With used-car prices at historic highs, customers hoping for those prices to decline may have to wait years for a reprieve.
Prices for used cars are likely to stay high for the next two to three years, according to a report released Thursday by Kelley Blue Book, which tracks new- and used-car prices, according to The New York Times.
The service attributes the sustained strength of used-car prices to a gradual decline in new-car sales dating to 2008, as well as a drop in the number of leased cars becoming available at the end of their contract terms.
The report said that the price of the average one- to three-year-old used vehicle was rising 15.8 percent per year. In 2008, the average cost of a one- to three-year-old vehicle was $15,042, but now the average is $23,353, according to the report.
Many in the industry, Kelley Blue Book included, had claimed that used-car prices peaked late this spring. Forecasters had said that healthier new-car inventories, aided by the recovery of production capacity in Japan after the March earthquake and tsunami, as well as lower fuel prices, would lead to a sales uptick in showrooms and, subsequently, more trade-ins and private sales of used cars.
But showroom sales remain sluggish, and analysts now are concerned that volatility in the financial markets and sustained high unemployment may encourage potential buyers to hang on to their vehicles rather than buy new ones.
Daniel F. Akerson, the chairman and chief executive of General Motors, expressed skepticism earlier this week that total new-car sales, across brands, in the United States this year would reach the company’s forecast of 13 million vehicles. July sales suggested an annual selling rate of about 12.2 million units.
For those who can afford to part with their cars, particularly compact and midsize models, the selling environment is optimal.
Manheim Consulting, which follows used-car sales, says the average price of a small car rose 16.7 percent in July compared with the same period a year ago, while the average price of a midsize car was up nearly 12 percent.
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