LAS VEGAS — Increasing demand and a drop in the supply of used cars and trucks will lead to higher used-vehicle prices in 2012, according to Jonathan Banks, executive automotive analyst with the National Automobile Dealers Association (NADA) Used Car Guide.
“Consumers shopping for either a new or used vehicle will benefit this year from higher trade-in values along with loosening credit,” Banks said at a press briefing during the NADA Convention and Expo in Las Vegas. “For dealers, reliance on customer trade-ins will increase as they strive to meet the challenges of growing demand in a supply-constrained market.”
On a seasonally adjusted basis, the NADA Used Car Guide predicts used vehicle prices will increase by 1.8 percent by the end of the year, peaking in April and May, according to the company. Used vehicle prices increased 3 percent in 2011.
“The slowing rate of depreciation on used vehicles over the course of the year will lead to even stronger trade-in values and enhance the equity that a consumer has in their vehicle,” Banks said. Fuel prices hovering at $3.50 a gallon will increase demand for fuel-efficient compact and midsize cars with prices up by 2.7 percent and 2.1 percent, respectively, by the end of the year.
The NADA Used Car Guide predicts prices for large SUVs will increase by 1.4 percent this year, according to the company.
“A 15 percent drop year-over-year in the used supply of large SUVs will offset the elevated price of gasoline,” Banks said.
For more information, visit www.nadaguides.com.