Post #619 by mungofitch on the US Policy board

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If new car prices rise; it would be logical to assume that will result in less buyers for new cars, thus limiting the number of resell cars that hit the market.

For sure. But only after a few years of lag.

It's a very odd business, in that sense. All kinds of factors affect the flow like how big the new car market was a few years earlier, finance affordability then, finance affordability now, leasing and fleet market shares, what new car prices are doing, how many car owners are in distress to the point of seeing repo, how the economy is doing (good vs early recession vs late recession)...

I find that the market frequently tends to focus too much on the factors affecting the *price* of cars, and not enough on the factors affecting the turnover rate.

Jim

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