Need a new car? Better have deep pockets.

LVSteve · Oct 10, 2023

A number of recent threads on here have expressed shock and dismay at the prices of new vehicles. The average transaction for a new vehicle today is something daft like $48k. It's made worse by the Big 3 pulling out of the low profit end of the market. They just don't make small, economical, low-cost vehicles any more. Gosh, wonder where oil prices are likely to go just now?

Read something today that puts the whole horror of this in easy to read terms. Article in Motor says that nearly 18% of new car buys involve a monthly car payment of $1000 or more.

Yes, one thousand dollars a month plus any servicing and repairs to own a depreciating asset. Oh, and if you are a multi-car household, with prices and credit "working" as they are, don't ask to have more than one loan running unless you make a six figure salary.

How much of this is the new economics of production, and how much is down to "gotta have it" trampling good sense in people's household budgets I cannot say. What do y'all think?

Access Denied

Just ignore the "Access Denied" rubbish, the link works just fine.

boykinlp · Oct 10, 2023

Plus the increase to your insurance for these extremely expensive vehicles. When I was looking at buying a new Ford Mustang Mach 1, my insurance was going to increase by $3000+ per year!
Larry

oldbrownhat · Oct 10, 2023

LVSteve said:
...They just don't make small, economical, low-cost vehicles any more...

Nor cars not crammed with bell and whistles and electronic claptrap, and ever more difficult to service. A downside of this is that used cars will likely increase in price as demand increases.

We need the modern equivalent of the original 1937 "Volkswagen" = "people's car" concept, ie basic transportation. And not something that "needs" to be restyled and updated every year.

“If we can put a man on the Moon, we surely are capable of... building and marketing a basic automobile."

rct269 · Oct 10, 2023

boykinlp said:
Plus the increase to your insurance for these extremely expensive vehicles. When I was looking at buying a new Ford Mustang Mach 1, my insurance was going to increase by $3000+ per year!
Larry

This may or may not be applicable here, but many/most (??) automobile insurance underwriters (the folks who decide which risks they are going to accept, and at what price) have what seems to an inborn aversion to high performance cars-----never mind your age/driving record/experience, or anything else. If the car has more than X horsepower/acceleration capabilities/horsepower to weight ratios/whatever other measuring sticks they choose to use, then you/your car are deemed to be other than a standard risk.

Enter the non-standard/high risk insurance carriers. These folks will insure pretty much anybody/any car. The operative slogan here is "This is serious business---bring money!"

That said, there actually are standard risk insurance companies who, while they're not all that eager to accept this sort of business, will do so---at standard rates----IF you/other drivers present an acceptable record---never mind what sort of car it is----and it doesn't hurt to have ALL of your personal insurance business with ONE company.

The moral of this story is shop around. Shopping around is best performed by an Independent Agent (one who represents several companies), and sees their job as helping you buy your insurance. Their opposites in this industry are known as "direct writers" (employees of an individual company) whose job is to sell the products of their employer.

Ralph Tremaine

johngalt · Oct 10, 2023

Insurance for my ‘98 Corvette is cheap.

BigBoy99 · Oct 10, 2023

The cost of the last vehicle I bought was three times the cost of my first house!

Telecaster · Oct 10, 2023

Either Americans are wealthy enough to spike demand for luxury cars (these would have been luxury cars a decade or two ago), or something’s just really askew. We’re told the economy sucks, but preople are buying $50k vehicles, living in $2k apartments, and buying $500k homes. Well, someone is. I’m sure not doing that.

They won’t be selling us Beetles because dealerships make their money on maintenance, simple as that.

Narragansett · Oct 10, 2023

I was talking with a GM at my VW dealership the other day, and he said many of the new car loans are over 1000.00 dollars. I read also that the average car loan is now 750.00 He also said and I read that repossession is on the rise, so I think the bubble is going to burst.

I was actually looking at cars this morning online. 45K for a 2 year old 2WD 4cyl Chevy Silverado with 43K miles. Who would want that, and the gas mileage was terrible.

I have a 2015 VW Jetta Sport with 93K on it. 170hp, 32/41mpg, 5 speed MT. It is in outstanding shape, and runs perfectly. I paid 21K OTD taxes and all. I just put the 3rd set of tires on it. I intend on keeping this till the wheels fall off or I can't get in and out of it.

.

Your surest way to protect the longevity of your car is to change your oil. If the manual says 10K miles, do it at 5K. While oil technology has gotten better, filters not so much

kozmic · Oct 10, 2023

There is no such thing an inexpensive, simple "work truck". Entry level for a plain Jane pick-up is well north of $30k and is easily pushed well beyond 40 grand.
I'm not bragging and am somewhat embarrassed, but my '23 GMC 1500 Sierra Denali had a list of $82,000. There is still a long list of option it doesn't have.

Alton · Oct 10, 2023

I heard a UAW worker who said if GM would just give into the demands the increase on a new vehicle would only be 5%, not that big of a deal! Your new Denali would only be an additional $4,100 or $86,100. With the price of homes in Texas doubling, insurance going up 20% due to cost and theft, not sure about the rest of America, but Texas is getting ready to stop.

