At the start of the year, new and used car prices were soaring. Nobody had ever heard of a 40% inflation rate for used cars, yet an acute shortage of semiconductors threw the car market into disarray. With chip shortages severely depressing new-car production, consumers with plenty of cash shopped used instead. So prices skyrocketed.
With the chip shortage easing, car prices are falling back to earth. The year-over-year change in new cars peaked at 13.2% in April and has now dropped to 8.4%,…
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