US car owners continue to face the relentless burden of maintaining their vehicles, with no relief in sight. The Bureau of Labor Statistics reported a staggering 20.3% increase in motor-vehicle insurance prices in December compared to the previous year, marking the largest surge since 1976. This alarming trend of double-digit annual gains for sixteen consecutive months shows no signs of abating.
Experts from Bloomberg Intelligence predict that insurance rates will continue to rise due to the escalating costs of replacement parts and repairs. While prices of used cars and trucks have slightly decreased from their peak two years ago, the December consumer-price index revealed an unexpected uptick in used-vehicle costs, contradicting economists’ forecasts of a decline. This surprising monthly increase in the category has contributed to an acceleration in the overall rate of inflation.
Despite a decline in 2023, used-vehicle prices remain significantly elevated, having surged by 38% since the onset of the pandemic. On the other hand, new car and truck prices have not experienced the same level of increase as they did in 2022, with a mere 1% rise recorded in December on an annual basis.
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