High Prices Are Now Taking Some Consumers Out Of The Used Car Market

Higher transaction prices are “just taking some people out of the market,” Penske said.

In the U.S., vehicles that once sold at CarShop’s preferred price point of $20,000 became more costly to acquire, meaning their price tags had to move to $30,000 territory, Penske said. It considered lower-value vehicles — those between $8,000 and $12,000 — but decided those are wholesale vehicles, not ones to retail.

Sonic President Jeff Dyke said late last month that the retailer is seeing demand for vehicles up to 8 years old. It started to include such older vehicles in EchoPark’s inventory earlier this year after having difficulty securing 1- to 4-year-old vehicles.

Demand now has dropped for “a $640 monthly payment for pre-owned, and that’s what you’re getting when you’re selling a 1- to 4-year-old car right now,” Dyke said.