How to Navigate Car Shopping in July 2022

The automotive landscape in July 2022 presents unique challenges for car buyers. With vehicle prices soaring, persistent demand, and dwindling inventories, navigating this market requires informed strategies. This guide offers insights into the current trends and provides actionable tips to help you make the best purchasing decisions.

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1. Significant Decline in Vehicle Inventory

As of mid-2022, new car listings have plummeted by over 70% compared to the 2019 average. This drastic reduction is attributed to ongoing supply chain disruptions and production challenges. Despite these hurdles, consumer demand remains robust, leading to a highly competitive market where vehicles sell rapidly upon arrival at dealerships.

2. Decrease in Sales Amidst Unwavering Demand

While the appetite for vehicles hasn't waned, sales figures tell a different story. New car sales experienced a 3% drop from May to June 2022, primarily due to the limited inventory. The used car market faced a more pronounced decline, with sales down 13% from May 2022 and a 16% decrease compared to June 2021. This trend underscores the pressing issue of supply not meeting the sustained demand.

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3. Escalating Fuel Prices Boosting EV Interest

The surge in fuel prices to historic highs has prompted consumers to reconsider their vehicle choices. There's a noticeable shift towards electric vehicles (EVs), with interest in new EVs more than doubling since June 2021. This growing inclination towards EVs is a direct response to fuel cost concerns and a heightened environmental consciousness among buyers.

4. Rising Interest Rates Affecting Financing

Financing a vehicle has become more expensive in 2022. The average interest rate for new vehicles rose to 5.2% in June, up from 5.1% in May. Used vehicle loans are even higher, averaging 8%. For consumers re-entering the market after a few years, these rates are notably higher than those seen in 2018 or 2019, impacting overall affordability.

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5. Extended Loan Terms Becoming Commonplace

To counterbalance the effects of rising interest rates and vehicle prices, many buyers are opting for longer loan terms. In June 2022, the average loan duration for both new and used vehicles reached 71 months. Notably, there's been a 30% increase in loans extending to 84 months or more compared to the previous year. While this approach lowers monthly payments, it's essential to consider the long-term financial implications of prolonged loan periods.

Strategic Tips for Car Buyers in the Current Market

Given the current market dynamics, prospective car buyers should adopt strategic approaches to navigate the challenges effectively:

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1. Thorough Research and Preparation

• Set a Realistic Budget: Determine what you can afford, factoring in potential increases in interest rates and extended loan terms.
• Explore Multiple Financing Options: With rising interest rates, it's prudent to shop around for the best loan terms, including considering credit unions and online lenders.
• Stay Informed About Market Trends: Regularly check resources like MotorVero for updates on vehicle availability and pricing.
• 

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2. Flexibility in Vehicle Selection

• Consider Alternative Models: High demand may limit availability for popular models. Being open to different brands or models can increase your chances of finding a suitable vehicle.
• Evaluate Certified Pre-Owned Vehicles: With new car inventories low, certified pre-owned cars offer a reliable alternative, often coming with warranties and thorough inspections.

3. Timing and Negotiation

• Monitor Incentives and Deals: Manufacturers may offer promotions to stimulate sales. Keep an eye out for such deals, especially during holiday periods.
• Be Prepared to Act Quickly: Given the fast turnover of inventory, once you've identified a vehicle that meets your criteria, be ready to make a prompt decision.
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Leveraging MotorVero for a Seamless Car Buying Experience

Navigating the current automotive market can be daunting, but MotorVero is here to assist. Offering a comprehensive platform, MotorVero provides:

• Extensive Vehicle Listings: Access a wide range of new and certified pre-owned vehicles tailored to your preferences.
• Financing Tools: Utilize calculators and get pre-qualified to understand your purchasing power and potential loan terms.
• Expert Reviews and Resources: Stay informed with up-to-date reviews, buying guides, and market analyses to make educated decisions.

By leveraging these resources, you can navigate the complexities of the July 2022 car market with confidence and ease.

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Conclusion

The automotive market in July 2022 presents a unique set of challenges, from reduced inventories to rising costs. However, with thorough research, flexibility, and the right tools, you can make informed decisions that align with your needs and financial situation. Remember, platforms like MotorVero are designed to support you every step of the way, ensuring a seamless and informed car-buying journey.

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