Second-hand car prices soar during the coronavirus pandemic, with Australians avoiding public transport
Second-hand car prices soar 25 percent during the coronavirus pandemic, with Australians turning their backs on public transport for fear of getting the virus
- The demand for used cars has skyrocketed during the coronavirus pandemic
- Lower fuel prices and fear of public transport led Australians to buy cars
- The value of second-hand cars has increased by 25 percent compared to last year
Second-hand car prices have skyrocketed since the start of the pandemic, with Australians avoiding public transport for fear of getting the coronavirus.
The huge demand for used cars during the COVID-19 crisis has pushed their value up by at least 25 percent compared to August 2019.
Used car prices were up 11.2 percent and car prices were up 10.6 percent from April to May, according to Australian vehicle data from Moody’s Analytics.
Demand for used cars soared during the coronavirus pandemic in which Australians (woman in a Sydney bus pictured) pushed the price up by 25 percent compared to August 2019
The surge in demand for used cars (Melbourne car dealer pictured) was prompted by lower fuel prices and fears of COVID-19 in public transport
The record annual growth comes after cars initially depreciated at the peak of the April pandemic.
The staggering increase has also surpassed the 20 percent increase in value seen after the global financial crisis in 2009.
Auto Economist at Moody’s Analytics, Michael Brisson, said: ‘low fuel costs and a decline in the use of public transport ‘had pushed up the cost of used cars.
“Consumers will continue to prefer driving to public transport, while a vaccine or treatment option for COVID-19 remains elusive,” he explained.
A research report from Moody’s found that lower gasoline costs during the pandemic had also improved the overall cost of car ownership.
The price of used cars rose year-round, up 4.7 percent in July and 7 percent in August.
Moody’s analysts explained that Australians continued to buy cars to avoid public transport.
‘The increased demand for vehicles comes from people who have continued to avoid group mobility.
The price of used cars is expected to remain high in 2021 as Australians continue to avoid public transport (women in masks at a bus stop in Sydney) over fear of the coronavirus.
“This change of preference is in response to a fear of contracting the virus or, in some cases, not wanting to deal with the hassle of increased precautions,” the report said.
The pandemic has pushed the wholesale car market by at least 23 percent and prices up 32 percent, compared to lower values in 2018 and 2019.
This demand for used cars and the avoidance of public transportation has also been recorded in other wealthy countries around the world, including European countries and the United States.
Brendon Green, general manager for motor vehicles at the used car company Pickles, said it was common for the demand for used cars to increase during a crisis.
“We expect prices and sales of used cars to remain quite high for a while, possibly until 2021,” Green said. The Sydney Morning Herald.
“We always find that buyers are drawn to used vehicles in difficult economic climates or when consumer confidence is low because they are watching their budget.”
A similar trend to buy used cars and avoid public transport has also been observed in other wealthy countries in Europe and the US (woman pictured on a Sydney bus)