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Used Car Prices Expected to Increase From Hurricanes - KOAM TV 7

Used Car Prices Expected to Increase From Hurricanes

Updated:
Joplin, MO -

Another destructive hurricane could even impact our nation's auto industry.  Experts expect a market favoring auto sellers because of supply and demand.

Chloe Smith has been looking since May for a used car.

"Cars are already expensive, even used," says Smith.

Some bad news for people like Smith...

"As supply is limited, prices go up," says Jim Adams with Frank Fletcher Toyota in Joplin.

Three to one.  Remember that.

"There's always going to be, transactually, way more used cars sold than new cars sold.  Three to one," says Adams.

Car dealership managers and sales workers say this simple ratio points to a big domino effect in the auto industry.  As many as one million vehicles were destroyed by Hurricane Harvey.  Hurricane Irma could add to the tally.

"If there are three million less used cars, prices will go up nationally," says Adams.

"I need to get a car today!  Get it over with," says Smith.

Car dealerships expect hurricane survivors down south to venture northward, through the Four State region, for mostly used cars.

"They're just going to need a car that moment that can get them through this terrible time they're having," says Joseph O'Malley with Pittsburg Ford.

"We saw that in Joplin, after the tornado," says Adams.  "People went to St. Louis, went to Chicago, because there was no inventory here for a long time."

But there's a flip side to the situation.

"It's definitely going to help your trade," says O'Malley.

Dealerships predict it'll soon be a seller's market.

"If the cars start getting higher, their trade-in value paces with that," says Adams.

Chloe Smith doesn't have a vehicle to trade in.  

"I don't really think a lot about cars, outside of just trying to get one," says Smith.

Now that Smith is trying to get a car, she says national weather seems even more important to follow.

Car dealers do not expect hurricanes Harvey or Irma to disturb the supply and consumer price of new cars.  Car manufacturers can redistribute their products.  

Auto industry experts are warning about some of these cars that have been destroyed by hurricanes, being fixed only a bit, then appearing on an independent dealership's lot.  Watch the associated video showing some things to look out for while looking over a used car.

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