Used Car Prices Hit All-Time High, 3 Beneficiaries Expected

Used car market in Janghanpyeong, Dongdaemun-gu, Seoul. [Image source=Yonhap News]

[Asia Economy Reporter Changhwan Lee] Interest is growing in industries benefiting from the record-high used car prices in the United States. Analysts in the industry suggest that rental car companies and tire manufacturers are expected to see positive effects.

According to Samsung Securities on the 22nd, the U.S. used car index for April reached 166.3 dollars, marking the highest level since 1953. As the used car index rose, the U.S. Consumer Price Index (CPI) for April also surged.

The rise in used car prices is due to a sharp increase in demand for outdoor activities, travel, and business trips following the expansion of vaccine distribution in the U.S. New car demand has also increased, but due to a shortage of vehicle semiconductors, new car supply has been constrained, causing used car prices to soar significantly.

The increase in used car prices is expected to help improve profits in certain industries.

In particular, the rental car industry is expected to benefit greatly. Since most rental cars are used vehicles, both demand and asset value are rising. With expectations of improved performance, Hertz Rental Car in the U.S., which filed for bankruptcy protection in May last year, saw its stock price surge by 440% this year. In Korea, SK Rent-a-Car and Redcap Tour stocks have also risen significantly.

The tire industry is also a beneficiary. Demand for replacement (RE) tires used on used cars is rapidly recovering. Starting in the U.S., demand for used car tires is quickly spreading to Europe, China, and Asia, leading to expectations that the global tire industry will benefit.

Additionally, Hyundai Motor's financial sector is also expecting strong performance. In particular, the U.S. financial corporation's results are rapidly improving thanks to the increase in used car values. Its subsidiary Hyundai Capital is also ranked third in the rental car market in Korea, raising expectations for improved performance.

Samsung Securities researcher Eunyeong Lim stated, "Due to the shortage of vehicle semiconductors, demand and prices for used cars are expected to remain strong in the mid to long term."

This content was produced with the assistance of AI translation services.