New analysis from IHS Markit points to record-breaking vehicle ages on the road today. Over the past few years, vehicle age has been slowly trending upwards and is now at an all-time high of 11.9 years. In fact, 1 in 4 cars and trucks you see are at least 16 years old. But why? Here to discuss what the data says about this trend is Todd Campau, after-market specialist with IHS Markit.
“We sit at 11.9 [years] as of January 1st, 2020 and realistically it’s likely going to only go up,” says Todd. “With the effect of the pandemic, we’re seeing lower new vehicle sales, so people are going to hold on to their vehicles longer until they figure out what their new normal is going to look like.”
Todd believes vehicle quality has a lot with this upward trend. Consumers feel more comfortable keeping their vehicles for a longer span of time. The cost of new vehicles has increased as well, as has the length of loan terms. This means that the first owner of the vehicle will likely keep it longer than ever before, thus impacting the second or even third owner. This is great news for after-market sales, but it might affect new vehicle inventories differently moving forward.
The Average Vehicle Age on the Road Today Keeps Climbing – Why?