Report: Used cars are same price as new cars, forcing buyers to get new

2011 Chevrolet Corvette

A new study is out from Edmunds that found some new cars are nearly the same price, if not cheaper in than their used models.

For example, BMW’s 2011 3-Series and M3 sedans cost $34 more a month to acquire than one-year-old used models. Another example can be found with the Chevrolet Corvette, which is $12 a month cheaper to buy new than used.

According to Edmunds, this can be attributed to the industry shortage of used cars in the US of A. And that was being caused by the manufacturing cuts of manufacturers and decreasing sales in the last three years.

“There’s a substitution effect going on between new and used,” said Paul Ballew, chief economist for Nationwide Mutual Insurance Co. “When you get those price gaps closing, you get people that are willing to shop new that wouldn’t have before.”

In other words, people are almost being forced into new cars because of the high residual prices of their used counterparts.

– By: Chris Chin

Source: Automotive News

Chris Chin

Chris Chin is the Editor-In-Chief of egmCarTech and is a regular contributor to Automobile Magazine.

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