Second-hand cars are in huge demand nowadays.
Due to concerns over having to sit or stand close to other people when using public transit, commuters in Canada are choosing to drive instead.
A new report by TD Economics notes that sales of used cars are rising because of health anxieties over the ongoing COVID-19 pandemic.
The report noted that the resale of vehicles “may be benefitting from demand related to potential concerns about being in close proximity to others on public transit”.
Moreover, this “shift towards personal transportation has been observed in other countries in response to the pandemic”.
The increased demand for used cars is part of a more comprehensive account on expenditures by Canadian consumers.
The report titled The Right Direction, Slowly: An Update on Canadian Spending Patterns was written by Brian DePratto, director and senior economist with TD Economics.
In Metro Vancouver, the region’s public transit authority has forecast that its ridership may remain below pre-COVID 19 levels because of health concerns and cheap gas.
“Transit ridership will likely remain well below pre-COVID levels until some time after the pandemic and its recovery will be heavily dependent on the degree to which people still feel some lasting proximity anxiety; rates of unemployment; and the degree to which the roughly half of workers in our region that are able to work from home, continue to do so,” Geoff Cross, vice president for transportation planning and policy with TransLink, wrote in a report.
Cross’ report was included in the meeting agenda of the TransLink board on June 18.
“There is a risk that previous regular transit users will start making more of their trips instead by automobile for understandable reasons, and that these habits will stick post-pandemic,” Cross noted.
Cross wrote that a “key near-term transportation objective during this pandemic period should be to minimize resident’s needs for new single-occupant auto trips”.
“The low fuel prices in the region exacerbate this challenge,” Cross pointed out.
Going back to the TD Economics report released Monday (June 22), there’s another class of vehicles that is seeing more demand: recreational vehicles.
“With international travel seemingly out of the question this summer, some Canadians have looked for escapes closer to home, supporting sales of recreational vehicles,” according to the report.
Including car parts, spending on used cars and recreational vehicles rose nearly 20 percent year-on-year by June 12, based on a graph included in the report.
The TD Economics report noted that overall, the “re-acceleration of Canadian spending continued over the first half of June”.
However, the “pace of improvement has moderated”, with personal spending down about four percent year-on-year in the week ending June 12.
“Improvement can be seen across most spending categories, but higher-touch areas such as clothing and professional services remain challenged, and travel spending remains significantly below normal,” according to the report.