Demand for Used Cars Grows With Surge of Certified Pre-Owned, Tumbling Prices
October saw consumer demand for both used and new vehicles spike—but lower prices have led to used vehicles getting bought up faster, according to Detroit Free Press.
CarGurus’ U.S. 2024 October Intelligence Report showed that inventory for new cars increased, while inventory for used vehicles is stabilizing. This increase in supply along with a bump in demand has led to tumbling prices.
Though demand has been on the rise for both used and new vehicles, the gap between the average price for either has been growing. September saw the average price for a used car at $28,400, while a new vehicle was $49,700 on average. The latter is down from $49,700 a year ago; but the average used vehicle price in September was 5% lower than it was in September 2023.
“The spread between new and used average listing prices, in September, was indeed near the highest point on record—more than $22,000,” told CarGurus’ Director of Economic and Market Intelligence, Kevin Roberts.
This price disparity is leading to used vehicles being sold more quickly than new cars.
The used car market has seen a surge of 2022 and 2024 model year vehicles, though it isn’t clear where they’re coming from—most likely fleet vehicles or consumers changing their mind about their vehicle, Roberts added. And though this surge comprises a small segment of the used market, it’s making a difference.
“The 2024 models coming into the used market are a small proportion of used inventory, representing over 100,000 listings, but it is helping with the late model year shortage,” said Roberts.
Last month, listings for certified pre-owned used vehicles rose by 8%, which has also contributed to greater consumer interest. A certified pre-owned vehicle can provide some of the benefits of a new car while being more affordable.
And due to slow sales for new vehicles in 2021, 2022, and 2023, automakers have been granting more leeway to what vehicles are considered certified pre-owned, with the average age of a certified pre-owned car having grown by almost 1.5 years to 4.5 years old between January 2020 and October 2024.
