Wednesday, August 25, 2010

What happens when you destroy 5 million used cars?

This was the supply decrease caused by "cash for clunkers."  Predictably, the supply decrease has pushed prices of used cars higher. 
The used car models jumping the most in price include mid-size SUVs and mini-vans designed to carry around families.

Used Cadillac Escalades are almost 36% more.

Chevy Suburbans jumped 34% in price.

Dodge Grand Caravans are also seeing a 34% increase.

BMW X5 is 33% higher.

An Acura MDX will run you 29% more.


  1. Cash for clunkers as an adverse supply shock in the used car market...
    Hrm, I wonder how many government programs meant to stimulate demand actually function to reduce supply?

  2. The increasing prices of used cars will stop selling used cars in the market.