A reduced supply of used vehicles as fewer vehicles come off leases has helped raise the price of used cars and trucks, according to a study by Scotia Economics. The Scotiabank division said last week its used car price index was 0.3-per-cent higher than a year ago.
"Retail leasing of new cars and light trucks peaked in North America in the late 1990s, but has dwindled in recent years, especially since the introduction of zero per cent financing on new vehicles in late 2001," said Carlos Gomes, Scotiabank's auto industry specialist.
"As a result, Scotia Economics estimates that the number of vehicles coming off-lease in Canada will likely drop below 500,000 units this year from a peak of more than 550,000 in 2002."
The pickup in used car prices is a very positive development for the auto industry, Scotiabank suggested, as rising "pre-owned" car prices are a leading indicator of new vehicle sales.
