Car market's wild ride

Secondhand prices went crazy during the pandemic, but the market shows signs of cooling

- TOBY HAGON

When Richard Walsh took delivery of a Toyota RAV4 hybrid early last year, he had visions of it being part of his garage for years to come. The car was to be predominantly driven by his wife, and the sensible size and fuel-sipping petrol-electric drivetrain made plenty of sense to the Sydney butcher.

Within months, Toyota announced an updated model with new features, including a larger 10.5in infotainment screen and 12.3in digital instrument cluster. “I’d been planning to hold onto the car for years, but I found the smaller screen a disadvantage … I wanted the new tech,” says Walsh.

Even though there had been price rises with the updated model, Walsh investigated the cost of trading up.

Solid demand for used hybrids meant he was able to sell the then nine-month-old car for a fraction more than what he paid for it.

He ordered a new one of the same model and colour. And while it’s been delayed, he is lucky to have other modes of transport. “I’ve got a few older cars in the garage, so my wife is driving one of those until the new RAV4 arrives.”

As it turns out, he timed the sale almost perfectly.

Unprecedented surge

Used car values have been at record highs since Covid changed the world, with many buyers selling near-new vehicles above the price of a new one.

But market volatility is subsiding and prices are finally coming off their highs.

When the pandemic hit in 2020, it caused mayhem with both supply and demand.

Some car makers slashed production while others were forced to temporarily shut plants. And booming global demand for semiconductors – of which there can be hundreds in a modern car – led to a worldwide shortage that impacted most brands.