Lower Small Car Prices Impact Car Donation Industry

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Across the country, automotive experts are watching the price of some used vehicles drop. Smaller cars – subcompacts and entry-level sports cars – are seeing a 2.5% reduction in price on top of previous low prices.1 In the past, consumers have been reluctant to donate a car or truck to charities like The American Cancer Society or Habitat for Humanity, instead holding onto their vehicle. Analysts have pointed to various reasons for the trend, from economic instability to higher build quality of today’s vehicles.

The recent surge in leases for small and midsize cars has spurred an avalanche of post-lease vehicles returning to the used car market, and with larger supply comes lower prices,” says Edmunds.com Director of Industry Analysis Jessica Caldwell.2

Donation Programs

This trend is expected to impact the low-end vehicle market and car donation programs, as consumers consider donating or scrapping a vehicle they were – until recently – driving daily. Car Talk, March of Dimes, and other charities that accept vehicle donations are hoping to see more consumers trade up to a newer, safer vehicle. Owners will then have a choice: trade in their old car, have it hauled away to earn some fast cash, or donate the car to a charitable organization. The latter can benefit children in need, critical medical research, or families in search of affordable housing. The metal recycling industry could see a substantial surge as well, as donated vehicles are often scrapped for parts or steel.

About ARS
Advanced Remarketing Services offers innovative solutions to some of the remarketing industry’s toughest questions. We navigate the confusing landscape of wholesale, salvage and consumer markets to sell the vehicles in the best venue to the most appropriate buyer base.

Ethan Frederick GrantLower Small Car Prices Impact Car Donation Industry

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