Car sales are down around the country, with about a quarter of a million fewer new cars being sold this year, according to Tasmanian car dealership owner Errol Stewart.
That also directly impacts your chance of picking up a privately sold used car for a bargain price.
Gone, at least in the meantime, are cars by the side of the road with a phone number and asking price scrawled on the windscreen that are offered for private sale.
Car dealers are increasingly buying direct from the public due to trade-in car numbers decreasing and their new-car sales declining.
If you are selling a car via an online sales platform Mr Stewart says it is probably a dealer contacting you “because we need the stock”.
“It is a very good time if someone wants to come in and bring a trade-in because we’re not getting the trade-ins,” he said.
“It’s not just our business, but every car dealer across the state is in exactly the same position.
“Used cars are in tight supply,” Mr Stewart said.
Less new cars coming into the country
Mr Stewart said people were not buying as many new cars and less new cars were coming into the country.
“Just about every manufacturer has had some shortages in one form or another, so there are not as many new vehicles coming in to Australia,” he said.
“Consequently, people are seeing less new cars for sale, and saying, ‘I can’t get the new car I want, so I’ll buy a used car’.”
Those who have bought a new car in the past would, more often than not, trade it in for their current car, and accordingly, less second-hand cars are being made available to the dealers.
“We’re not selling as many new cars, but we are selling plenty of used cars,” Mr Stewart said.
“We’ve gone from about 12,000 back to 9,000 sales so there are 3,000 cars that haven’t been sold as new cars in Tasmania.”
Strong luxury car market
The new cars that are still being bought are top-end vehicles.
Mr Stewart believes that this is because the customers who are in the market for luxury cars are not spending their money on travelling due to the coronavirus.
“People who buy the upper-end products are not travelling and they have more disposable income,” he said.
“They might normally say, ‘We’re going overseas,’ and spend $20,000 to $30,000 but they are putting that towards buying a car.
“Instead of buying a run-of-the-mill car they might buy a more luxurious brand.
“The luxury market, particularly in Hobart, is much stronger for us than last year.”
Superannuation used to buy cars
Mr Stewart is also seeing purchases of new cars made with superannuation that has been accessed during the pandemic.
“A customer may have taken $10,000 out of super, saved up another $10,000 and borrowed $10,000 to buy a $30,000 car,” he said.
“That’s certainly been very evident — and fairly so — it is their money at the end of the day.”
While there are changes happening in the used car market, Mr Stewart is confident that consumers can still find what they need.
“I’d just shop around and do your homework,” he said.
“There are plenty of good cars and it’s still a very competitive market place.”