SEATTLE — Low supply and high demand are causing an unprecedented spike in used car prices as the ongoing threat of COVID-19 continues to have an impact on small businesses.
“We've been in business for over four years, and it is a family-owned business,” said Marianna Baghdasaryan, who helps run J & A Auto Sales in Bellevue. “We try to provide a wide variety of cars from your more luxurious Mercedes and Porsches to just regular Toyota Camrys.”
J & A Auto Sales opened their business right as the pandemic began.
“We had to close down for two to three months. It was difficult and then everything seemed like things were changing by the week," said Baghdasaryan.
Aside from learning how to navigate public health mandates, Baghdasaryan said obtaining cars to sell from their lot became increasingly difficult.
“The prices for small dealerships to obtain cars are higher than ever before, and I think they probably increase on a weekly basis,” explained Baghdasaryan. “That’s because the supply and demand issue is so huge right now and there are not that many used cars out there anymore because the supply of new cars has kind of held due to the pandemic.”
KING 5 News also spoke with Joe Reynolds, owner of Go Auto Brokers. In addition to running his own business, Reynolds studies the ever-changing automotive industry.
Joe Reynolds, owner of Go Auto Brokers studies the ever-changing automotive industry and said getting a car to sell used to be easy.
“I could just go to a wholesale auction and it would be there and I could get it for a reasonable price if I just spend a little bit of effort," said Reynolds.
Nearly two years into the pandemic, Reynolds said that is no longer the case.
“Now, the game has really changed and the new dealers, like some of the online giant dealers, are just willing to pay crazy money,” said Reynolds.
Online dealers like Vroom and Carvana are also buying cars, limiting the options for dealers like Go Auto Sales and J & A Auto Sales.
As far as how long this supply and demand problem will last, the answer is unclear.
“I thought we would have been back to normal by now. All the data that I hear and hear experts talking, they say it could be another year or longer but I really don't know," said Reynolds.
“I think in this market, everybody is just trying to scramble to find the right inventory to even keep whatever they have afloat,” Baghdasaryan said. “It’s the positive outlook on things that dictates how well a person will come through, you know, out of this pandemic. We're not going anywhere."