There is one place in the world where a car, after three and a half years of driving for several miles, is worth practically the same as the day it left the dealer: Argentina. This almost doesn’t happen anywhere. Generally, a 0km run loses between 20% and 30% of its value the first time you go around the block. But we have once again invented the square of the circle: inflation and protectionism meant that, for example, a new Chevrolet Onix LS that cost 984,900 pesos in March 2020, before the quarantine, is now worth 6,543,000 dollars. It’s the same car, but 564.3% more expensive in pesos and three and a half years old. Almost on par with inflation, which has since stood at 569 percent.
The data belongs to the official list of Automotive Chamber of Commerce. In these three and a half years The owner of Onix only lost against the blue dollar, which seemed unbeatable in Argentina: At the price at the time of purchase ($78.5 per dollar on March 2, 2020), these 0 km were worth $12,546 and today, even with the kilometers traveled, they are worth $8,902. 29% less.
As if they wanted to ignore what the Minister of Economic Affairs said Sergio Massa asked last week: “Buy a car, don’t buy dollars.”. In any case, if the blue does not spike, it is likely that the dollar value will equalize again in ten days, as traders are already planning to raise all prices by 35% due to the devaluation. The three and a half year old Onyx then costs $8,833,000. That means $12,017 if the blue continues like it did this week. What every saver longs for: preserving value in hard currency.
Argentina ranks behind Venezuela and Lebanon on the podium of global inflation. A vehicle became a store of value here. As in other countries also raw materials. “People stock up on fixed assets; Save by consuming durable goods,” says the economist Fausto Spotorno by Orlando J. Ferreres & Associates. The rarity is even greater if the comparison is only between used cars, without 0 km. For example, someone who bought a 2018 Hyundai Grand I in March 2020 and has been using it since then could now sell it for 935.10% more expensive in pesos, even if it is five years old. That means it will be able to beat inflation, which has been at 569% since then, according to Indec, but also the blue dollar, which has risen 836%. The same Volkswagen Gol Trend 1.6 model achieved similar results: it rose by 803.04% in pesos, much more than inflation and almost the same as the blue one. On average, The price of the seven main models of 2018 is well above the index: they were valued at 790.73% in pesos over these three and a half years.
Cecilia Lucca Head of public affairs at Kavak Argentina, a unicorn company that became the country’s largest car sales platform, agrees with Spotorno’s diagnosis: “There is a consumption biased towards capitalization: the used car tends to retain its value in dollars.” It loses value, but very little compared to a 0km model which loses value a lot in the first year -says-. So if you can buy in pesos and also finance yourself in pesos, inflation dilutes the debt and you end up paying very cheaply in pesos. It is a commodity that is being dollarized. Today it is a very good business and that is why we see that sales have not decreased after the devaluation, but on the contrary. A distortion occurred, opening a window of opportunity for cheap purchases until prices adjusted again“.
As of August, 1,114,700 used cars were sold in Argentina, 3% more than in the same period last year. But of course this market depends on what happens to the new ones. “The large used car factory is 0 km away,” say industry representatives. With no supply in the terminals, largely due to the lack of dollars for import and manufacturing, the availability of used vehicles is also limited and as a result prices continue to rise in both markets. “There is nothing until May next year; “Pickups only,” they replied days ago at a Toyota dealer in Barrio Norte THE NATION He asked about the Corolla Cross. “The most complicated are the cars made in Brazil,” he added. Alejandro Lamas President of the Automotive Chamber of Commerce.
For this reason, the public is looking for young used cars. Of every ten cars sold in Argentina, eight are used cars. “This is certainly due to a lack of zero inventory, but also because used cars have a greater variety of models, certainty in delivery times, prices, lower maintenance costs and fewer taxes,” the industry says.
The supply shortage also leads to situations that go beyond the wishes of the manufacturers. For example, Surcharges for the rarest vehicles. In many cases, the list values suggested by the terminals are not the true ones. Fictitious prices: the missing program.