Automotive production is ramping back up as it tries to meet recent consumer demand post-pandemic.
According to data gathered by AutoTrader, the average price of a used vehicle increased 38% to $37,768, the highest ever recorded to date. The average price of the new vehicles also grew 17 per cent, rising to about $53,000 for the first time through April of 2022.
Price increases are more prominent for SUVs, minivans and trucks, consistent with research, suggesting Canadians are increasingly looking to buy larger vehicles, with minivan prices increasing at the fastest rate given shortages in the segment.
AutoTrader director of marketing intelligence Baris Akyurek says in Saskatchewan and Manitoba, those numbers were up 36 per cent and almost 20 per cent respectively
“The average price of a used car in Saskatchewan and Manitoba is $39,281 and the average price of a new car/vehicle is $56,572,” said Akyrurek.
The increase in allocation for demand and filling customer orders as pre-orders are a prominent means of business for consumers as supply chains have caused back-ups for dealers, meaning you may not drive off the lot the day you want a new vehicle. You may have to wait.
“We don’t expect us to get inventory levels we had before the pandemic until sometime next year,” said Wyant. “That is new, as they originally had 2022 in mind for this to happen, says Wyant Group COO Michael Wyant.
Due to the COVID-19 pandemic, driver habits changed with more people wanting to buy their own means of transportation instead of using public transportation. They had the ability to do this too as many people had funds saved up due to lack of travelling and overall daily spending.
“Due to the lack of travelling and bigger expenses the bank of Canada says there is roughly $200 billion of additional money in the Canadian economy from savings during this time,” said Akyurek.
Prices are up for SUVs minivans and trucks, the more popular options for consumers.
AutoTrader says that suggests Canadians are looking for bigger vehicles. Minivans, electric vehicles and many others also are seeing shortages in stock also being a factor in the price increase with less on the market, particularly in the case of minivans.
Wyant says with the price increase, customers are still in an okay position, despite their shopping habits being altered.
“We are seeing more vehicle financing for longer durations of time, so people can fit their vehicle into their budget,” buyers are being more patient, but with that getting the exact vehicle they want, even it means waiting a longer,” said Wyant.
Wyant says anyone looking to trade in their vehicle is also benefiting as used vehicles’ prices are high, as high or above where they have been before.
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