Higher prices have been hitting consumers hard, including in the automobile market. Like many other goods, cars have been hit by global supply chain issues, especially lacking in microchips.
While used car prices are starting to come down, prices for new vehicles are up to about eight percent over the last year. The Biden Administration is trying to solve the issue with the passage of the CHIPS Act and the Inflation Reduction Act, but both laws will likely take some time before having a larger effect on the economy.
“Automakers are making record profits, aside from a few head winds here and there.” — Jamie Butters, Automotive News
Listen: Why new car prices are up so much.
Jamie Butters is the executive editor of Automotive News and co-host of the Automotive News Daily Drive podcast. He says automakers and dealers are benefiting from a lack of supply, pushing up prices.
“Right now, with the scarcity, automakers don’t have to put big incentives on vehicles,” says Butters. “Everything is selling for sticker price or even a little above. So, dealers are making, basically record profits. Automakers are making record profits, aside from a few head winds here and there,” says Butters.