CNBC, Dec. 16, 2023 – A car loses about 10% of its value as soon as it’s driven off the lot. And within the first three years, that number goes up to 50%. Depreciation — the rate at which that happens — is one of those numbers everyone in the automotive world thinks about, including consumers, automakers and the massive used car market, which made up somewhere around 35.2 million in 2022 — compared with 13.8 million new cars. But the COVID-19 pandemic turned the used car market upside down — constrained production and supply chain shortages sent prices skyrocketing and increased for about two consecutive years, unprecedented for the industry. Those odd times have led to lasting changes, and industry insiders say it is likely to stay that way.

Jeremy Robb, senior director of Economic and Industry Insights at Cox Automotive, helps explain in the latest episode of CNBC’s Shifting Gears.

Watch the episode