PHOENIX (3 On Your Side) — Car shoppers may find better deals on trade-ins than they would have a year ago, and several popular models have seen their trade-in values increase since the coronavirus pandemic began, 3 On Your Side has learned.
Currently, there is a shorter-than-usual supply of vehicles, both new and used, and dealerships are scrambling to get more used cars back on their lots, according to Matt Smith, the deputy editor of CarGurus.com.
“Those dealers, they’re feeling pressure to refill their inventories, particularly in their used car inventories and they see trade-ins as a huge opportunity to do that, so drivers can leverage what basically is a supply and demand problem to get a better offer on their trade-in vehicle,” Smith said.
There are a couple reasons for the supply and demand problem. First, when the pandemic started, production of new vehicles slowed or stopped all together and new inventory remains lower than usual. Smith says auction houses that typically supply a large portion of used cars have also scaled back re-conditioning services, which means fewer used cars are available, too.
“To put it simply, if you have a car to trade in today, particularly if it’s a popular car, something like the RAV 4 or Ford F-150, Chevrolet Silverado, you might find that your local dealership is willing to pay you more for that car today than they would have a year ago,” Smith said.
CarGurus.com Value Comparisons:
• The 2017 Ford F-150 has seen its value increase 13.05% since March from $28,541 to $32,265 in August
• The 2017 Toyota RAV4’s value increased 5.37% since March from $20,124 to $21,2014 in August
• The 2017 Chevy Silverado 1500’s value increased 14.62% since March from $27,299 to $31,291 in August
• The 2017 Jeep Grand Cherokee has seen its value increase 3.02% from $26,683 in March to $27,489 in August
• The 2017 Toyota Tacoma’s value increased 12.7% since March from $28,736 to $32,386 in August
Labor Day deal hunters will also likely have a different car shopping experience than they’re used to, including virtual vehicle walk-throughs, at-home test drives and video-chat negotiations.
According to CarGurus.Com, more than 9,000 dealerships that use that platform offer at least one contactless customer service option to meet customer expectations. A company survey shows 61% of prospective car buyers say they’d prefer contactless services.
“When it comes to negotiating for that car, find out if there’s a way you can do that with the dealership via Zoom or virtually,” Smith suggested. “Various options like that certainly make the car process this weekend and beyond a little more enjoyable and comfortable.”
Before consumers hit the car lot, whether it’s virtual or in person, Smith suggests researching financing and considering getting pre-approved for a loan.
“Financing has definitely tightened a bit over the past six months or so, and really what the means is it’s going to be harder for certain shoppers to acquire financing, certainly harder today than it was in 2019,” he said. “And as such just doing that research ahead of time, doing that preparation ahead of time is going to put you in a much better position when it comes time to buy the car.”