Car Buying Experience Hurt by the Dying Art of Haggling
Car buyers are getting crushed by the rapid increase in the cost of new and used cars, but my dad’s old-school negotiating techniques might offer some relief.
Thanks to the rippling effects of the pandemic and the lockdowns, it’s harder to find a new car to buy in the first place.
As USA Today explains, our current car troubles started with a global shortage of the computer chips that power the magical products that connect, transport and entertain us.
As chip plants were shut down last year and demand for consumer-electronics products soared, the chip shortage got increasingly worse.
Now it’s so bad that USA Today says the auto industry has been forced to shut down its factories “because there aren’t enough chips to finish building vehicles that are starting to look like computers on wheels.”
Some dealers are using the shortage to charge far above sticker price for new cars — justifying the practice because, they say, they now have fewer new cars to generate the profits needed to cover their operating expenses.
In response to this sticker shock, more car shoppers have begun searching for used vehicles — causing their prices to jump too.
CNN reports that through May used car prices had shot up 30 percent in the previous 12 months — almost breaking the previous record one-year increase set in 1975.
More young people are using online car-buying services, such as Cars.com, Shift, Vroom and Carvana, to buy used cars.
I wonder if a non-economic trend is at work here that has some part in abetting the spike in car prices: that fewer Americans are willing to negotiate face-to-face with salespeople to get the best possible deals.