How Old Are Most Cars on the Road?
The “new car smell” might be pervasive at dealerships, but it’s becoming less of an olfactory experience in the driveways and garages of the average car owner. The COVID-19 pandemic, among other factors, has continued to drive up the age of the average car on the road, according to a recent study.
The average car on the road is older than in years past
The iSeeCars study gathered data from 21 million used cars sold between 2019-23—excluding heavy duty and “low-production” models—and underscores that increased prices for used models and limited availability of “newer” used cars has resulted in a dramatic shift in the average age of cars currently on the road.
In 2019, the study notes, the average age of used cars sold was 4.8 years old. Now in 2023, that figure has risen to 6.1 years old.
In 2019, over one-quarter of used cars sold were either one or two years old, the study notes, but just four years later, that percentage has dropped to just under 19%. Meanwhile, cars aged five to 11-plus years old has dramatically increased.
For instance, the number of seven-year-old used cars sold in 2023 was 36% higher in 2023 than in 2019. The percentages are even higher for models older than seven years. Models between eight and 10 years old sold in 2019 accounted for 8.9% of used car sales in 2019 but have increased dramatically to 15.9%.
Across the board, used cars sold in 2023 are far older than those sold in 2019.
What is causing older cars to sell at higher rates?
The reason behind the increase in more older used cars being sold all comes down to dollars and cents—pricing for used cars has increased dramatically over the past four years. Effectively, your dollar simply doesn’t go as far in 2023 as it did just a few years ago.
The study found the average price of a three-year-old Nissan Versa in 2019 was just over $10,000. Today, the average price for a eight-year-old Nissan Versa is a bit over $10,100. As such, 10-grand could net buyers a 2016 Versa in 2019, but now, that same amount of money is still needed for the same proverbial model, though now it would be eight years old versus just three.
It’s a similar story for plenty of other popular and “affordable” models. In 2019, the average used car price for a three-year-old Mazda Mazda3, Toyota Corolla, Honda Civic, Toyota Camry, Hyundai Accent, or Ford Mustang is now the same price buyers must pay for an eight-year-old model.
The price across all used car sales is up an average of 33%, from $20,398 to $27,133, the study found.
One of the main contributing factors to higher prices, the study notes, is limited availability of car models from 2020-22 due to the COVID-19 pandemic that severely hampered production. There simply weren’t as many models produced during this period, leading to lower inventories and subsequently higher prices across models from these years and beyond.
There could be some other factors at play, including that buyers are more willing to purchase older models given overall reliability among models is generally rising with each year that passes. To boot, the average new car price is simply rising, which will naturally result in older models retaining higher pricing even in the used market.
Regardless of the factors at play, it’s clear that the same money has far less buying power in 2023 as it did just a few years ago.