SIOUX FALLS, SD (KELO) – Walking past a car dealership the last few days, you might have noticed a difference. In many cases, the sparse and half-empty batches caused by a global shortage of computer chips that led automakers to cut production are gone.
This shortage of vehicles has resulted in increased costs across the market for both new and used vehicles. As of June 2021, the price of used cars in South Dakota had risen 32.8% to $ 8,507.
While there are signs the auto industry is rebounding in terms of supply, Brad Dumdie, owner of Sioux Falls-based used car dealership Autoland, says supply stabilization may not lead to a lower prices before the pandemic.
âTime will tell,â said Dumdie, âbut I think right now we are experiencing inflation. Often people think that car prices are going up and they’re going to crash and come back, but I tend to think we’re going to see some inflation – what used to be a $ 10,000 used car is now a $ 12,000 used car and will probably stay there depending on inflation. “
Dumdie says the auto market is rebounding.
âI can see it starting to come back, starting with the trucks – manufacturing from the pandemic is starting to take off,â he said.
However, Autoland still does not operate with a full inventory. “I usually try to keep a hundred [vehicles], give or take, and we probably ran over 80 or 90, “he said,” so we weren’t very far away, but it looks like it’s running faster. “
âThis entire year has been short of inventory. It was a little hard to find, âsaid Dumdie, who says this problem is because dealerships who usually sell mostly new vehicles also have low inventory. “They buy a lot of second-hand and trade-in products because they have nothing to sell.”
âI buy a lot of non-rental cars,â Dumdie said. âCars that people have leased for two to three years, and the manufacturers or the dealer who leased them usually have the first chance – a lot of these dealerships buy them before they get to auction – we don’t have the option. to buy them.
While the shortage of vehicles over the past year has pushed up the price of new and used cars, it has also had an effect on trade-in value. âIt does fade a bit at the end – it certainly made used car prices go up, but on the other hand, it also pushed up the price of people trading,â Dumdie said.
If you’ve been waiting to sell your car, hoping it will increase in value though, Dumdie says now may be your last chance.
“We see these [trade-in] Kelly Blue Book’s already falling prices – with strong manufacturing and sales likely dropping a bit during the winter months – now would be the time, âhe said. âIf you’re trying to sell your car, you want to do it now. “
Despite the challenges, Dumdie says 2021 has been a good year. âIt’s been different in terms of inventory status and inventory prices, but interest rates have been low and most people are funding to keep it consistent. In 2020, obviously, we went through a period where there was just no business – there was a time when it was really bad, but then it started to pick up and it just didn’t. not stopped since. “