Stable gas prices cutting into high mileage used vehicle value
Of course, the only things more volatile than gasoline prices are usually sports records, military secrets and perhaps nitroglycerin in liquid form. The point is you might wait to see what the summer brings before laying out the big bucks for some gas-guzzling muscle car – just a caution, you understand.
The tip comes from the National Auto Dealers Association who expects the resale price of compact and midsize vehicles to drop 5 percent next month, as part of a trend continuing through the summer, according to Jonathan Banks, a senior analyst with the NADA Used Car Guide. Those same cars saw their prices rise from January through April, but the bloom may have finally fallen off the market.
“Nationwide, gas prices are now averaging $3.71 a gallon — down 3.5 percent from a year ago — and well below the $3.94 a gallon average in April,” pointed out David Shepardson of the Detroit News Washington Bureau in a post earlier today.
Pundits are expecting SUVs, pickups and minivans to comprise a bigger part of total auto sales in May as the reduction in gas prices returned truck aficionados to the showrooms. When prices sink below $4 a gallon, it also makes it harder to sell EVs and plug-in hybrids, who many brands are just now introducing.
"The trend of rising prices for used cars will reverse course in June because of declining gasoline prices combined with a normal seasonal slowdown in consumer demand for used cars," Banks said.
According to the June edition of the NADA Official Used Car Guide, used-car values are expected to decline about 2 percent, while used trucks will only fall about 1 percent.