Measuring price change for used vehicles in the Canadian Consumer Price Index

The Canadian Consumer Price Index (CPI) accounts for the sale of used vehicles by including a net expenditure weight for used vehicles in the index for the purchase of passenger vehicles. However, price changes for new cars were used as a proxy for used cars to ensure price change for this product was still covered to the best extent possible. The research paper outlines the proposed plan for introducing used vehicle prices, including data and methods. With the introduction of the 2021 CPI basket, a new approach for measuring price change in used vehicles is recommended to replace the previous method of measuring used vehicles price change by proxy.