DWalt · Oct 10, 2023

I have recently read several articles which prognosticate that prices of used vehicles, especially those gasoline powered, will escalate enormously over the next ten years, if not before. In my case, I will very probably never again buy another vehicle, unless one of mine is totaled as a result of a collision or some natural catastrophe. I will just keep my already old old vehicles (10 and 20 years respectively) rolling. I can see the automobile situation in the USA coming to resemble Castro-era Cuba where the sight of 50+ year-old cars on the street becomes common.

glenwolde · Oct 10, 2023

Used cars are just as bad, they're climbing with the cost of a new one. The good news: if you have one you'll get more on trade-in than you would otherwise which will help with the new one.

We had a 2019 F350 DRW diesel we bought new. It was a "work truck", XL, vinyl seats, nothing fancy. We paid $50,000 for it in 2019 and sold it in 2021 for $55,000 to CarMax. But that just eased the pain a little of what we had to pay for a used 2019 F250 SRW short bed.

We downsized our RV and we wanted to downsize the truck too. Now we're getting rid of the RV maybe and the truck is going to go if the RV sells. If the RV doesn't sell we're going to take off to someplace cooler next summer. Meanwhile we get free storage for six months at the consignment dealer!

yaktamer · Oct 10, 2023

Alton said:
I heard a UAW worker who said if GM would just give into the demands the increase on a new vehicle would only be 5%, not that big of a deal!

Last I saw, they were asking for a 40% pay increase and a 32 hour work week. Not buying that a 60% labor cost increase translates to a 5% retail price increase.

Narragansett · Oct 10, 2023

yaktamer said:
Last I saw, they were asking for a 40% pay increase and a 32 hour work week. Not buying that a 60% labor cost increase translates to a 5% retail price increase.

5% is a lot, but you need to look at the actual man hours of labor that go into a car. I think it is something like 30 or so. Robotics do most of it. Unlike Rolls Royce that takes 2 men 4 days to hang a door

yaktamer · Oct 10, 2023

DWalt said:
I have recently read several articles which prognosticate that prices of used vehicles, especially those gasoline powered, will escalate enormously over the next ten years, if not before. In my case, I will very probably never again buy another vehicle, unless one of mine is totaled as a result of a collision or some natural catastrophe. I will just keep my already old old vehicles (10 and 20 years respectively) rolling. I can see the automobile situation in the USA coming to resemble Castro-era Cuba where the sight of 50+ year-old cars on the street becomes common.

I think this may be true. Internal combustion powered vehicles (and parts therefor) will sell at a premium, provided the government doesn't ban sale of fuel as a final move to force everybody to drive electrics. I've always preferred driving trucks to cars, but a few months ago I decided that I was tired of making the payments, insurance and gas for my 2019 F-150. Because I found I wasn't really using it as a truck very often, I sold it and switched to driving the 2011 Corolla beater that was my kids' high school commuter. Sure, it has some body damage and upholstery stains, but at 165,000 miles it's just getting broken in. I figured I'd drive it until it dies, and then get something nicer. But I'm thinking about getting a second 2011-13 Corolla now and driving it just enough to keeping it from rotting away. When the older Corolla dies I'll already have a replacement, and maybe a parts donor as well.

oldbrownhat · Oct 10, 2023

yaktamer said:
I... Because I found I wasn't really using it as a truck very often, I sold it and switched to driving the 2011 Corolla beater that was my kids' high school commuter....

By the time I need to replace my 2011 Ford Ranger, I likely won't really need a pickup (or, given they're pretty reliable and I'm 71, be too old to drive

) and will probably look for a Toyota, Subaru or Honda hybrid, maybe a SUV.

Buzzzer · Oct 10, 2023

Two who never lose money, lawyers and insurance companies...

It's pretty unbelievable what they get for vehicles nowadays, especially trucks that usually get parked in town, never get dirty and never pull anything. Most of the trucks I see can't haul much with their short boxes. However, I'm not one to tell someone else how to blow their money.

What's that old saying about a man who doesn't have it where it counts and has to make up for it somewhere else?

All sarcasm/joking aside it's not just vehicles, motorcycles also have an uptick in repossession. Read an article the other day about a $50,000 Harley Davidson!

Harrison · Oct 10, 2023

Our two 2020 Toyota SUVs are fully paid for and will probably, with scheduled maintenance, will outlast my wife and I.

dave1918a2 · Oct 10, 2023

Never purchased a new vehicle in My life. Always bought used. Right now I have a 2003 4Runner with 137K miles and a 2001 Corvette with 45K miles. Up here insurance is 1/3rd of Colorado. Mainly because of lack of traffic. My Dad never bought a new vehicle either. Said "Let some other poor sucker pay that first $2000 depreciation". Now that depreciation is 20K. Of course if Dad knew I paid $10K for a 19 year old Toyota with 121K miles on it, He would flip over in His grave. Of course in His day a new Cadillac was $3500.

smoothshooter · Oct 10, 2023

That’s why I only buy vehicles that are at least 10 years old.
I can have a lot of repairs done if needed for the amount of money that 3 or 4 payments on a new truck would be.

I save a lot of money on insurance, too.

Need a new car? Better have deep pockets.

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