Used car market gets even more bizarre • Hacker News Board

Re: Used car market gets even more bizarre

#261

Post by Scoundreller » Thu, Nov 11, 2021, 4:13 AM UTC

greedo wrote: post #143

CoastalCoder wrote: post #85

Earlier quoted context omitted.

I noticed a similar dynamic with general contractors / handymen a few years ago. There was a multi-year period where the demand far exceeded supply, but they didn't seem to adjust their billing rates accordingly. I never got a clear answer as to why. The one guy I talked to seemed scarred by a very demand-limited market some years prior, so maybe he was fearful of making any changes that might leave him under-employe…

I had the exact opposite occur. The missus wanted a patio installed (pavers or bluestone) and the quote we got from one guy was 10k over what others were bidding. He didn't even submit any drawings/diagrams, just told us the quote. Obviously didn't want the job. Same thing happened with a flooring guy who could have done $30k worth of work. He kept claiming he'd send us a bid but eventually ghosted us. Tradespeople c…

As you observed, a shrewd tradesperson never refuses work, they just give a terrible quote.

I had an aunt where the neighbour's son replaced a section of fence and just said to pay what they felt was reasonable and it was difficult for my aunt to come up with a number. Probably wasted a few hours coming up with that number, ugh.

Re: Used car market gets even more bizarre

#262

Post by Scoundreller » Thu, Nov 11, 2021, 4:17 AM UTC

bityard wrote: post #158

throwaway0a5e wrote: post #118

Earlier quoted context omitted.

I'm not assuming. Everyone even remotely close to the industry knows that mechanics don't like the people who want to do the bare minimum amount of work all the time and that fairly strongly correlates to "poors". Of course given the choice a mechanic would rather do an oil change on a '15 4Runner owned by some yuppie he can upsell a cabin air filter to than do a timing set on a '03 Outback for someone who'll decline…

If you were even remotely close to the industry, you would know full well that the older a car is, the more of a pain in the ass is to repair. It only takes one rusty bolt snapping off to turn a 30 minute job into a 3 hour one. When that happens, the mechanic has to eat those extra hours. They don't get to crawl back to the customer and beg for triple the price. The shop owner certainly isn't going to pony up the dif…

That's why "book time" is based on a newbie that has no idea what they're doing.

Fairly common for a job that gets charged out at X hours to only need X/2 hours. And then there's work that gets charged at shop mechanic rate but gets partly or completely done by an apprentice/assistant.

But being from the rust belt, I know what you mean about corrosion.

Re: Used car market gets even more bizarre

#263

Post by Scoundreller » Thu, Nov 11, 2021, 4:18 AM UTC

postsantum wrote: post #159

hyperman1 wrote: post #136

Earlier quoted context omitted.

To be honest, not being allowed to drive your own vehicle is probably a good thing. See e.g. https://www.cdc.gov/injury/features/global-road-safety/index... . From the first few paragraphs: Road traffic crashes are a leading cause of death in the United States for people aged 1–54 More than half of those killed are pedestrians, motorcyclists, or cyclists. Drivers risk other people's lives, hence, other people have a…

I am sure it would work great with the upcoming quarantine of 2038. Fellow citizen, for your own good, your car has been geofenced to your local grocery shop

bicycles (wo)man!

Re: Used car market gets even more bizarre

#264

Post by slt2021 » Thu, Nov 11, 2021, 4:19 AM UTC

mdavis6890 wrote: post #180

nostrademons wrote: post #156

Earlier quoted context omitted.

Usually the bank has no mechanism to alter whether you make payments or not. Keep making payments and they can't repossess the car. It'll be interesting to see what this does to the credit quality of future borrowers, which is the only leverage the bank has. Secured loans on appreciating assets mean that at some point, the bank has an incentive to write loans that they know are not going to be repaid, because they bu…

"...it becomes profitable to write loans to borrowers that you know are going to default, because you can take the house and enjoy the asset appreciation while getting a nice stream of cash flows in the process." Not the way it works, for two main reasons. First, people who owe less than the house is worth are generally not foreclosed on - in the worst case they just sell and keep whatever equity they get away with.…

the surplus comes from late payment fees, penalties, foreclosure fees, etc. On paper there is no surplus, in reality all equity is wiped out

Re: Used car market gets even more bizarre

#265

Post by Scoundreller » Thu, Nov 11, 2021, 4:22 AM UTC

Loughla wrote: post #102

hedgehog wrote: post #46

Earlier quoted context omitted.

