Soaring Used Car Prices Named as Key Reason for Skyrocketing Inflation
The Bureau of Labor Statistics reports the cost of previously owned sedans, pickups, and SUVs climbed 10% in April, accounting for over one-third of the 0.8% CPI increase.

The Bureau of Labor Statistics reports the cost of previously owned sedans, pickups, and SUVs climbed 10% in April, accounting for over one-third of the 0.8% CPI increase.
The latest U.S. consumer price index (CPI) data shows inflation rose to 4.2% instead of the expected 3.6%, and some blame skyrocketing prices for used cars as the reason why.
The Bureau of Labor Statistics reports the cost of previously owned sedans, pickups, and SUVs climbed 10% in April, marking the fastest increase ever since 1953. This increase accounts for over one-third of the 0.8% CPI increase, experts report.
The automotive industry is making fewer new vehicles as automakers struggle with a critical semiconductor shortage and heightened competition for raw materials. In fact, top auto manufacturers warn that without needed chips, a potential 1.3-million shortfall in U.S. car and light-duty truck production will result.
As the semiconductor shortage slashes vehicle production, rental car companies began buying used vehicles at auction and retail consumers started meeting their transportation needs in the used car market.
The shift has caused wholesale prices to soar. Wholesale prices rose 54% in April over 2020 levels at Manheim, the nation’s largest vehicle auction company.
Riding inflation is not expected to continue, report analysts.
Economic analysts maintain the increase in used car prices will ease as production ramps up and demand subsides. In fact, economists predict a return to normal inflation levels of around 2% by the end of the year.
More Dealer Ops

Dealer Debrief: Defection Data & EV Updates
In this week's debrief, host Lauren Lawrence discusses how to use defection data to your advantage and the latest on EV sales and charging infrastructure.
Read More →
How Defection Data is Bridging the Dealership Conversion Gap
Lead volume is flat, cross-shopping is up and brand loyalty is in retreat. As confident sales teams keep losing buyers they thought they had, daily industry sales data is showing dealers exactly where their funnel is breaking and how to fix it without buying a single new lead.
Read More →
Dealer Debrief: Where are you losing customers?
In this week's debrief, host Lauren Lawrence discusses the hidden leaks in dealerships where you might be losing customers without even realizing it.
Read More →
Dealer Debrief: Improving Your Inventory Management
In this week's debrief, host Lauren Lawrence covers a new survey that shows what service technicians really want and two launches that could help improve your inventory and vehicle life cycle management.
Read More →
Ladies and Gentlemen, This Is a Dealership: Why the Fundamentals Still Decide Who Wins
A teaching moment by a legendary football coach happens to apply perfectly in the auto retail space. Learn what it is and how to use it to your store’s advantage.
Read More →
What Market Timing Mistakes Mean for Your Reinsurance Program
When volatility hits, dealer-owned reinsurance programs face a familiar temptation: pull back and wait for calmer waters. New data from BOK Financial shows why that instinct can quietly cost you years of surplus growth.
Read More →
Dealer Ads and the FTC
The agency has made it clear in recent enforcement actions and warnings, in auto retail and other industries, that advertised prices must include all nonoptional costs to the consumer.
Read More →
Used Autos Supply Dwindles
The March shopping surge, despite high prices, cut into inventory by the most since the thick of the pandemic, Cox Automotive analysts calculated.
Read More →
Managing Risk Effectively Through Changing Times
The variables influencing risk pricing have changed significantly over the past five years. Being proactive and responsive to emerging trends is not optional but essential.
Read More →
Survey Reveals What Won't Fix What's Breaking Car Sales
AutoPayPlus says extra-long auto loans are trapping consumers and threatening the dealer trade-in cycle, and that the industry is leveraging the wrong tools to combat high MSRPs.
Read More →
