Behind The Wheel: High Demand, And High Prices For Cars New And Used In Wake Of Pandemic

TINLEY PARK, Ill. (CBS) -- People are hungry to get behind the wheel these days, but buying a new vehicle is a big challenge – because they're so hard to find.

CBS 2's Jim Williams had a look Thursday at what is ahead for dealers and car buyers.

Apple Chevrolet was a pioneer – one of the first car dealers to set up on what is now Auto Row on 159th Street in Tinley Park.

"We've been in business in Tinley Park here for 40 years. We've seen everything – ups and downs – there have been many. There's peaks and valleys," said owner John Alfirevich. "Right now, we're in a good time."

It is a good time now for Alfirevich after the pandemic forced him and his employees to be nimble – even if it meant going to a customer's home to sell cars. He said he could never have predicted a year ago that business would be like it is today when we were in the middle of the pandemic a year ago.

"Never – in fact, it was going the opposite way," he said.

Today, when new cars arrive at the dealership, they do not last long.

"I see a truck come in with cars," Alfirevich said. Before noon, I can pretty much guarantee three of them will be in someone's driveway tonight, because the demand is very strong – very strong."

The market is so hot right now that there is even a strong demand for used cars – even cars that are 10 to 15 years old.

"Used car prices are just skyrocketing," said Kelsey Mays of Cars.com. "On Cars.com, over the first six months of 2021 – median price at Cars.com dealers for used cars, just across the whole spectrum, that's up 26 percent."

Alfirevich said the once-unthinkable has happened – some drivers are getting more for their trade-ins than they paid years ago.

"We're searching for cars. We're buying your cars. We'll buy your car. The used car market is off the charts, "Alfirevich said. "If you bought a car the last two years, your car has appreciated."

Why are used cars so highly-sought now? Some drivers heading back to the office are forgoing public transportation to be safer. Computer chips in automobile's brains are scarce, and the cost of steel has jumped – slowing new car production.

As a result, there is more demand than supply – driving up prices.

"What do consumers do? When they go out and they see the sticker shock of new cars, they buy a used car instead – so all that demand is now funneling over to the used side," Mays said.

Industry experts say higher prices and reduced production could extend through the end of the year.

'We're seeing this year – I mean, overall North American production could be down, you know, 10, 15 percent once this thing shakes out," Mays said.

Still, at Apple Chevrolet, employees are back to work – and business is brisk.

"There's money out there. The economy's doing fairly well. People want to buy cars," Alfirevich said.