Car prices already sit at record highs, but hurricane season may make them more expensive

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Used cars and news cars are already really expensive.

Alan Shine Photo / Getty Images

The new car market remains very rare.Prices remain high due to surge in demand COVID-19 (New Coronavirus Infection) The 2020 blockade closed many dealers and idle factories.Thanks to take into account the lack of new car inventory Supply chain bottleneck If there are too few semiconductor chips, average transactions will occur Price over $ 40,000 For the first time in history. Now, thanks to the hurricane season, cars can be even more expensive.

CNN business Hurricane Ida reported on Wednesday that it had destroyed “hundreds of thousands” of cars. Many are brand new with no owner. This is an important inventory for automakers in the tight supply of new cars and is now losing to Mother Nature. Add a flood from Hurricane Nicholas that hits Texas, and it’s a recipe for even fewer new cars that are in demand too much.

read more: How to avoid flood-damaged cars

Not only do automakers generally do not have enough cars for today’s market conditions, but demand is increasing almost periodically following the hurricane season. When the inhabitants come back to find the car flooded and destroyed, they need to replace the car and need to do it quickly. Not only can new car prices be pushed to higher prices, but they can also hit the used car market in the same way that prices have leveled off and have begun to fall at wholesale auctions. According to CPI data, used car prices are showing signs of stability, but fell 1.5% in August, up 32% year-on-year.

The report quoted data showing that Hurricane Harvey in 2017 pushed up used car prices by 3% in the months following the destruction of about 500,000 cars. This was an increase of 3% due to the abundant supply of new and used cars. Please remember. For the first time in history in June of this year Average used car cost is over $ 25,000 Inventory remains incredibly tight overall. More demand and tighter supply inflows can push prices higher than Harvey-induced 3%.

Car prices already sit at record highs, but hurricane season may make them more expensive Source link Car prices already sit at record highs, but hurricane season may make them more expensive

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