Cardata

Consumer demand is expected to shift toward used cars as a new safety regulation and tariffs on Chinese will push up prices of brand-new cars.

The General Safety Regulations 2 (GSR2), which will come into force in early July, will add more costs to some cars according to representatives of the auto industry.

Prices in the secondhand car market had dropped for almost seven straight months, but started to pick up again in February, according to representatives of the industry.

Used car prices plunged nearly 25 percent since June last year for nearly seven months in a row but the rate of decline slowed in January. However, they increased last month, industry insiders said.

Sales of secondhand cars have been declining as more brand-new cars have become available in the market and due to the combination of other factors.

In the last three years, the prices of secondhand vehicles had been on the rise, but this stopped in July after the Trade Ministry imposed some restrictions on the sales of secondhand cars.

The combined sales of passenger cars and light commercial vehicles are expected to surpass 435,000 in the first five months, a record level for this period ever.

In May alone, sales are forecast to be above 100,000 cars, according to the people from the industry.

Due to a global shortage of semiconductors, it has become increasingly difficult to find a new car, while second-hand vehicles in dealers' inventories are depleting fast.