with significant shifts taking place in the first half of 2024. Cars Commerce, a Cars.com company, shares its findings in its new Industry Insights Report. Among the findings of its data analysts:
"The car market continues to recover and evolve, with June seeing ongoing price stabilization. When you take a step back for a broader perspective, however, the market has seen sweeping changes since the first half of 2024, particularly with the growing influence of electric vehicles as consumer demand and inventory continue to increase," said Rebecca Lindland, senior director of industry data and insights at Cars Commerce. "And compared to five years ago when the market was last stable, today's market is almost unrecognizable. Consumers are paying more than 30% higher prices for new and used cars with more than a million fewer vehicles available on each side of the market — but they're also making significantly more on trade-ins."
New- and Used-Car Markets: Prices Drop and Inventory Climbs Amid Supply Chain Recovery
Researchers say the broader new-car market has also evolved. Consumers are now spending over $11,000 more on a new vehicle, with prices rising 30% from $37,790 to $49,106 over the last five years. Inventory is down 24% in the same time period, resulting in 1.7 million fewer vehicles available for shoppers. Market recovery continues, allowing manufacturers to increase production and resulting in wider availability of new cars. In the first half of 2024, new inventory is up 13% compared to the first half of 2023, and new-car prices have decreased slightly (down 1%), maintaining an average of around $49,000 for the past nine months.
The used market has followed a similar path. Over the last five years, the average price of used vehicles has surged by 34%, from $21,480 to $28,815, and the ongoing inventory shortage has created a competitive market with 1.5 million fewer used vehicles available. Cars Commerce researchers say the first half of 2024 has offered some relief to buyers, as prices have decreased by 5% compared to the first half of 2023, saving consumers over $1,600. This decrease reflects a normalization from the peak prices seen in 2023, which were driven by intense demand and limited supply. Inventory for used vehicles is down 4% in the first half of the year compared to first half of 2023, with nearly 300,000 fewer vehicles available.
Trade-In Values Offer Leverage for Car Buyers
Trade-in values have increased by 48% since 2019, reflecting the higher value of vehicles in a market with constrained supply and high demand. Despite an 8% decrease in the first half of 2024 year over year, trade-in values remain elevated, providing added leverage for consumers negotiating the purchase of a new or used car.
Key June Monthly Year-Over-Year Highlights
To download the full report, visit www.CarsCommerce.inc.
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