Used car glut good news for U.S. car buyers

Used car glut good news for U.S. car buyers

Oversupply of second hand cars proves boon for car buyers…

The effects of a strong spike in new car sales from 2014 to 2016 in the U.S. is starting to be felt with used car values dropping dramatically.

As many as 12 million cars are coming off lease this year and most are expected to end up on used car lots that are already bursting at the seams after seven years of record new car sales.

The oversupply of used cars in the U.S. is a bonanza for buyers with used car prices expected to fall at least 3% per annum over the next few years.

While GM and Ford has reported around a 7% decline in the value of the used cars in stock in their dealerships in just the past year.

An over-supply of second hand cars is bad news for sellers.

While the issue is also being blamed for the stagnant share prices of the big three automakers (GM, Ford, Fiat-Chrysler) in the U.S. at the moment.

The slowdown in new car sales in the U.S. in recent times has spurred manufacturers to cut prices and offer generous financing deals.

Industry analysts, J.D. Power, say they haven’t seen car companies this keen to make a deal since the Great Recession at the latter part of the last decade.

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