With new cars in short supply because of the ongoing chip shortage and supply disruptions, demand for used cars has skyrocketed, taking prices right along with it.
The average price of a used car was $28,384 in September, up nearly $8,000 since February 2020, according to Edmonds.
“We're not actually seeing anything that would suggest that [used car] prices are going to stop peaking for now,” Shift Technologies (SFT) co-founder and co-CEO George Arison told Yahoo Finance Live.
The online used car marketplace recently raised its guidance for the year after revenue jumped 200% year-over-year in the third quarter. Arison said demand was driven by sales of electric vehicles and hybrids.
“Usually in the fall, prices tend to come down a little bit and demand tends to slow down as well... this year we didn't see that at all. Actually in September, prices went up pretty significantly,” Arison said.
Over 90% of the cars Shift sold in the Q3 came from other consumers, something Arison said “makes it easier for us to acquire inventory.”
Prior to the pandemic, autos were less than 1% of e-commerce sales, but that number is growing.
“What we've seen in the last two years is an explosion in demand for e-commerce across all sectors, including cars," said Arison. "It’s a huge opportunity for auto to really catch up and there's still a lot of room to grow… but I think people are much more cognizant of the fact that they now can buy online and not have to go into a store to purchase the vehicle."
Alexis Christoforous is an anchor at Yahoo Finance. Follow her on Twitter @AlexisTVNews.