Editor’s Note — Check out Valerie Solanas’ article from CTO on how China’s exported inflation abroad could lead to higher prices.
According to PPI, wholesale used car prices have risen at their fastest rate in eight years.
In another major sign of inflation creeping up, wholesale used car prices have spiked since last month.
That means that a truckier economy and more competition amongst service providers are likely behind the rise.
Wholesale prices jumped by 6.7% year-over-year on the wholesale auto market, PPI’s latest report states. That’s the fastest pace since 2008.
Older models saw the biggest gains, however newer cars are seeing a smaller but still rapid pace of price increase. Newer cars had a price rise of 2.9% year-over-year, which is down from a 4.7% rise in the previous month.
Regional differences are also being highlighted in the new report. New York/New Jersey saw the biggest price growth, with a 16.2% rise in the wholesale price.
However, Midwest states saw prices stagnate, with just 0.2% increase year-over-year.
Bryan McMahon, PPI senior economist, tells CNN Tech “we are seeing increased competition, new and old, causing new vehicles to become more competitive and older models to become more competitive, bringing down prices.”
However, Anthony Nieves, chairman of the National Automobile Dealers Association, tells CNBC that price changes in old models could also be tied to trade-ins.
“The vehicles probably sold to individuals that have held onto those cars throughout the years,” he says.
This is good news for any old car buyers who plan to cash out in order to bring home some more cash over the holidays.