**The Stabilization of Used Car Prices by 2024: What Experts Predict**
The forecasted stabilization of used car prices by 2024 brings a sense of relief to potential car buyers after experiencing record highs in recent years. The automotive data firm Cox Automotive anticipates a marginal 0.5% increase in wholesale prices on its Manheim Used Vehicle Value Index by the end of 2024. This projection indicates a significant shift from the fluctuations and declines witnessed in the previous years.
**Factors Influencing Stabilization**
The stabilization of used car prices can be attributed to several factors. Historically, the availability of new vehicles had plunged to unprecedented lows due to disruptions in the supply chain and parts issues during the coronavirus pandemic, resulting in inflated prices for both new and used vehicles. However, as the industry gradually recovers from these challenges, the market is expected to stabilize, offering some respite to consumers.
**Price Trends and Consumer Impact**
The slight increase in wholesale prices is expected to benefit potential car buyers, signaling the end of the extreme volatility witnessed in recent years. Despite this, it is important to note that used vehicle prices remain higher than pre-pandemic levels. Retail prices for consumers, which typically follow changes in wholesale prices, have not decreased as rapidly as wholesale prices in recent years.
Cox Automotive reports that the average listing price of a used vehicle was $26,091, representing a 3.9% decrease from the previous year. Despite this decline, the average listing price is still 7.5% lower than at the end of 2021. In 2019, the average listing prices for used vehicles were less than $20,000, highlighting the significant increase over the years.
Used vehicle sales are expected to witness a modest increase, projected to grow by less than 1% to 36.2 million. This forecast, which includes 19.2 million in used vehicle retail sales, reflects a stable trajectory for the used car market. In comparison, new car and truck sales are expected to experience a meager 1.3% increase in the United States this year, amounting to 15.7 million units, according to Cox Automotive.
**Market Trends and Consumer Outlook**
As the economy and the auto market anticipate modest growth, the stabilization of used car prices augurs well for consumers. With new supply returning to the levels seen in the spring of 2020, consumers can expect a favorable impact, potentially leading to lower prices as the industry continues to recover. Additionally, the forecasted increase in all-electric vehicle sales, accounting for over 10% of retail new car and truck sales in 2024, indicates a significant shift towards sustainable transportation options.
The forecasted stabilization of used car prices by 2024 presents a more predictable outlook for the automotive market, providing potential benefits to consumers. The gradual shift towards lower prices and the anticipated increase in all-electric vehicle sales signal a positive trend in the industry. Despite the lingering impact of the pandemic on pricing and consumer behavior, the projected stability offers a glimpse of optimism for both buyers and sellers in the used car market.