Tops among the segments seeing prices rise is insurance, says DesRosiers Automotive Consultants, who pegged premiums rising more than 8% year over year as of June 2024

A number of contradictory forces are causing different automotive market segments–some affecting the aftermarket more directly than others–to see varying levels of price inflation.

Tops among the segments seeing prices rise is insurance, says DesRosiers Automotive Consultants, who pegged premiums rising more than 8% year over year as of June 2024. Insurance is regularly at the sharp end of price increases, but in the more discretionary segments of the economy, like the aftermarket, prices are moderating as markets normalize.

Over the period 2021-23 inflationary pressures were rampant throughout the economy and nowhere more than in the used vehicle market.

However, used vehicle purchase prices have reversed course and started to decrease, dropping 4.5% compared to June of last year.

This is in contrast to new vehicle CPI which remains positive at 1.8%, supported by the twin moves toward SUVs and ZEVs.

DAC says that dynamics are shifting as new vehicle supply shortages are resolved, and the Bank of Canada starting a rate cutting cycle. Pockets of inflation persist, it insists – like the aforementioned insurance spike – but other segments are seeing less price growth.

• Passenger vehicle parts and maintenance, says DAC, saw a 3.5% increase as a category.
• Maintenance and repair services themselves seeing a 4.2% increase and parts CPI up 2.9%.
• Gasoline, meanwhile, acting as something of a stabilizing force–proof that anything is possible in this economy–and came in flat for June.

Andrew King, Managing Parter at DAC commented that “It is clear that the automotive market is seeing countervailing forces at play.”

He continued, “The new and used markets are heading in different directions as industry dynamics reshuffle the landscape and the market works toward a new equilibrium.”