Used cars are not supply-constrained. Inventory is declining only because new car supply has been so suppressed over the past couple years, but that doesn't mean they're running out any time soon. So the opportunity cost on the individual level is as I describe: do you reutilize an existing car or do you incarnate (heh) a new one with your market participation? It's true that your new car will likely be someone else's used car, but the argument has a whiff of trickle-down-style economic reasoning that would take more space to unpack.
Further, more demand for used cars would spur the industry to reclaim/refurb salvage titles that were otherwise destined for the scrap heap and sell them on.
We could easily do this wrong, e.g. by shipping busted cars overseas, having them refurbed there, and shipping them back. Or we could do it right and create jobs in America that would stimulate economic activity locally.
This has nothing to do with trickle-down economics - it has everything to do with supply-demand curve.
All cars like this exist on the demand curve - if you don't buy it because you find it undesirable for one reason or another, someone else will. Eventually that falls so far down the curve that it's not worth anyone buying it (no demand) and it either gets scrapped, or it gets exported and someone else uses it outside of the country (which, does happen quite a bit).
Refurbing salvage cars broadly is just not worth it - the time and effort would be better spent make 10-20 new cars, rather than potentially dealing with the liability of a salvage branded car. It's why nobody wants a salvage car.
Further, more demand for used cars would spur the industry to reclaim/refurb salvage titles that were otherwise destined for the scrap heap and sell them on.
We could easily do this wrong, e.g. by shipping busted cars overseas, having them refurbed there, and shipping them back. Or we could do it right and create jobs in America that would stimulate economic activity locally.