Car Prices Expected To Go Up If Economy Improves

LAS VEGAS -- Car buyers will likely pay more for new and used cars this year as the economy improves.

That's according to the National Automobile Dealers Association, which predicts the average price of a new car will rise 6 percent to $30,000. Used prices will jump as much as 8 percent for pickups and SUVs. The average price of a used small car, like the Honda Civic, will increase 1 percent to $9,475.

More people are expected to splurge on new luxury cars as the economy improves. By contrast, used cars are in tight supply because so few people bought cars during the recession.

NADA chief economist Paul Taylor expects U.S. vehicle sales to rise 9 percent to 13.9 million this year. New products and low interest rates should help boost sales.

Comments

[DismayedRepub]

04:39 PM on 02/06/2012

Expect the prices of everything to go up once the economy gets better. The FED and U.S. Treasury have been inflating the money supply to the tune of over three trillion dollars over the last four years. The only reason prices on nonessentials haven’t risen is due to Demand Destruction. Once demand comes back prices will skyrocket. We’ll have to compete for food and energy on the global market with debased dollars. People will starve.

[Marcin A Mazurek]

01:46 PM on 02/06/2012

wouldn't an increase in prices reflect an increase in interest on most savings, and adjust for the new inflatation rate?

[DismayedRepub]

04:43 PM on 02/06/2012

I doubt it. Prices are affected by both inflation and demand. While the government uses the CPI to gauge inflation, since 2008 it has really been a measure of Demand Destruction. No one has any savings and most of the inflation has already occured.

[Marcin A Mazurek]

07:29 PM on 02/06/2012

then...wouldn't a lack of demand drive prices back down to where they were, and probably lower?

This isn't the recession of "my new car every year"

[marinfan]

05:45 PM on 02/06/2012

Prices and interest rates are inversely related. It's why the Fed has been targeting low interest rates for the past decade...to push asset prices up in financial instruments, commodities and real estate while diminishing the pain of the debt the Treasury has to take out to pay for things like Wars, Medicare, Social Security, Corporate Subsidies, Farm Subsidies, Energy Subsidies and on and on and on....

What must go up must come down. The further it goes up the harder it will fall.

[Timma]

10:55 AM on 02/06/2012

...corporate greed proving once again they don't want to give average Americans any breaks...bass terds!

[MrStat1]

01:37 PM on 02/06/2012

Start your own company and see how easy it is.

[Timma]

03:41 PM on 02/06/2012

If I'd a knowed it was so easy I guess I would've...

[frank day]

09:26 AM on 02/06/2012

We have two 2003 model year vehicles.

One has over 100,000 miles and the other is approaching 200,000.

We recently decided to have the engine in the high mileage one overhauled rather than replace it.

It would cost about $36,000 to buy a comparable vehicle new and we'd have to pay large sums for

insurance and registration.

It makes more sense to keep what we have.

[ruburnt]

09:18 AM on 02/06/2012

Auto sales are DOWN in our region...

[ringo3khan]

08:33 AM on 02/06/2012

Interesting dynamic at work here. In order to "live safe", most U.S. residents find it necessary to live many miles from their place of employment. Thus they must buy/have automobiles to get from and to work. Many employers require an employee have "reliable" transportation as a condition of employment. With globalization and export of higher paying jobs the U.S. has entered the era of the Barista economy. Barista's can't afford to buy automobiles. That, coupled with perrinial high unemployment which has caused the "failure to launch" generation to stay home with parents has meant, according to recently released statistics, that there are actually far fewer cars in circulation than 10 years ago. That has caused the used car prices to soar. Soaring national debt, (intentionally created) will prompt the devaluation of the useless script known as the U.S. Dollar causing inflation of car prices. All in all, this will mean a steady decline in U.S. Americans quality of life and standard of living EXCEPT for the people participating in the burgeoning underground cash/commodity (stolen) economy.

Welcome to the next Brazilian economy without the vigor of growth or competent government and relative social stability.

[frank day]

09:21 AM on 02/06/2012

2000 : 225 million vehicles

2009: 254 million vehicles

http://www.bts.gov/publications/national_transportation_statistics/html/table_01_11.html

[ringo3khan]

01:17 PM on 02/06/2012

According to researchers at Michigan-based Polk, there are 240.5 million cars registered for use on roads in the United States, the highest number since before the economic recession began in 2009.

According to researchers at Michigan-based Polk, there are 240.5 million cars registered for use on roads in the United States, the highest number since before the economic recession began in 2009.
http://www.leftlanenews.com/number-of-cars-on-u-s-roads-rises-for-first-time-since-08.html
2011-240 million vehicles.

[ILoveGreatDanes]

05:48 AM on 02/06/2012

I always buy a used car and pay cash for it. I save tons of money that way. The new car smell fades long before the payments and comp and collision costs do.

[mrcontinental]

05:35 AM on 02/06/2012

Prices will go up anyway lol, they always go up whether people can afford them or not.

There are people out there who are basically paying a mortgage on a car. Anything greater than 72 months is a mortgage as far as I'm concerned.

[Carl Crooks]

04:31 AM on 02/06/2012

retail sales cap

[frankieshoes1]

03:05 AM on 02/06/2012

All the more reason to start investing in mass transit.

[ringo3khan]

08:17 AM on 02/06/2012

And a CHL.

[KarmaPatrol]

12:46 AM on 02/06/2012

With the distracted and kwappy drivers out there now, I'm not sure about an expensive car. When it's totaled, the insurance sees whether to total it or try to rebuild it.

After flipping and rolling a $20,000 vehicle, the adjuster came within $800 of trying to rebuild what was left (a scrap-metal burrito with the remnants of my soda spattered around the cab).

[EdCorner]

11:55 PM on 02/05/2012

Thank Bernanke for his targeted inflation that makes the things we need cost more and the things we don't need cost less.

[DismayedRepub]

04:47 PM on 02/06/2012

Don't worry, this will all even out. Once the economy and demand pick up everything will cost more.

[EdCorner]

05:10 PM on 02/06/2012

That's supposed to be heartening?? lol

[fifthmansix]

10:29 PM on 02/05/2012

i guess they don't want to sell any new cars , no raises in thirty years and then raising prices ? forrest gump c.e.o. i guess . time to get out of the bubble GOP ,have you seen detroit lately? i guess not by this posting. i will keep my old car running for a few more years at this rate. the new cars suck anyhow.

[tacevad]

08:25 PM on 02/05/2012

a car is a necessary evil for most of us, it is also just about the Worst investment you can make if you are buying new... toss a couple grand out the window driving off the dealers lot? Have to take out a 72 month loan to buy? Or just pay the lease and have nothing when it is done(that makes figuring cost of driving easier at least)

[loki]

08:02 PM on 02/05/2012

lets see, in this "new economy" wages are a lot less than they were before the wealth transfer to the richest happened. So raising auto prices on cars that already cost 20 grand and more on people who dont make nearly as much as they use to just seems kind of destructive for the auto companies. Unless they have some kind of subprime lending scam in the works. But we all know how that works out.

[Kali03]

05:25 AM on 02/06/2012

Precisely. I read the comment "More people are expected to splurge on new luxury cars as the economy improves" and wondered what sort of dreamland is anyone in that they expect "splurges" on luxury cars. Mitt Romney can buy a few more cars and as many dogs to strap on top of them as he wants while he's at it. But the average person is not going to be running out to buy a Lexus if the DOW rises.