New Car Market Beaten By The Used Car Market
We are constantly hearing news reports of how the recession is hitting the motoring industry badly. Every week there is a new story of how the motoring industry is suffering because people simply aren’t choosing to buy a new BMW. However, there are sectors of the motoring industry that are doing well, but we never hear about them.
The second hand car market is one of the few parts of the motoring industry that has grown because of the recession. The prices of second hand cars have been doing the opposite to many things in the recession, they have been rising. This may not sound very positive for the customer because you will have to pay more for used cars for sale, however, if you choose to trade in your old car, you will get alot more money for it than previously.
The main reason why the second hand car market is becoming so busy is that many people are trying to save their cash, while still having a car. In an attempt to do this, they opt for buying a second hand car rather than a brand new one. One recent thing that definately hasn’t helped the position of the new car market is that due to the recession, new car prices have actually gone up. You’d think that would be the last thing car manufacturers would want to do, however, because the current exchange rates are so poor, manufacturers are forced to raise prices.
As a result of more people opting for used cars, the demand for these second hand cars has seen a dramatic rise. As the demand for second hand motors rise, plus with the scrappage scheme resulting in more scrapped cars, the job of finding a good used car is becoming harder. Now because used car dealers are running out of cars to sell, they are offering more for trading in a car, making it sound like a better deal for car owners looking to sell.
The only downside to this is that because you are getting more money for your old car, you are having to pay more when you buy your new used car. So because the price rises are on both sides, selling and buying, you are not actually getting any extra cash for your car because you lose it when you buy a new one, but the majority of the public would still prefer to buy a second hand motor rather than a buy a Toyota straight off the production line.
The only people that look to lose out from the price rises are the customers that choose to not trade in an old car.