Posted Tuesday, September 20, 2022
Selling a car can often be a confusing and even arduous process. You might not know what your car is worth or whether the used car lot or private buyer you’re selling it to is trustworthy. Likewise, you may want to trade your car in but be unsure where to start and how much other vehicles are really worth.
This year — with the disruptions produced by the pandemic, and consequent price spikes of many goods, including used cars — that confusion and uncertainty may feel even more palpable.
Fortunately, there is really no reason for that to be the case. In fact, by many metrics, now is a great time to sell your car! With used car prices uniquely high and new cars in short supply, now can be an excellent time to generate a significant return. This may be especially true if you currently own a car that is not getting much use, and you could use a little extra cash for it.
Read on to learn about why selling a car in the Tucson, Arizona, area right now can be a great financial and personal choice for you.
Due to both the pandemic and other factors, the car market is currently in an unusual state. A number of supply chain issues have cropped up over the course of the last year and a half, and they have yet to fully return to normal. A particular issue affecting both new and used car prices has been a global microchip shortage, an electronic component that is essential to a wide variety of items, including cars.
This shortage is due to many factors. Supply chain hold-ups associated with the effects of the Covid-19 pandemic have been one of them. Unusual patterns of supply and demand over the last year and a half have been another: demand for many items, including cars, weakened in the early part of the pandemic, and many car manufacturers canceled orders. However, the proliferation of individuals working at home ultimately strengthened demand for microchips for other electronics — and as car demand rebounded, there were simply too few microchips to accommodate requirements for automobiles. Environmental factors, including a severe drought in Taiwan (the world’s leading producer of microchips), have also played a part. At this point, it remains unclear exactly when the microchip supply will fully increase to meet demand.
But demand for cars has also rebounded, and now is very strong. Some of this may also be due to the pandemic and an associated desire by individuals to have their own means of transportation and avoid public transportation or crowded settings. In short, all of these factors have combined to produce high demand for cars — particularly used cars — with accompanying relatively low supply.
As of October 2021, the average price of a new car is over $45,000 — an unprecedented average sales price for a new car. Notably, this trend has continued for at least the last six months, even though car sales have actually fallen. According to the same article, new car sales have actually fallen in the same period, and September 2021 was particularly bad for new cars. All of this suggests that new car sales prices have yet to top out and may continue to rise for an indefinite period.
Naturally, the increasing price of new cars has had a significant effect on the price of used automobiles. Used car prices also continue to be extremely high — and in fact, used car wholesale prices are 27% higher than they were one year ago, in September 2020.
All this suggests that it may be an especially good time to sell your used car!
While a lot is uncertain in the current used automobile market, one thing is fairly clear: if you sell your car now, you potentially stand to earn significant value for it.
Obviously, this is sometimes easier said than done. If you only own one car, you may not be in a realistic position to sell your car, particularly if buying a new vehicle is economically prohibitive for you. Likewise, if your car is in poor repair, it may not fetch as high a value as you might hope, even under current market conditions and associated shortages.
Still, it is a unique market right now. In general, it is often true that you will get the most value when you sell your car privately to another individual. However, in these unprecedented times, selling your car to a used car lot — particularly if you have an older, fairly desirable model in generally good condition — can get you a healthy price for your vehicle. Used car lots are uniquely aware of current market shortages and may be willing to pay top dollar for a used car in relatively good condition.
For various reasons, now can also be a good time to think about trading in your used car. Finding a dealer with a strong need for your type of used car may help you get the most value for it. For instance, if you are attempting to sell a truck, and a particular dealership is short on trucks, you may be most successful and get the highest value for your vehicle if you trade it in there. Dealers are uniquely vulnerable and receptive to current market conditions. They can help you to understand the current high value of your automobile, as well as your ideal choice for a new vehicle.
In general, it is worth doing consistent research and potentially shopping your vehicle around — particularly in the event of a trade-in — to ensure you are getting the best value possible. But once you have found the right dealer, now can be a great time to complete a highly valuable trade-in.
If you are looking to sell a used car in Tucson, Arizona, or the surrounding area, contact Cactus Auto! We have enormous experience with a wide variety of used automobiles, and we can get you the best possible deal on your used car. At the same time, we can make the process smooth, streamlined, and hassle-free for you in this volatile market.
If you are interested in selling a used car, consider starting with our free appraisal, which can offer an estimate to you for no charge. We have a great selection of inventory as well for individuals interested in a trade-in.
Now is the time to sell! Visit us at Cactus Auto to take the next step on your vehicle sale process.