Inflation hits US used-car market as prices soar

The US wholesale used-car market in November increased by 3.9 per cent compared with the previous month, far outpacing the country's consumer price index which rose 0.8 per cent to a four-decade high.

The Manheim Used Vehicle Value Index surged to 232.5 points this month – a 43.5 per cent increase year-on-year – despite the total number of used-car sales reducing by an estimated two per cent over the past 12 months.

At the current rolling average, the 2021 US used-car market is already more than 30 per cent higher than 2020, with one month left to go.

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Only the top-end of town has weathered the inflation storm surge. Major market indices show collectable cars have remained flat or declined in recent years.

The ‘affordable classics’ segment is the exception, which has continued to push higher over the same period, according to the K500 and Hagerty.

With many expecting reserve banks to hike interest rates in the coming months to rein-in inflation numbers, the result could help to push used-car prices lower, while making auto loans more expensive to pay off for consumers.