(WXYZ) — Many people looking for a new set of wheels are becoming increasingly frustrated. Since the beginning of the year, the car market has been hit hard with problems ranging from chip shortages, low inventory, and high prices.
According to experts, the situation may be even worse now.
Car buyers like Tawana Langford of Southfield want relief. She said she's been shopping for a new car because her current sedan needs a lot of work.
"When you look at the prices right now for a new car, what goes through your mind?,” I asked.
"Can I afford this?" she answered with a laugh, "But it’s something that I need."
Ala Shuker of Bloomfield Hills is calling the current market “unfair.” He told me he's been looking for a car for about 6 months.
"There's no cars. I've been shopping or even looking out of state, and there's no cars available. And if there are cars available, they're asking for $10,000 to $15,000 over," Shuker said.
This sticker shock extends to leases, too, with one salesperson telling 7 Action News that lease prices are now between 20% to 40% higher than pre-pandemic levels.
And the hike in interest rates is making financing more expensive.
Edmunds.com reported at the beginning of October that the average monthly payment for new cars is now more than $700. They also add that a little more than 14% of buyers are paying over $1000 a month -– the highest number on record.
Randy Wagner the General Sales Manager at Art Moran GMC Buick in Southfield says the supply chain and chip shortage issues are still here, but they have been easing and inventory is up.
"Good news is our inventory here at Art Moran [has] tripled," said Wagner.
“We still have that pent-up demand that is spurring our business, and hopefully that continues,” Wagner added.
This is good news for dealers. But what about buyers?
"Interest rates are going through the roof, and that's pushing a lot of people out of the market right now,” said John McElroy — host of autoline.tv.
He said that even used car prices are sky-high.
“I don't think prices are going to start to drop any time soon,” McElroy said.
McElroy said automakers like Stellantis are trying to give people affordability options with older and older cars.
“They used to have a max of five-year-old vehicles with a max of 75,000 miles on the odometer. Now they're going to ten-year-old vehicles with 125,000 miles on the odometer," he explained.
Tawana Langford is in a hurry to buy a new car, but Ala Shuker is pumping the brakes on the process.
"To me, I'd rather drive this car until the market kind of balances itself out, and there's cars available," Shuker said.
John Mcelroy said right now, there isn't necessarily a clear best option when you're weighing whether to buy a new, pre-owned, or leased vehicle. He suggested you do the math to see what works for you and your budget.
You can find zero-percent financing at some dealerships. But when you calculate it out, it may come out to a payment, in some cases, of about $1000 a month. And most people can’t afford that.
So, if you can wait to get a car, wait. Otherwise, expect to pay up.
