For motorists considering switching vehicles, this is a relief. The price of used cars is finally leveling off. During the first three months of the year, it evolved by 0.4% compared to the last quarter of 2022 according to estimates by La Centrale. The crazy inflation experienced by this market finally seems to stop.
However, compared to last year, buying a used car still costs a lot more. The average price of a model less than 24 months old is no longer far from 30,000 euros. And the increase is especially spectacular in models between 5 and 8 years old: +19% in twelve months.
+63% for second-hand goods with more than 15 years
When we compare the prices with those before the Covid crisis, the finding is even more staggering. This is particularly true for models over 15 years old, the same ones that are mainly bought by more modest motorists. The average price of these vehicles at the end of their career has gone from 4,325 euros at the beginning of 2020 to 6,900 euros today. An increase of 2,575 euros (+63%), which corresponds to almost two months of net minimum wage.
The explanation of this crazy flight is known. Car manufacturers were forced to reduce their production due to a lack of parts and, in particular, electronic components during the Covid crisis, and later due to the war in Ukraine. This shortage has forced dealers to impose long lead times, especially for the more affordable models that, due to their lower profitability, were no longer favored on production lines.
The average price of a new car has increased by 6,000 euros compared to 2020
Learning that they would be delivered in six, eight, or even twelve months, some motorists have switched to recent second-hand models that are immediately available. This caused their prices to rise and, by domino effect, this increase was gradually transferred to older vehicles.
Also, at the same time, manufacturers have increased the prices of their new cars, particularly for entry-level models, and the market share of electric cars, which sell for a much higher price, has also increased. So the average price of new cars purchased in France has increased at a rate never seen at least since the beginning of the century: +23% in three years, going, according to L’Argus, from 26,789 to 32,835 euros.
Second-hand car registrations fell 6% in the first quarter
But, if it increased too much, the price of cars ended up becoming prohibitive for a certain number of motorists, more and more numerous, who prefer to keep their old cars for longer. Undoubtedly, the arrival on the market of these famous electric cars is also expected at the 25,000 euros promised by the main European manufacturers.
And this attitude of waiting is now measured in the used vehicle registration figures: 82,000 fewer registrations in the first three months of this year compared to the first quarter of 2022. It is difficult not to see in this 6% decrease, the explanation for the long-awaited stabilization of second-hand prices. Due to a lack of buyers, the most greedy sellers have been forced to revise their ambitions downward.
Source: BFM TV
