Financial guide: post-pandemic car shopping and gas price hacksBy James Walker
COVID-19 has caused price increases around the world with the cost of essentials like food, gas and housing all rising as a result. With populations locked down and international borders closed the global supply chain has been disrupted on a massive scale, pushing up inflation around the world and raising the cost of everything that people need to get back to normal.
Inflation and the consumer price index
Inflation is determined by the relationship between demand for goods and the economy's capacity to produce them. The consumer price index (CPI) is one of the most common ways that inflation is measured. It shows the cost of living by monitoring the prices of the most commonly bought goods and services like housing, food, transport, clothing and more to give a percentage value for the current rate of inflation. As a basic financial guide, governments like to see inflation between 1%-3% which means that the economy is growing in a sustainable fashion. Canada's inflation rate is currently 7.6% while the United States is at 8.5%.
How much does a car cost?
The COVID-19 pandemic hit the car industry particularly hard because of the number of individual parts from suppliers around the world that go into building a vehicle. Raw materials became harder to acquire as did the semiconductor chips, which control everything from engines and transmissions to electric seat motors.
The result of all this was a short supply of new cars with buyers waiting longer and turning to the used car market to fill the demand. This caused the rate of price growth for used cars to exceed even that of new cars. On Kijiji Autos, the average listing price rose by around 16% between 2021 and 2022 for new cars, while used cars' average listing price increased by 33%.
When will car prices drop again?
While new and used car prices are still rising, industry experts believe that we may be nearing the peak. With used vehicle markets beginning to cool in regions across Canada and production output of new cars back on the rise we're seeing an increase in inventory on dealership lots and this should steadily cause prices to level off.
Tips for post-pandemic car shopping
Until the automotive market truly returns to its pre-pandemic state, buying a new or used vehicle may still prove to be a headache with a shortage of vehicles and high prices. Here are a few tips you can use to grab the vehicle you want without breaking the bank.
Be flexible and quick
If you need a vehicle sooner rather than later, it could pay to be flexible with your wants. Perhaps this means giving up on a few features or buying a similar vehicle to the one you had your eye on. If you get the chance to purchase a vehicle that fits your needs, you may want to jump on it as it may not be around for long in such a busy market.
Get approved for online financing
Like shopping for anything else, the internet has made buying a car easier than ever before. Many manufacturers allow you to reserve a vehicle online and browsing through used listings and dealer sites can give you a solid idea of what you want and need in a new vehicle without travelling from place to place in person.
With Kijiji Autos Online Financing, you can enter your information online, apply for financing and get approved before seeing the vehicle in person.
Add a trade-in
Trading in your old vehicle can sweeten the deal for the seller and give you a leg up on other potential buyers as it gives the seller another vehicle to use or flip.
Even if your old vehicle is in less-than-perfect condition, a trade-in can save you money and usher you to the front of the buyer's line. Kijiji Autos allows you to add a trade-in online when you apply for financing, making your car-buying process more convenient than ever.
Know your credit score and use it to negotiate
Your credit score lets potential lenders know how risky it would be for them to provide you with a loan. Less risk for them often means a better and lower interest rate for you because it's more likely that you'll pay back the loan as agreed. A good credit score means you'll be more likely to be approved for a loan and also allows you to negotiate better car insurance rates. You can monitor your credit score with a credit report which you can access for free online through Equifax and TransUnion.
Use Online Financing
If you find the car you want to buy you can use Online Financing to quickly and simply secure a loan to purchase it. Kijiji Autos can help you finance a car and learn about your financing options to help you to get behind the wheel of a new vehicle sooner. Whether you're trading up to a larger vehicle or replacing the family car, Kijiji Autos' Online Financing can help you secure your next vehicle.
Kijiji Autos gas hacks
With everything becoming more expensive thanks to the pandemic, inflation and war, gas is one of the areas where we're forced to pay whatever the market dictates. Most of us have to drive and that means spending our hard-earned money on gas. There are, however, a few ways we can soften the blow at the pumps and help mitigate higher gas prices by altering our driving habits.
Consider an EV
One way to avoid paying for gas is to switch to a vehicle that doesn't use the stuff. While EVs are not yet as convenient as the gas cars we've come to love, they may be perfect for someone who doesn't drive very far very often. Wait times can be as long as three years for a new EV but Kijiji Autos has seen a huge increase in traffic and listings for electric vehicles over the past year.
Searches for EVs with Kijiji Autos more than doubled between the second quarter of 2021 and the second quarter of 2022, while the number of leads for electric vehicles nearly tripled.
How much is a full tank of gas in Canada?
