The price of a car can fluctuate greatly, and there are many factors affecting this price. The number of new cars for sale in the US has decreased to just a fraction of what it was in the pre-pandemic years. This decrease in supply has given dealers and manufacturers less incentive to offer big discounts to attract buyers. When the alternative is no new car at all, buyers are willing to pay more.
In the past few years, the prices of used vehicles have increased dramatically. The demand for these vehicles has soared, so new vehicles are not selling as quickly. Prices for used cars have risen by more than double the price of new vehicles in the past five years. The soaring prices have encouraged first-time car buyers to buy, as many renters have started to consider buying a vehicle. However, the rising supply of used cars is causing prices to rise.
While the economy has rebounded in recent years, the car market is still under pressure. Many new cars come with higher prices than the ones in other countries. Many of these cars have components and raw materials from overseas. Tariffs on imported steel have allowed U.S. steel manufacturers to raise their prices. This has caused prices to rise in other countries. A new car, however, will not necessarily cost more than the one sold in the U.S.