There’s no doubt that you’ve heard stories about the chip shortage and the price of used cars going up. Even if you don’t know the whole story of what’s going on, you might be wondering, “is now a good time to sell my car?” If you are going to sell your car, should you sell it to a used car dealership or is another route the best way for you?
The short answer is, “yes.” Whether you’re looking to upgrade to a newer vehicle or just want to clear out some space in your driveway, the conditions are perfect. Of course, simply saying to yourself, “I should sell my car,” isn’t enough. You need to know how to get the best value for your used car.
Supply and Demand at a Used Car Dealership
One of the first principles you learn in business is the concept of supply and demand. If there is a high demand for a product, but that item is in short supply, the price will go up. Something that’s scarce has the potential to be worth a lot. On the flip side, if there is an abundance of available products and/or that product isn’t in high demand, the price will go down.
The COVID-19 pandemic can take credit for building a case study regarding supply and demand in the auto world. Just like other industries, the onset of this pandemic saw manufacturing slowdowns, layoffs, and delays.
The Great Chip Shortage
Many auto manufacturers expected to see a huge drop in sales. In response, they canceled orders for certain computer chips. These semiconductors are used in many of the electronics that are vital to a vehicle’s operation. It didn’t take long before these manufacturers tried to get their orders back in place. Of course, other industries were seeing a spike in sales and needed these chips as well: computers, smartphones, video games systems, and more.
There are only a couple of sites where these computer chips are produced. Out of nowhere, the demand skyrocketed. Throw in some general shipping delays, a factory shut down in Japan, and other logistical issues during the pandemic, and you have a massive chip shortage.
Manufacturers weren’t able to finish the production of new cars. Many carmakers had to shut down plants to focus on their most popular vehicles. New cars were simply in low supply.
Cars In Demand at Used Car Dealerships and new too!
At the same time that car production slowed, the demand for cars exploded. With the pandemic still in place, more families had to drive to take any kind of trip. People who relied on public transportation didn’t want to take the risk and decided to buy a car. New cars were in high demand, but they weren’t available.
Since shoppers couldn’t get new cars, they turned to used cars. Now used cars were in high demand, and used car dealerships couldn’t keep up with the demand. Even as new vehicles started to slowly come off the production line, car dealers scrambled to fill their inventory with used options.
These conditions make it a perfect time to act. Dealerships started paying top dollar for used cars in order to resell them. The demand is high, and the supply is low, so the price goes up.
How Should I Sell My Car?
You always have options when it comes to selling your car. Some people like to try and private sell their vehicles. This can sometimes be a great option, but it requires a lot of work. The biggest hassle is that you’re still going to deal with shoppers who will try to get a great deal. Used car dealers, however, are desperate to get more cars into their collection.
Selling to a dealership is one of the most straightforward ways to sell your car. They offer trade-in and pricing tools right on their websites. You can get a competitive quote without even stepping foot on the lot. They’ll also take your car as it is without demanding repairs or upgrades. Because there is such a high demand for used cars, dealerships are also likely to skip the haggling and hassling and get right down to making a deal.
It won’t be long before the chip shortage is over, and new cars are back in full swing. At that time, the demand for used cars will go down. Dealerships will still be interested in buying your car, but you may not get the same high price that you’ll get now.
If you’re asking yourself, “should I sell my car,” now is the best time to act. The best part is that you can get a no-obligation quote from your local dealer online. You have nothing to lose and only a great deal to gain.
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