A Tale of Two Types: New Cars Abound;
Used Cars A Challenge

As the automotive market evolves, we see contrasting trends between new and used vehicles, according to the July 2024 Cars Commerce Industry Insights Report. New-car supplies are improving, but the used-car market continues to face challenges, particularly in the availability of late-model-year, lightly used vehicles. 

The electric-vehicle market is also undergoing significant changes, with new and used EVs experiencing increased inventory and softening prices. While consumers have a more comprehensive range of choices, new EV dealers are facing more competition. Meanwhile, the Cars.com Marketplace is seeing a surge in used-EV searches as supply improves and prices moderate, underscoring the growing interest in all-electric cars.

Over the past year, new-car prices have remained steady at around $49,000. Supply levels continue to increase, with the most significant inventory rise in mid- to high-priced  vehicles. Currently, there are just 333,000 new vehicles priced under $30,000 on the Cars.com Marketplace versus July 2019, when there were 1.1 million new vehicles. If the average new-car price had continued on its typical 3% annual growth rate from 2019, today’s average new car price would be $43,000. To get prices back on track, the industry would need to add more than 750,000 sub-$30,000 vehicles to the market, the same number of under $30k vehicles lost since 2019.

In contrast to the new-car market, the used-car market faces availability challenges, mainly sourcing low-mileage, lightly used vehicles. Year over year, used-car prices decreased by 6% and inventory edged up 1%, primarily driven by a welcome increase in the stock of vehicles under $30,000. Prices for used vehicles under $30,000 have dropped by 3% year over year, with inventory in this segment increasing by 9%. The availability of vehicles priced between $30,000 and $49,000 decreased 15% year over year, reflecting the scarcity of 1-to-3-year-old vehicles typically found in this price range. 

Notably, used vehicles priced under $20,000 now carry an average of 93,000 odometer miles as of July 2024, up 33% in the last five years. These high-mileage vehicles may require significant service to remain roadworthy. The shortage of low-mileage, lightly used inventory is especially noticeable in the higher-end used-vehicle market. For the over-$50,000 used segment, the average price is $77,000, which is more than the average cost of a new luxury vehicle.

Overall, the market continues to feel the effects of higher prices, and consumers and dealers alike will need to adjust their perspective to accommodate this new and persistent reality. 

*A third-party cyber incident impacted dealer inventory data beginning June 19, 2024.

Rebecca Lindland
Sr. Director of Industry Data and Insights, Cars Commerce