Welcome to today’s live chat! Joining us today is Kiplinger’s auto columnist Jessica Anderson and Senior Editor Mark Solheim. They’ll be taking your questions about shopping for a used car for the next hour. Thanks for joining us Jessica and Mark!
Hi, I’m Jessica Anderson. So glad you guys could join us today!
We have several questions in the queue, but to get us started, Jessica and Mark, can you tell us a little bit about the current used car market? Why are used car prices so high right now?
It sounds funny, but used car prices are so high because new car sales were so bad three to four years ago...
What happened was: For a long time cars were selling at 15 or 16 million a year and then in 2008 and 2009 sales fell off a cliff with the financial crisis.
So...fewer sales and leases then means fewer used models of those years re-entering the market now. Low supply translates into high prices. It’s all economics.
Plus, more people looked for cheaper used cars during the recession.
So there was more demand, and supply was limited.
That makes sense. Do you think prices will go down anytime soon?
Sales started recovering in 2010 and were even better last year...
so we're trending in the right direction.
Experts say so three-year-old vehicles will start coming back into the market next year and put some downward pressure on prices.
As gas prices have increased, there has been a premium in particular on compacts and subcompacts.
Fuel efficiency is at a premium. That is directly correlated with the price of gas.
Jessica's June article included some research showing that sometimes it pays to buy a new car rather than used, when it is a fuel-efficient car.
That sounds crazy, but it shows how much in demand used cars are.
We'll come back to fuel-efficient used cars later on in the chat, but let's go ahead and get started with our first question.
Certified used can give you a lot of peace of mind.
But they do cost more--$500 to $1,500 is a good range.
It gives you the assurance of factory inspection plus an extra warranty.
The alternative is to get a thorough inspection by a mechanic of any car you buy.
Hey dawgg, what kind of car are you looking for?
Because if your used car has a really reliable record, you may be able to get by not buying certified.
Dawgg submitted his question early, so he may be checking back later for your advice. Let's wait and see.
In the mean time, we'll move on to the next question from Pete.
Hey Pete--if you've looked at the prices of the used 2011 and it's not too different from 2012, go for the new model.
You'll benefit from a longer period in-warranty and the new LaCrosse models have eAssist available, which helps save fuel by shutting down the engine when you're stopped.
Often when it's a late model used versus new, the warranty makes the new model worth the extra money.
You like the LaCrosse, don't you Jessica?
I do--I think it's a really strong competitor to Lexus ES. Better actually.
And I assume it costs less than the ES.
Pretty sure, but I'd have to check on that Mark.
Yup--it starts about $6,000 less
Our readers should know that we have full listings of the 2012 models on Kiplinger.com
Jessica and Mark, can you tell our audience a little bit about how we chose those cars?
So whether you're shopping new or used, we've got you covered.
Ha, yes I did. We start with our new car rankings from several years ago
and look at 3-4 year old vehicles
So the years we were looking at for this year's used car roundup were 2008 and 2009. Especially since prices are high, we didn't want to go too much newer.
We picked ten vehicles -- five sedans, three crossovers, a wagon and a minivan -- that received top scores in Kiplinger's rankings for performance, value and safety, plus got high marks for reliability.
We didn't pick super-fuel-efficient models, such as the Toyota Prius, because prices have soared to stratospheric levels.