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Used Car Asking Prices Trend Downward As Supply Increases

Used car prices have been on an upward trajectory for years now, routinely reaching record highs with each passing month and even outperforming many other assets in the process. However, the market has shown some signs that it’s beginning to crack in recent months as inventory has slowly increased while prices have cooled slightly. There are also some good deals to be found on certain models, such as the Ford Taurus, C-Max, and Fusion, while geographical location makes a big difference in pricing as well. In fact, the Ford Escape crossover, Ford Explorer crossover, and Ford F-150 pickup are among the used vehicles with the biggest pricing disparities in the U.S. Now, the latest data from Cox Automotive is a bit encouraging as well, as it shows a continued downward trend in used car prices in the month of May.

Last month, used car prices inched slightly downward to $28,312 from $28,372 in April, but prices have continued to fall each week since May 9th. Through April, price growth stood at 28 percent for the year, but is now just 16 percent, with further declines predicted throughout the summer.

Meanwhile, inventory remains fairly steady as there were 2.47 million unsold used vehicles at the conclusion of May, compared to 2.52 million at the end of April. At the start of June, inventory had risen around seven percent over a year ago, while days’ supply – coming in at 42 at the end of the month – was 24 percent higher, year-over-year.

“The end of May showed interesting and divergent patterns for new and used listing prices,” said Charlie Chesbrough, Cox Automotive senior economist. “We have been expecting vehicle inflation to ease as the anniversary of the start of the chip shortage passes, and that, indeed, is occurring in the used market.”

We’ll have more on the state of the used vehicle market soon, so be sure and subscribe to Ford Authority for 24/7 Ford news coverage.

Brett's lost track of all the Fords he's owned over the years and how much he's spent modifying them, but his current money pits include an S550 Mustang and 13th gen F-150.

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Comments

  1. Mannix

    Auto loan defaults are already rising. Repo man will be busy soon.

    Reply
  2. Mike

    The used car lots around me, that had cars stacked on top of each other before the pandemic, then emptied out during the pandemic, are filling back up again, and some, to the level of pre pandemic inventories, and they are no longer begging to buy used vehicles. Deals should be available in the near future.

    Reply
  3. Scott Graves

    The deals will be good, the financing may be a different problem.

    Reply

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