The quality of cars has been increasing every year. Now, the average age of a car in the US has hit a new record with up to 12.2 years.
Many countries now have restrictions by governments to stop the usage of old cars. However, the quality of cars has also increased over the last few years. More and more people seem to be sticking with their old cars for longer periods. According to a new report by S&P Mobility, the average age of a car on U.S. roads is now a little over 12 years. While there has been a continuous increase for the last five years, this is a new record. Let’s take a quick look!
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Multiple factors have contributed to this increase in the average age of cars. This includes the slump in production due to the ongoing pandemic and semi-conductor shortage. As customers had to wait longer to upgrade their vehicles, many chose to continue with their vehicles or purchased used ones. This has also made the used-cars 40.5% more expensive than last year. The increase in the average age of light vehicles in operation (VIO) in the US is expected to sustain through 2022 and 2023.
Additionally, the economic situation in the US has also led to the increased usage of old cars. This includes increased gas prices, inflation, and more. The Federal Reserve has also raised borrowing rates across the economy. The total number of cars taken off the road in 2021 was 11 million (down from 15 million in 2020). The scrappage rate is also down to 4.2% (compared with 5.6% the previous year). This is the lowest that number in two decades.
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On the other hand, the average age of EVs has gone down. At 3.8 years, it is slightly down from the year before. The S&P report claims that the number of electric vehicles on the road was up nearly 40% in 2021. The light trucks (which include SUVs) represent 50% of new registrations and a growth of 141%. Overall, the driving habits of the country have returned to pre-pandemic levels. While there may be an increase in repair costs, there are lesser new cars on the roads.