With a national computer chip shortage impacting the supply of new vehicles in the United States, demand for used vehicles has been rising this year, causing their prices to reach record highs, according to a report by market research company J.D. Power.
The firm found that the average price of a preowned vehicle hit a record high of $25,463 in April, roughly $2,800 higher than April 2020.
A global shortage in computer chips, which are used in everything from gaming consoles to appliances and the semiconductors that help cars operate, is believed to be the cause of an ongoing shortage in new vehicles.
The car market also holds a direct tie to the chip shortage, according to NewScientist, which reported that as people were traveling less during the pandemic, demand for vehicles initially fell, causing chip producers to dial back manufacturing efforts. Booming demand for the many other types of consumer products that utilize computer chips, however, created an enormous disparity in supply and demand that is expected to continue well into 2021.
The Wall Street Journal reported this month that the national supply of used vehicles is also tight entering into this year because people were keeping leased vehicles for longer periods of time, pushing prices ever upward.