What Rising Car Prices Mean for Our Economic Future

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Car dealership in Carlsbad, Calif., in 2016. (Mike Blake/Reuters)

Economists and industry experts tell NR that the price surge is a reflection of short-term shocks, not longterm inflation.


s the pandemic reared its ugly head, many Americans prepared to hunker down for the foreseeable future. They headed to grocery stores, pharmacies, and Amazon.com to grab the goods they thought they’d need to weather the uncertain months ahead. Cars were among those goods: As COVID fears peaked, consumers ditched ride-sharing and more bio-hazardous transportation options for personal passenger vehicles.

As with raw materials and durable items, car prices skyrocketed over the past year. The surge, while mostly attributed to short-term shocks, coincided with Congress’s massive relief-package deployments and the Federal Reserve’s record monetary injections. The uptick in car price indices …

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