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Car Dealer Markups Helped Drive Inflation, Study Finds

Markups on new cars contributed 0.3-0.7% to the nearly 16% rise in the CPI from 2019 to 2022, according to a new study. Auto demand surged after pandemic stimulus checks, while supply-chain snarls reduced supply, causing dealer profits to rise from 4.9% in 2019 to 11.5% in 2022.

1 min read
  • Markups on new cars contributed 0.3-0.7% to the nearly 16% rise in the CPI from 2019 to 2022.
  • Auto demand surged after pandemic stimulus checks, while supply-chain snarls reduced supply.
  • Dealer profits rose from 4.9% in 2019 to 11.5% in 2022.
  • Dealer markups largely responsible for the gap between producer price index and consumer-price index.
  • New index estimates dealer markups on new cars rose to 17.7% in September 2022.
Car Dealer Markups Helped Drive Inflation, Study Finds
The money dealers charged over makers’ suggested prices factored into a nearly 16% rise in the consumer-price index in recent years
WSJBen Eisen

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