Here's Why Your Car Could Be Worth 25% More For A Year

Here’s Why Your Car Could Be Worth 25% More For A Year

While inflation is hitting record levels in the country, the price of used cars just soared nearly 25% in the span of a year, an analysis by Statistics Canada confirms.

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“It’s historic. We have to go back to the 1940s, to the post-war period, to see rare and expensive second-hand cars”, observes the president of the Association for the Protection of Motorists (APA), George Iny.

“Those who have $10,000 to buy a used car will end up with lower quality vehicles. Unlike new ones, there is no retail price. Then the selling price will be more elastic”, he continues.

Last Wednesday, Statistics Canada revealed that the price of used vehicles increased by 24.5% in the space of one year, from March 2021 to March 2022.

In comparison, for the same period, new vehicles increased by 7%.

Impacts of the pandemic

Disruptions in the semiconductor chip supply chain and pandemic-related factory closures continue to affect new vehicle manufacturing, the agency said.

“This change in market dynamics has led to higher price increases for used vehicles than for new vehicles,” Statistics Canada says.

According to Germain Goyer, automotive content producer for the car Guide, Quebec cars are also sometimes shipped to our neighbors to the south.

  • Listen to the Stréliski-Cyr meeting at the microphone of Geneviève Pettersen on QUB radio:

american competition

“New vehicles are rare, so people keep their used cars. Traders also find it more profitable to sell them sometimes in the United States,” she says.

“Even vehicles that are over 15 years old sell for a lot of money, like the Toyota Yaris or the Honda Civic,” he continues.

“I sold a base 2009 Hyundai Accent, glass in hand, with 125,000 miles on the odometer, for over $4,000 at auction. A year ago, it was worth $2,000 or $2,500,” shares Maxime Ménard, owner of Financez-vous.ca, in Beloeil.

“2008 Ford Escapes that cost $2,500 a year ago are selling for more than $4,500,” he adds.

For Robert Poëti, executive director of the Quebec Automobile Dealers Corporation (CCAQ), people who have moved away from the city center during the pandemic need a car again to return to the office.

“There are people who need a second car more,” he says.

“A person who had a new vehicle for a year and a half is offered the same price or a little more. Positive equity, we have not seen it often, ”observes who does not remember such a market in his life.

hard to justify

At used car dealerships, it’s getting harder to explain to customers why prices have skyrocketed.

“It is really very expensive. We break vehicles between merchants. – Maxime Ménard, owner of Financez-vous.ca

“It’s getting hard to justify the price. Mechanics are more expensive due to shortages of labor, spare parts, transportation… so we make more profit on financing,” laments Maxime Ménard of Financez-vous.ca.

Yesterday, The newspaper He talked to several customers who were surprised to be offered so much money for their used car.

One of them, who had paid $4,600 for a car with 70,000 miles on the clock, had his “kitten” bought for $1,200 four years later, even though he had a venerable…110,000 miles.

–With the collaboration of Charles Mathieu

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