As a result, many are turning to used cars instead. This, in turn, has pushed up the prices of used cars.
Lightly used vehicles – those with a few years and low mileage – now sell for between 75% and 80% of their original sticker price, said Ivan Drury, auto industry analyst at Edmunds.com. As late as 2019, a more normal year, these cars would have 65% to 70% of their original price.
“If someone has a second, third, or fourth vehicle or whatever they don’t use, they can definitely take advantage of it right now,” said David Paris, vehicle valuation analyst at JD Power.
Keep in mind that you probably won’t get 70% of the vehicle’s original price at a dealership, Drury said. “But, at the same time, it’s a huge indicator that there is a lot of value out there.”
A dealership who buys your used vehicle needs to leave some leeway to make a profit after repackaging and marketing it. The key is how to maximize the value of your vehicle.
You can sell it yourself, of course, then all that profit will go straight into your poached. But you have to balance the extra money you’ll earn against the value of your time and the aggravation of dealing with all those potential customers yourself, said Matt Degan, editor of automotive website KBB.com.
“If you’re selling to a dealership, you don’t have to worry about running into someone in a parking lot and doing everything that’s a private sale and everything in there,” he said. “The dealers, they buy and sell cars for a living. They know what they’re doing. They’re going to have all the paperwork done. The T’s will be crossed out and the I’s will be dotted.”
But don’t go to one or two dealerships.
For starters, there are several websites that offer an appraisal of your vehicle’s value and even firm offers to buy it. CarMax, Carvana, TrueCar and others will tell you how much they, or the dealerships they work with, will pay for your car or truck. But that alone may not give you the best price, several experts have said.
Much like their customers, auto dealers have different needs and wants depending on where they are located and the types of customers they serve, so it’s a good idea to check with individual dealerships in your area, a said Matt Jones, director of industrial education at TrueCar.
For example, a Ford dealership in the Midwest or South will likely see more demand for trucks. And with a low inventory of new trucks to offer, this dealership will have a great incentive to buy your beautiful used F-150 or Silverado. A Honda dealer might also be quite willing to buy it, but they or they might not be willing to pay that much.
When you take your vehicle for an in-person evaluation at a car dealership, you’ll want to make sure it looks well-maintained. But don’t go overboard, said Jones, who said he spent years working at car dealerships. Don’t pay to have your car detailed – that is, thoroughly cleaned inside and out – before you take it to a dealership, he said. It just makes you look desperate.
“Anytime someone walked in with a freshly detailed car or the glove box was completely empty, you could still see the vacuum marks and the car was glowing,” he said. “We knew this person was keen to get things done then and there, so we didn’t have to bend over backwards.”
Any dashboard warning lights, like a “check engine” light, should definitely be attended to before having the car evaluated, he said. This is true even if you are sure it does not matter. It’s just not a good look.
Also, eliminate odors. You can don’t notice the scent your dog has left behind, but an assessor will. If you have a sheltered place where you can do it safely, he said to leave the car with the windows open for a few days and maybe give it a squirt or two of air freshener, Jones said.
“It’s $ 3 well spent,” he said.
Even if you’re not seriously thinking about selling your car right now, Drury said, it’s a good idea to go online regularly and keep up to date, in general, on what your car is worth. Car prices are not expected to return to normal very soon, he said. As you watch, keep in mind what this car costs you to maintain and insure.
“At a minimum, you’ll know how much it’s worth,” he said. “And, at the same time, you might actually find out, yes, it’s not worth having at the same time.
Correction: An earlier version of this story gave the wrong last name to David Paris, a vehicle valuation analyst at JD Power.