Americans use cars for the longest duration

23 May 2023

For the 6th consecutive year, the average age of cars has set a new milestone of 12.5 years, which has significant impact the used car market.

Hiện có tổng cộng hơn 284 triệu ôtô đăng ký lưu hành ở Mỹ. Ảnh: CNBC

According to the annual research of S&P Global Mobility – a company specializing in providing auto industry data – the average age of cars has increased by 3 months compared to the figure of 2022. This is also the 6th consecutive increase since 2018 was recorded in the US, where there are more than 284 million cars in circulation.

After the impact of the Covid-19 pandemic on the auto market, new cars remain expensive, with an average list price of $47,409 in April, according to Cox Automotive. Car manufacturers are prioritizing profit over market share and taking advantage of it at a time when most customers will agree to buy whatever car they can get.

The inventory of both new and used cars is almost completely empty, and the waiting time for new cars is becoming longer and longer. With economic disadvantages as well as drastically rising interest rates, many people decide to simply hold on to what they already have while they wait for better opportunities.

But the older the car, the more it needs maintenance and service — a boon for the auto repair sector. The parts business also increases opportunities as drivers keep their cars longer, as they will need replacements as the car ages.

This situation can create supply and demand problems. If more drivers need to fix their cars, the wait time for the car to be repaired will be longer, and the cost will also increase.

Customers in the used car market also face difficulties since fewer used cars will be sold. The selling price of used cars may also increase. In April, the average list price of a used car was $4,26 — stable but slightly higher than before the pandemic.

Therefore, by the time these older cars go on sale, customers will have to choose between older cars than before, with a larger mileage than usual. This means that the actual situation will have a long-term impact on the auto market in the US.



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