From Teslas to Minis, many are looking to unload their cars before they leave Asian business center.
While the average price of used cars have risen in the first quarter of 2022, there was one place in the world that it has significantly dipped: Hong Kong.
According to a report by Bloomberg, the average reference price for a used car in Hong Kong fell by six percent as compared to the same period in 2021. This number excluded cars that are over one million Hong Kong dollars.
Bloomberg analyzed data from the biggest used vehicle center at the territory, the online platform Hong Kong Motor City. They found that prices peaked in the third quarter of last year and steadily dropped up until the start of 2022.
The main driver for this trend it seems is what has been a global constant in the past two years: COVID.
As the Omicron variant led to a surge of cases in Asia, Hong Kong added lockdown measures have caused many to leave the city. “Restrictions put in place after Covid-19 suddenly took hold in the city, as well as Beijing’s increasing influence, have led many to decide their time in the Asian financial center is over,” Bloomberg writes, adding that there have been at least 160,000 departures in the first few months of the year.
With this many people exiting, many vehicles are either being sold at substantial losses—from Audis to BMWs to Minis—or simply being abandoned there. In a story, The Street says that prices for Tesla’s Model X have even dropped around 15 percent.
It is not the same scenario for the rest of the world where car prices have gone up because of a combination of delays, supply shortages, and high demand. According to ZeroSum, the “average used car price rose to $33,464 in February, which is about 1% higher than January and 38.5 percent higher than a year ago.”
Banner Photo: Photo by Alexandr Bormotin on Unsplash
