Are SUVs Worth More Now that Gas is Down?

Over the summer when gas prices were at an all time high, SUV owners that wanted to trade in their gas guzzling vehicles were stuck. Many car dealerships refused to take trucks and SUV's in on trade and without this option, many SUV owners were not able to trade into smaller, more fuel efficient vehicles. At the time, everyone was wondering if SUV's would be worth more when gas went down.

Dealerships were faced with a dilemma that had never been seen before. The SUV market was very volatile, the NADA books that dealers rely on to value used cars could not be updated as quickly as the market was fluctuating. The dealers could not resell the used SUV's and therefore, they could not take them in on trade. For example, a new car dealer typically takes used cars that are taken in on trade to dealer only auctions, while gas prices were high, no one, not even used car dealers were buying SUV's. The bottom had literally dropped out of the SUV market as everyone was scrambling to purchase smaller, more fuel efficient vehicles. For the first time in many years, small fuel efficient vehicles were surpassing the demand for more family friendly SUV's. Many car dealers were left with a large number of SUV's sitting idle on their lots, they were hoping that SUV's would be worth more when gas went down.

Now that gas prices have fallen, SUV owners are returning to the new car lots wondering if SUV's are worth more now that gas is down. The good news is that it appears most consumers have a pretty short attention span because the value of SUV's have indeed increased and appears to be returning to pre gas crisis prices. Unfortunately for struggling car manufacturers, as gas prices continue to fall, it seems that more and more SUV owners are content to keep their super sized vehicles instead of trading down to smaller, more fuel efficient vehicles.

With car manufacturers and dealers having a dismal business outlook, many wonder if the gas crisis was good for the automobile industry. When gas prices went up, customers were eager to trade their vehicles. Now that fuel prices have stabilized and fallen, consumers seem to be holding onto their vehicles longer due to the uncertainty in the economy. While the SUV may be worth more when gas went down, it does not seem to have been enough of an incentive to lure consumers back into the showroom.