Saturday, November 20, 2010
As many of our regular readers and customers know, we here at Pumpkin Fine Cars do our best to keep you informed on current industry trends and news. We do this because we like to add more value to your experience buying at Pumpkin and want to keep you as informed as possible so that you can make the best possible decision when shopping for and purchasing a car.
Right now, the major news in the pre-owned car industry is that prices for pre-owned cars are at an all time high. There are a few reasons for this and they can be explained for the most part with simple laws of economics. We are all aware of how rough the current economy is and has been in the past few years. No explanation needed there. One result of these very tough economic times is that more and more cars buyers are going the pre-owned route, rather than buying new. The first reason for this is that many simply cannot afford a brand new car and find more value or "bang for their buck" buying pre-owned. The second, which may or may not be surprising, is that it is trendy to be frugal. Car buyers do not want the stigma of spending money on a brand new car. Both of these reason are leading to an increase of demand on the pre-owned market. Now, dealing with the issue of supply, meaning the pre-owned inventory that is available to dealers like Pumpkin Cars, it is shrinking. Many auto manufacturers are selling less inventory as fleet and lease vehicles, which typically are sold wholesale when their lease term has expired, making their way into pre-owned inventories. The major reason for the tightening of the supple of pre-owned cars was the popular "cash for clunkers" program. This program took approximately 700,000 cars off the road.