Demand has been rising for secondhand cars in a market trying to fend off the tight supply of new vehicles.
Besides the availability problems, what drives the demand is people’s expectations that prices will go up in the coming months due to the perceived depreciation of the local currency.
Demand for secondhand cars has increased by 25 percent in the past two months, according to people from the industry. That pushes up the prices of those cars.
In the January-March period, nearly 1.9 million vehicles changed hands in Turkiye, the data from the Turkish Statistical Institute (TÜİK) showed.
Secondhand car prices have gone up by 40 percent on average, according to Cardata, which compiles data on the auto market.
From January to April, 350,000 new cars were sold in the country, pointing to a 57.3 percent increase from a year ago. The annual increase in passenger car sales was 55.7 percent to nearly 253,000, according to the Automotive Manufacturers’ Association (OSD).
Between January-May, the prices of new cars rose on average by 15 percent.
“There has been panic buying and selling in the market because people predict that prices will go up starting from mid-May,” said Cihan Emre, a general coordinator at Pilot Garage.
Those people who own a car sell their vehicles to buy a new one, while those who do not own a car and expect prices to go up want to buy one right now, Emre added. “Most people consider cars as an investment.”
Only in the past month, prices of new cars have increased by 3 percent on average, while the rise in the cost of secondhand cars over the same period is 8 percent, Emre said.
“Demand for secondhand cars soared 80 percent in January-May compared to the same period of last year. Consumers who cannot find a new car have shifted to buying secondhand vehicles, fearing that prices will further go up,” he explained.
The expectations that prices will increase due to the depreciation of the local currency is also driving the demand for new cars,Emre said.
The OSD reported last week that passenger car sales leaped nearly 70 percent in April from a year ago to more than 77,000, with total vehicle sales rising 63 percent to 102,000.
Local companies manufactured around 74,000 passenger cars, up 17.2 percent from April 2022.