WaPo -- New cars out of reach for many

[Anonymous]

We buy new but drive them until the wheels fall off. Our 2010 Suburu is still my daily driver. However it needs a new exhaust and the air conditioning doesn’t work. Don’t care that much. I’ll probably trade it in for peanuts in two years.

[Anonymous]

Anonymous wrote:We buy new but drive them until the wheels fall off. Our 2010 Suburu is still my daily driver. However it needs a new exhaust and the air conditioning doesn’t work. Don’t care that much. I’ll probably trade it in for peanuts in two years.

I recently sold a 2002 Honda Oddysey and got over 2k for it going to one of those trade in places. It was a base model and was a mess. The mileage was low for its age though.

[Anonymous]

Anonymous wrote:

Anonymous wrote:People who buy new cars are either rich or bad with money. Sometimes both.

This used to be true, but cars last a lot longer now and these days buying used is not always a better deal.

+1

I've never purchased a new car, but right now my choice is:

(a) New 3 row SUV in mid-range trim for ~45K.

(b) Same car 2 years used for ~$36K.

I typically keep cars for approximately 8 years, would extend to 10 with a new car.

Looks like pretty much a wash to me:

Used: $36K/8 years = $4,500 per year ownership cost
New: $45K/10 years = $4,500 per year ownership cost

I assume residual value after ownership would be roughly a wash.

[Anonymous]

Used cars have been over priced for years now. We prefer to buy new and drive them forever. Our newest car is a 2012, our oldest car is a 2006. Both were purchased new. I think we got our money's worth.

[Anonymous]

Anonymous wrote:Used cars have been over priced for years now. We prefer to buy new and drive them forever. Our newest car is a 2012, our oldest car is a 2006. Both were purchased new. I think we got our money's worth.

Sorry, to add: We still use both daily. We've wanted to upgrade to a minivan but are waiting for one of the existing cars to die, and the darn things just keep on going

[Anonymous]

Anonymous wrote:

Anonymous wrote:Used cars have been over priced for years now. We prefer to buy new and drive them forever. Our newest car is a 2012, our oldest car is a 2006. Both were purchased new. I think we got our money's worth.

Sorry, to add: We still use both daily. We've wanted to upgrade to a minivan but are waiting for one of the existing cars to die, and the darn things just keep on going

Yeah, this is the downside to how reliable some cars are! We have a 2011 Hyundai and 2012 Mazda still going strong. They were pretty basic models and I'd like an upgrade but have a hard time justifying the choice vs. adding to retirement savings, when they still run fine. I shop online periodically and then decide not to bother.

[Anonymous]

Our first two new car purchases - a minivan (2003) and sedan (2010) are still perfectly fine and operational. We'll replace them when they stop running or close. Prob. replace the van with a 5 or 7 seater SUV (maybe hybrid?) and the car with an electric.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People who buy new cars are either rich or bad with money. Sometimes both.

This used to be true, but cars last a lot longer now and these days buying used is not always a better deal.

+1

I've never purchased a new car, but right now my choice is:

(a) New 3 row SUV in mid-range trim for ~45K.

(b) Same car 2 years used for ~$36K.

I typically keep cars for approximately 8 years, would extend to 10 with a new car.

Looks like pretty much a wash to me:

Used: $36K/8 years = $4,500 per year ownership cost
New: $45K/10 years = $4,500 per year ownership cost

I assume residual value after ownership would be roughly a wash.

And with a new car, you know what you are getting. I always question why someone would be selling an originally $45K car after 2 years? Whats wrong with it? IMO much better to buy new and have the full warranty.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:This article depressed me. The big takeaway for me is that car manufacturers are doing away with entry level models. DD is graduating college and will need to purchase a car. She’s been saving for a down payment but she will never be able to afford something new at these prices and interest rates. DH has spent months looking for a safe and reliable used car for her but those prices are insane and forget about financing it.

They're not doing away with entry level models. However, while supply chains remain constrained, and they can only manufacture a certain number, they need to focus on the most profitable ones for now.

Maybe you haven’t paid attention in the last couple of years. They are actually doing away with entry level models.
Ford and GM used to sell small and cheap entry level cars like the Ford Focus or Chevy Cruze. They have been discontinued.
The entry level Ford is now the Ford Escape, an SUV.
Japanese brands will soon follow. The Honda Civic and Toyota Corolla will be discontinued in the US and replaced with their SUV-like versions.
Manufacturers figure that they can take a car, make it slightly bigger and raise the ground clearance, and sell if for $10k more.

