Since the American economy slowed to a halt in March, businesses across nearly every industry have experienced a financial hit. Some industries, however, have faced a surge of business as consumers adjust their shopping habits in the face of economic uncertainty. Read on to learn more about why more consumers are choosing used cars instead of buying them new this year.
Increased Personal Safety
Public transportation use has increased by almost 30% since 1995, with millions of Americans choosing the bus or subway over a personal vehicle. While public transportation offers many benefits—including a lower carbon footprint, decreased cost over private vehicles, and improved safety—the overwhelming fear of the COVID-19 virus has inspired many riders to reconsider their options. Ridesharing services such as Lyft and Uber saw usage decrease by around 70% during the early months of the pandemic, especially while many people worked remotely from home.
Increased Financial Security
Over 7.5 million Americans lost their jobs during the pandemic, with many employees still questioning when—and if—they’ll be able to return to work. Suddenly, the bells and whistles of a new vehicle pale in comparison to the lower cost of a used vehicle. That doesn’t mean that used vehicles are cheap, though—the average value of used cars on some used car sites increased by almost 20% in July alone. This is in stark contrast to the economic understanding that used cars depreciate in value over time.
Decreased Availability of New Cars
Office employees weren’t the only ones encouraged to stay home during the pandemic—many automotive factories sent their workers home, closing their plants and halting production in an effort to slow the spread of COVID-19. Production was at a stand-still for nearly two months, significantly affecting the supply of new vehicles.
Many dealerships were forced to adjust their selling practices, focusing on their inventory of used cars. Some dealers even resorted to running advertisements encouraging customers to trade in any used cars they no longer needed. While manufacturers will eventually catch up to their production goals, the shift towards buying used will likely remain until the economy begins to improve.
Stroebel Automotive has been the premier automotive repair shop in Saginaw since 1982. We service all makes and models—both new and used! Even if you haven’t driven your vehicle as much this year, regular service helps to prevent costly breakdowns. Visit our website or call (989) 781-4307 to book an appointment today!