Semiconductor chip shortage causes used car prices to skyrocket
JACKSON, Miss. (WLBT) – If you are in the market for a new car, you may have been waiting for a while. Those who don’t want to wait turn to used vehicles but fall for the stickers.
New cars are on the ground and many are getting behind the wheel of a used car but are paying a lot more than just a year ago.
“It’s a little hard to find a good used vehicle now, and the prices have gone up dramatically,” said Seam Curry.
The Columbus resident left the Watkins auto sales park with a 2010 Honda CVR. He made the two and a half hour trip for what he said was the best price he could find.
“I had a small car like this before. A few days ago it broke down on me, ”Curry said. “So I went to the website, started looking and found this car here and went down today to pick it up from Mr. Redd, and he told me he had it. had ready and was waiting for me ”.
The shortage of semiconductor chips in new cars is driving up sales of used chips. Cars.com reports that the median price of a used car is almost $ 24,000, up 34% since August 2020.
That’s over $ 8,100.
“But in the last three to four weeks it’s grown a lot,” Kerri Watkins said.
She owns Watkins Auto Sales in Jackson and says the chip shortage is pushing up used car prices over last year. She said that in this tight market, down payments are now a must.
“We have seen a huge increase in sales, but more importantly, in the price of used cars from last year to this year. That’s about a 30 percent increase, ”Watkins said. “A year ago, two years ago, you could go to the dealership and negotiate $ 500 or $ 1,000 off the sticker. It doesn’t happen anymore. You know, what you see is what you pay for.
Watkins recommends that you purchase a service contract if the car is not under factory warranty. A gap insurance is also suggested in the event of a vehicle accident.
It will cover the difference between what the insurance pays and what is owed on the car. Industry experts expect used vehicle prices to remain high in the coming months.
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