If you’re looking to buy a new car, you’re probably wondering why used trucks are so expensive. People wonder if buying used is worthwhile or if they should just look for a new car since the price difference between new and used is not great.
May 2022 saw an average price drop for vehicles between one and five years old to $34,199, which isn’t much of a relief for those looking to purchase a car. What’s going on, and should you simply buy new? These elements affect used truck prices.
Is Purchasing A Used Truck Worth It?
Used trucks still cost less than brand-new trucks, despite the current price increase. Additionally, it’s frequently cheaper to find trucks with more features than it would be to buy a brand-new vehicle with the same features.
The truth is that once a new truck is driven off a lot, its value quickly drops and then stabilizes after the first few years. By purchasing a used truck, you have effectively avoided the initial depreciation period and entered the market when prices were leveling off when your investment was expected to hold up reasonably well.
Trucks also have a long lifespan and a solid reputation. Even if you’re considering a model from ten years ago, you’ll probably get a lot of use out of it before it’s time to start looking for a new car again. Compared to standard vehicles, which have a lifespan of 100,000 miles, trucks, when properly maintained, last an average of 200,000 miles.
Many used trucks still have their factory warranties in effect. Don’t forget to take that into consideration when weighing the price of the vehicle.
Benefits Of Buying A Used Truck
Think about these main advantages when deciding whether or not to buy a used truck.
- Cost savings, including lower taxes and fees upon purchase
- Avoid initial depreciation of a new vehicle
- Lower insurance costs compared to new vehicle
- Less expensive way to get added features and options
- A larger selection of models and years to choose from to get exactly what you want
Drawbacks Of Buying A Used Truck
While buying a used truck has many wonderful advantages, there are some drawbacks as well.
- Not made to order, meaning you might not get all the features you want or your first choice for interior and exterior colors
- Limited or no warranty depending on vehicle age
- Possibly lower fuel efficiency compared with newer models
- More maintenance is required on aging vehicles
- Less financing options
- The vehicle could be equipped with older technology
When Will Used Truck Prices Start To Fall?
Even the professionals are uncertain. The initial estimates for increased auto production in 2022 were overly optimistic. Computer chip shortages are anticipated to last well into next year, according to Bloomberg News and the Biden administration.
Since so many of these expensive machines are needed for auto manufacturing, it is unlikely that used truck prices will decrease significantly in 2022.
The good news is that the industry will bounce back eventually. According to Kelly Blue Book, used trucks will become more reasonably priced once production picks up again.
It’s annoying that used trucks are so expensive when prices are rising on almost everything. Consider ordering a brand-new economy truck with no frills if you need a truck within the next year, or take advantage of any exceptional deals you come across. Waiting is still an option, but don’t expect used car prices to decline in 2022.
Why Used Trucks Are So Expensive? (5 Reasons )
The features of today’s pickups include light-duty, heavy-duty, hybrid, diesel, off-road, and luxury. A quad-cab is available if you want a family vehicle. Do you need to tow a horse trailer or boat? You can get packages hauled. However, these used truck prices are exorbitant. Here are the top five reasons why used trucks are so expensive.
Trucks Demand Is Still High
Any product’s price rises and stays high when consumer demand for it increases and it becomes highly desirable. According to Forbes, new trucks are outpacing new cars in sales as of January this year by a factor of three. According to Vehicle History, the most popular vehicle in 39 out of the 50 states is a pickup truck. That’s partly due to the pickup becoming a new luxurious, family-friendly, and daily driver vehicle. Customers enjoy using their powerful trucks for work and off-roading. But the trucks of today make use of even more resilient materials, cutting-edge technology, and plusher touch points.
Used Trucks Aren’t That Much Cheaper
The old saying that buying used would save money is false because used truck prices aren’t all that different from new truck prices. The average cost of a used truck will be $40,000 in 2021 due to recent price increases. Some pickups cost more than brand-new models because they have more powerful features and capabilities.
Longer Loans Make Trucks Feel Affordable
If you only consider the commitment to make monthly payments to purchase a truck, trucks may seem more affordable. But don’t let your guard down. As Gear Patrol notes, loans are getting longer, so those truck payments are essentially reduced. In the past, a typical car loan would last for three years. However, some consumers are now financing for five or even seven years in order to pay for a vehicle they most likely wouldn’t otherwise be able to afford.
The Famed Chicken Tax Is a Reason Why Used Trucks Are So Expensive
The Chicken Tax is another element that raises the cost of used trucks. Large automakers had to contend with fierce competition from foreign producers. The U.S. responded to the European Union’s tariffs on chickens by imposing its own. In 1964, S. responded by enacting the “Chicken Tax.” To safeguard the domestic truck market, this tax is still in effect today and adds a 25% tariff to foreign light pickups. The U.S. must be used for the construction of Nissan, Isuzu, and Toyota trucks if they want to reduce costs.S. soil.
Manufacturers Have The Option To Reduce Or Eliminate Incentives
In contrast to conventional production line fleets, trucks have different incentives and bonuses. Automakers have a different strategy for pickups when they change the MSRP of their lineups to match market demand. Instead of lowering the price at which a truck can be purchased, manufacturers will offer cash back, special financing options, and other “buy now” incentives that give the impression that customers are getting a deal. The MSRP is ultimately not being reduced at all.
Conclusion
Even though the cost of used cars has gone up in the past year, buying a used truck is frequently still worthwhile to prevent the initial depreciation that occurs when you drive a new car off the dealer’s lot. To make your investment worthwhile, you simply need to carefully choose the model and year to ensure that you get the most durable vehicle. The best way to prevent used truck buyer’s remorse is to take your time in the search for the best model and have the patience to wait until the model with the features you want is offered for sale.