Used-vehicle prices at wholesale, dealer-only auctions in December 2021 ended 2021 at 48.1% higher on average than December 2019 and 34.8% higher than December 2020, according to KAR Global.
KAR reported the average wholesale auction price for all used vehicles was $16,026 in December, an increase of $5,204 over December 2019. Used trucks averaged $18,638 in December, 44.8% higher than December 2019. Passenger cars experienced an even greater percentage increase. The average used car was $12,084 in December, up 48.6% from. December 2019.
The auction retailer reported retail used vehicle prices do not necessarily follow wholesale auction prices 100%. But wholesale auction prices indicate what franchised, new-car dealers and independent, used-car-only dealers may pay for much of their used vehicle inventory. Those increases are typically passed on to consumers.
Dealers also stock their used-vehicle inventory with trade-ins and lease returns and buy vehicles directly from consumers and other dealers for resale.
Prices for used vehicles skyrocketed because pre-owned vehicles are in short supply when compared to demand. This will continue in 2022. Dealers produced fewer new cars in 2020, leaving fewer 2-year-old cars to sell in 2022.
Fewer used vehicles may also arise from consumers postponing new vehicle purchases. Dealers will receive fewer trade ins as a result. Another impact to used vehicle inventories comes from consumers buying used when they cannot find the new vehicle they want.