Parents of high school students who are getting their permits might want to hold off on purchasing a used car at this time.

If you recently got your permit or your parents have been trying to buy a car, you may have noticed that dealerships have raised prices significantly in the past two years, as dealerships raise prices and add hefty dealership fees because of limited demand.

Ever since the unprecedented COVID-19 pandemic hit, the world has been suffering through labor shortages, supply chain issues, and production halts to name a few problems.

Car manufacturers claim that this is because of the chip shortages that they have been struggling to keep inventories stocked, leaving dealerships to charge consumers however much they want because there is very little consumers can do about the price hikes.

Senior Andres Estrada recently purchased a truck to use for his landscaping business outside of school.

“I feel like I overpaid with the current market right now,” he said. “It is really overpriced and I’m honestly kind of disappointed, but I also can’t hold off on my purchase because I need it for work.”

How long will this last?

It’s hard to tell when the storm of labor and production shortages will clear out, but some big auto manufacturers such as, Ford, have taken notice and issued warnings to car dealerships that have taken part in price hiking.  Economists have estimated that it could take around 1-2 years before the automobile industry can catch up to the demand and bring surging prices back down.  If you don’t necessarily need to buy a vehicle, it would probably be best to wait off the supply shortage of vehicles.

Is buying new the move?

In some instances, yes it is!

A little online research can show that the MSRP for a new 2022 Honda Accord should be around $26,000 but when looking at the same model just a different year multiple 2020 models can be found with over 10,000 miles on it selling for around $2,000-$4,000 dollars more than what the new model costs and that’s still before any dealership fees or taxes.

It’s crazy to see dealerships charge more for used cars than for newer cars, so it is important to look around multiple car dealerships if you’re looking to buy a car.