The age-old adage that the car drives itself off the lot isn't true anymore, mainly because for that to happen there needs to be cars on the lot.
Over the last two years securing a used vehicle has proved problematic for drivers, who are facing stiff competition and steep prices on the secondary market.
According to the Autotrader.ca December price index, 2021 saw continued price growth for new and used vehicles in Canada.
The average price of a new car also jumped by 12.7 per cent to $50,758, while the price of a used vehicle soared 34.5 per cent from a year earlier.
Warren Barnard, executive director at the Used Car Dealers Association of Ontario said he doesn’t seen any reprieve coming for drivers in the near future.
“There is no real light at the end of the tunnel,” said Bernard “People always complain about high prices and they often blame the merchants, but you gotta remember the dealers are also having a very difficult time finding inventory and when they do there's a huge competition on the wholesale marketplace.
This means when the dealers are paying higher prices to bring these used cars onto their lots, the consumers in turn are paying higher prices.
“Dealers are paying the highest prices they’ve ever paid for used vehicles and so they obviously need to pass that on to the consumers,” said Bernard.
This in turn is driving the prices up of the few available used cars, in some instances pushing them nearly on par with the price of a new car - albeit a lower-end model.
“There's multiple dealers trying to buy the same vehicles so prices have skyrocketed. You kind of have to stay competitive and try to offer as much as you can and that's jacking up the prices,” said Rob Fekhon, sales manager at Anew Auto Sales in Cambridge.
Cameron Giles, a resident of Acton, said he has been searching for a used car for some time now, but he is coming up short due to the limited selection and often hefty price tags.
“As we were discussing, the state of the used car market is obscene right now,” said Giles in an email about his search for a used car.” I called some local dealers looking for older model cars as I need a beater for the summer, but as it will be sitting for prolonged periods I don't want to spend a lot or finance anything."
Chalked up to a multitude of logistical and supply chain issues, there are not as many new cars hitting the dealers, which in turn is dampening the secondary market as there are fewer trade-ins.
Barnard said everything from supply chain issues, to part shortages and rental car companies keeping their cars instead of trading them in at certain mileage point markers is creating pressure on the used market.
"Realistically, anything reliably roadworthy is going to cost you at least 3,000 with most needing some kind of vague 'work' done to them and are being sold without safety even by small dealerships," said Giles in his email.
"Under 3,000 you're left with high mileage old clunkers, mixed with non-road worthy 'parts cars' even being listed as high as $2,000. If you look, you can find what you're after with good mileage and no major or non-cosmetic work required, but you'd better be ready to pay up to $5,000. For that price, it's almost cheaper to put that down on a new car and at least get a warranty, though it's tough to justify adding a new monthly expense in the form of car payments these days.”
– with files from CambridgeToday