Volkswagen Jetta $20k
Hyundai Elantra $20k
Nissan Kicks $20k
Nissan Sentra $19k
Kia Soul $19k
Subaru Impreza $19k
Kia Forte $19k
Hyundai Venue $19k
Kia Rio $16k
Mitsubishi Mirage $16k
Hyundai Accent $16k
Nissan Versa $15k

https://cars.usnews.com/cars-trucks/advice/cheapest-cars-on-the-market?slide=3

Good luck finding those trims on the lot

[Anonymous]

My parents never once bought a new car when we were growing up. My mom bought her first new car in 1970 (a vw bug) when she got her first job and didn’t buy another new car until 2015. This is not new.

[Anonymous]

Anonymous wrote:My parents never once bought a new car when we were growing up. My mom bought her first new car in 1970 (a vw bug) when she got her first job and didn’t buy another new car until 2015. This is not new.

The new part is used cars beginning to approach the price of new cars. The number of people dropping to the very used market is increasing

[Anonymous]

Anonymous wrote:

Anonymous wrote:People who buy new cars are either rich or bad with money. Sometimes both.

This used to be true, but cars last a lot longer now and these days buying used is not always a better deal.

That doesn't make sense. If cars last longer, then buying used is a better deal than it used to be because you are buying a longer lasting car.

There was a brief period during Covid when supply chain issues inflated the value of used cars. It was a very specific issue that had to do with not only supply chain problems that disrupted making/delivering new cars, but also the massive disruptions to the travel industry (car rental places are one of the primary buyers of new cars and sellers of used cars) and other weird, Covid-specific stuff.

But it's over. There are plenty of used cars on the market and you can continue to get them at a significant discount to new. I just bought a used car (2020 model) for 15k less than the new version would be. Single owner, low mileage.

There may be some particularly in-demand models where it is hard to find them used or where the used version is more expensive than you'd expect, but then just be less picky about the car you buy.

[Anonymous]

Anonymous wrote:

Anonymous wrote:My parents never once bought a new car when we were growing up. My mom bought her first new car in 1970 (a vw bug) when she got her first job and didn’t buy another new car until 2015. This is not new.

The new part is used cars beginning to approach the price of new cars. The number of people dropping to the very used market is increasing

It's self correcting though. People can see the price of the new car and the price of the used car, and as the price of the used car approaches the price of the new car, they stop buying used and buy new instead. And then the price of the used car drops. With transparent pricing, it doesn't make sense that the price of used would ever actually approach the price of new. Consumers are more rational that that.

The only time this could be true is when new cars are so hard to come by that used is your only option. And that was true for a time but is no longer true. And even then, you're talking about recent model used cars. Like during the supply chain problems, someone might have bought a car that was 1-2 years old for the same price as new, simply because they didn't want to wait a year until the new car was available. But a car that is 5 years old? Still much cheaper.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:People who buy new cars are either rich or bad with money. Sometimes both.

This used to be true, but cars last a lot longer now and these days buying used is not always a better deal.

That doesn't make sense. If cars last longer, then buying used is a better deal than it used to be because you are buying a longer lasting car.

There was a brief period during Covid when supply chain issues inflated the value of used cars. It was a very specific issue that had to do with not only supply chain problems that disrupted making/delivering new cars, but also the massive disruptions to the travel industry (car rental places are one of the primary buyers of new cars and sellers of used cars) and other weird, Covid-specific stuff.

But it's over. There are plenty of used cars on the market and you can continue to get them at a significant discount to new. I just bought a used car (2020 model) for 15k less than the new version would be. Single owner, low mileage.

There may be some particularly in-demand models where it is hard to find them used or where the used version is more expensive than you'd expect, but then just be less picky about the car you buy.

It is, but the dealership cartel doesn't want to let go of that shortage situation and continues to pretend that there is still a shortage. Gimme a break! I'm not buying any car until I can get it for a lot under MSRP. That's how I've always done it. I'll just wait and bide my time.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:My parents never once bought a new car when we were growing up. My mom bought her first new car in 1970 (a vw bug) when she got her first job and didn’t buy another new car until 2015. This is not new.

The new part is used cars beginning to approach the price of new cars. The number of people dropping to the very used market is increasing

It's self correcting though. People can see the price of the new car and the price of the used car, and as the price of the used car approaches the price of the new car, they stop buying used and buy new instead. And then the price of the used car drops. With transparent pricing, it doesn't make sense that the price of used would ever actually approach the price of new. Consumers are more rational that that.

The only time this could be true is when new cars are so hard to come by that used is your only option. And that was true for a time but is no longer true. And even then, you're talking about recent model used cars. Like during the supply chain problems, someone might have bought a car that was 1-2 years old for the same price as new, simply because they didn't want to wait a year until the new car was available. But a car that is 5 years old? Still much cheaper.

GM in particular likes the shortage and is adamant that the days of chasing volume at the expense of margin are over. Until one of the manufacturers breaks rank and tries to grow via volume and discounts, the current market seems here to stay.