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Used Vehicles & Covid = $$$

Used car times are tough. Covid 19 has impacted many aspects of our lives, and this business is not immune, no pun intended. The used car market has gone crazy, with wholesale supply limited and associated costs skyrocketing. I’ve had great difficulty acquiring quality vehicles that I normally would buy on a weekly basis. New car sales and production are off some 35% in the last 3 calendar quarters, which translates into fewer trade in cars, a main source of used car inventory. There is a world wide shortage of microchips that are the brains in modern vehicles. This is causing a tremendous shortage in new vehicle inventory, fueling the sales downturn. Fewer new car sales equal fewer trade in vehicles. Also, the pandemic has more people opting out of public transportation and driving, causing an increase in vehicle demand. The result is a rise wholesale costs as much as 42% in the last several months. So buying these vehicles has become a tremendous challenge. If you’re in the market, you probably wondering why prices seem so high when you compare the book values to what sellers are asking. Simply put, book value data has not yet caught up with the current selling trends. This may be the new normal for a while. Time will tell. I wish I had more to offer, but I can’t justify selling less quality for more money at this time. The market will eventually adjust, and the new norms will be established. Slim pickings until then. 🙁

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