At the time of writing, Toronto's average gas price is 161.3¢/litre while Vancouver's is 191.4¢/litre. Based on those prices a full tank of gas would cost the following amounts for these four vehicles:
- Honda Civic, 47 litres: Toronto - $75.81, Vancouver - $88.96
- Toyota Rav4, 55 litres: Toronto - $88.72, Vancouver - $105.27
- Dodge Caravan, 75 litres: Toronto - $120.98, Vancouver - $143.55
- Ford F150, 87 litres: Toronto - $140.33, Vancouver - $166.52
Even in the compact and fuel-sipping Honda Civic, these are significant sums. If you need your vehicle to get to work then there's no getting around paying them, but there are ways that you can help mitigate the effect gas prices have on your pocketbook.
Driving during off-peak hours
Stopping and starting while sitting in traffic are economy killers. Your vehicle is most efficient when cruising at a constant speed. Anything you can do to avoid traffic can help you save on fuel.
Avoid multiple short trips
Get all your driving chores done in one day if possible, rather than leaving your house to go to similar places multiple times.
Keep your vehicle well-maintained
Keeping your tires properly inflated and making sure your vehicle is happy can be a way to enhance your fuel efficiency, just as underinflated tires and mechanical issues can lead to raising your fuel consumption.
Fill up later in the day
Gas prices are highest in the morning and lower later in the day. Anecdotal evidence suggests that Saturday nights are the cheapest time of the week to fill up.
Finding the most affordable stations
Thankfully for the thrifty driver looking for "gas near me," there are a host of apps available which can help you find the closest gas station as well as compare gas prices.
GasBuddy is one of the most highly rated gas apps on both the Apple App Store and Google Play. Its prices come from crowdsourcing, so you know how much people are actually paying at the pump and the app allows you to find the nearest gas station and search by fuel type, brand and location. GasBuddy also lets you search for features like washrooms and car washes. With more than 60 million users GasBuddy is always up to date.
Gas Guru is similar to GasBuddy, but rather than crowdsourcing its price information it takes data from the Oil Price Information Service, a large price-reporting agency for the fuel industry. One of the major advantages of Gas Guru is that it tells users how recently the price was updated, letting them know if prices are still likely to be at the same level and compare gas prices.
Waze is another popular app that, in addition to GPS and speed trap information, helps you find a gas station and provides crowdsourced gas price updates. There are many apps like this out there but if you want to save money at the pump these are three of the best.
Locations and gas prices
Gas prices vary depending on where you live in Canada. Alberta typically has the cheapest gas in Canada followed by Saskatchewan, Ontario and Manitoba. The Maritimes and Quebec tend to pay the most for gasoline.
Another aspect that affects gas prices is whether the station is located in a city or somewhere less built-up. At the time of writing, gas was priced at 161.3¢/litre in Toronto while just over 100 kilometres away in Brantford the average price was 156.1¢/litre.
Obviously, we're not suggesting you make a 200-kilometre round trip to find the best gas station price, but it bears thinking about if you're out of town and heading back into the city. Filling up before you get into a large built-up area can save you a few more dollars at the pump.
Gas station rewards programs
Many gas stations offer rewards programs that could help you to save on fuel or give you other perks like free goods from their stores. Every little helps when it comes to saving money on gas, so here are four of the best rewards programs to belong to.
Esso Extra is a great one for drivers with PC Optimum cards. Esso Extra can give you four points per dollar spent on gasoline and often runs promotions giving you additional points and perks to save on fuel. You can use the points accrued anywhere that PC Optimum points are accepted including putting them towards discounts on gasoline and car washes.
Petro-Canada's rewards program gives you ten points for each dollar spent on gas or in-store with 1000 points representing $1 in savings. Points can be used to pay for gas as well as gift cards to restaurants and other businesses. Another benefit of Petro Points is that they never expire.
Journie Rewards points can be earned at Pioneer, Fas Gas, Ultramar and Chevron gas stations across the country and give you one point per litre of gasoline and two points per dollar spent in-store. Journie Rewards uses a points cycle where 75 points gets you something from the station's convenience store, another reward at 150 points and at 300 points gives you a discount of 7¢/litre during your next visit.
Shell doesn't have its own rewards program per se but it does allow customers to earn Air Miles points which can be used for gasoline, in-store purchases or anywhere else Air Miles are accepted.
We hope this article has given you a good idea of why used car prices are so high at the moment and has served as a practical financial guide on what you can do to help save money during a car purchase and at the pumps afterwards. We're all at the mercy of gas price fluctuations and the international events that cause them, but by following the tips laid out above we hope to help you go as far as possible without breaking the bank.
If you're ready to purchase a new or used car check out the huge inventory available at Kijiji Autos and apply for Online Financing to get behind the wheel sooner. Accelerate to drive with Kijiji Autos today.
James Walker is a motoring writer with a love of all cars fast and slow. Old or new, exotic or cheap, if it's on wheels and has a story he wants to tell you about it.
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