NADA Used Car Guide: Will Cost of Small Cars Go Up Another 30 Percent?

Pushed by supply dynamics and surging fuel costs, small-car trade-in values are likely to skyrocket next month, according to NADA Used Car Guide.

Specifically, NADA Used Car Guide senior analyst Jonathan Banks is predicting a 30-percent year-over-year hike in trade-in values for used small cars in June.

“Strong consumer demand for small used cars is driving up prices,” Banks explained. “The NADA Guide increase in trade-in values for June should come as no surprise because it reflects a shortage of both new and used cars entering the market.”

For the first half of the year, overall, small-car trade-in values are projected to be 18 percent above the pace through June 2010, officials revealed.

“Fewer new cars have been produced as a result of the crisis in Japan, which has shifted consumer demand to the used car market,” Banks added. “High gasoline prices are also increasing the demand for both new and used small cars.”

Moving along, NADA Used Car Guide also gave some examples of various small cars expected to show some June gains:

“The June edition of the NADA Used Car Guide will reflect price increases to help dealers and consumers determine accurate trade-in appraisals and assist lenders with loan underwriting during this unique time in the auto industry,” Banks added.