How will the Car Market look in 2023 and Beyond?
Between shortage of computer chips, price inflation and the new agenda to push electric vehicles in recent times, there’s been a lot of changes to the car industry. In fact, in 2019 the recorded amount of EV purchases was 326,000! Then within in 11 months of 2022 the number skyrocketed to 724,000! There’s definitely been an incentive and curve of buying more electric vehicles. The American Automobile Association (AAA) stated that 25% of Americans are now more likely to purchase an electric vehicle for their next purchase.
Are newer EV’s simply more Valuable? Used car prices will fall, but the older cars will see the biggest decline in 2023. J.P. Morgan researchers opined that new car prices were likely to fall no more than 5% in 2023 while used vehicle prices could contract by 10% to 20%. The aforementioned chip shortage is keeping all new car prices high, and in the past two years, high new car prices have sent buyers flocking to used models.
The decline of online purchasing for vehicles. Although the big brand name, Carvana was at it’s peak in 2020 during the height of the pandemic. Since the movement of regular day-to-day living has become normal again, we see in the numbers that people still enjoy purchasing their vehicles in person. For numerous reasons. Speaking of numbers we can see that back just 16 months ago the price of a share in Carvana was $360 now being only $5… Conventional dealerships were slowly embracing a more online-centric model in 2019, but they were already aware of how many customers prefer to order a car online, even if they still want to test drive it.
Despite Carvana being a poor example of the online car industry in recent times, what had taken place is manufactures such as ford promoting EVs like the F-150 Lightning and making only participating dealerships sell them entirely online for a non-negotiable price. There are likely to be other manufacturers to follow in its footsteps. Chevrolet is also soon to be releasing a competitor to the Lightning, being the Silverado EV. Will Chevrolet and other manufacturers start selling solely online and for fixed prices, just like ford is? We have a feeling that may actually be the case.
It’s no mystery that times have indeed changed regarding the car market and industry. Manufacturers are promoting more electric vehicles, discontinuing the production of certain engines, and pushing to be more online. Interestingly enough, at least for the time being, people are likely to still purchase in person. If the number of electric vehicles has doubled over the course of the past couple years and poles have captured a quarter of people looking to make a purchase to say they are likely to buy an electric vehicle as their next purchase, and a lot of these new EVs are being offered for a very competitive price, we can see there will likely be an even larger increase in 2024!