I bought a RAV4 over the summer. There was no inventory (hint: dealer web sites will lie to you about what's actually available to purchase), I ended up reserving one that hadn't been shipped to the dealer yet and waiting for around a month for it to arrive. Autotrader shows zero of the same trim for sale used within 500 miles so not even sure what it would sell for.

Bought a new Subaru Impreza this spring. We had been saving for a couple years for my (close enough) dream car (wanted the WRX STI, but that maintenance is a real bitch). We have now had 4 calls from the dealership where we bought it offering to buy it back for thousands of dollars more than we paid this spring . So far their best offer was $6500 more than what we paid. It's outrageous.

Counter at >$8k. Always reject their first offer.

Re: Used car market gets even more bizarre

#266

Post by Scoundreller » Thu, Nov 11, 2021, 4:33 AM UTC

baq wrote: post #183

acd wrote: post #24

It would be interesting if house and car prices counted when reporting inflation figures.

housing and rent is ~1/3 of CPI. used cars are ~2.5%.

So if used cars double in price, then that's 2.5% of absolute inflation before anything else moves.

Re: Used car market gets even more bizarre

#267

Post by jiveturkey » Thu, Nov 11, 2021, 4:37 AM UTC

SilasX wrote: post #137

jiveturkey wrote: post #72

Earlier quoted context omitted.

Why are dealer market adjustments ridiculous? We live and breathe market forces. No one ever, ever, complains about market adjustments in their favor.

It’s the opposite: Normal market: “this product costs $2.60.” ‘Wasn’t it like, $2.10 a week ago?’ “Yes it was.” Cars: “This car is $26k. Oh, also you have to pay a $2k market adjustment, because man things are just crazy.” That is, in normal markets, you just raise the price , you don’t need to refer to an explicit “market adjustment”, especially not as a random addon.

It's completely fair to raise the price due to supply and demand, just as its fair to lower it. I don't think you are objecting to that, in either direction. But your complaint that it should just be called the price is a bit puzzling. Honestly, what do you (anyone) care what it's called? It's not a random addon, it's a carefully calculated (and continually tested) clearing price.

Normal market car pricing: "This car costs $26k. Oh also, we are giving $2k off because man we have so many of these. And so does the dealer in the next county over. Please buy from us. Today."

This is normal because discounts motivate buying behaviors, not because car manufacturers are laughably bad at setting MSRP. But also, it's critical for prices to be flexible regionally, and faster than the manufacturer can declare what the fair price should be.

Saturn famously tried non negotiable national sticker pricing. Just like Sears tried having no sales whatsoever. Both had to revert to standard pricing behavior.

My point? In a normal market, the sticker price is not the price.

Re: Used car market gets even more bizarre

#268

Post by noahjk » Thu, Nov 11, 2021, 4:40 AM UTC

Scoundreller wrote: post #259

csteubs wrote: post #83

Earlier quoted context omitted.

Might be anecdotal but on top of that, I've noticed that many car owners who previously only had services performed by a shop began doing their own maintenance. A friend who works as a service manager at CarMax had similar observations in conversations with some customers, including one DIY-er who forgot to torque their oil drain bolt correctly, lost the oil, and is now the recipient of a refurbished engine. I had on…

> one DIY-er who forgot to torque their oil drain bolt correctly, lost the oil, and is now the recipient of a refurbished engine. Shops make sure this doesn't happen by lazily hitting that bolt with an impact gun. Might never come off again.

We had our oil changed recently and the shop forgot to put the cap back on from the fill port (Subaru). Figured that out after 15 miles and the smell of burning oil. Engine bay was covered.

It's always something!

Re: Used car market gets even more bizarre

#269

Post by BoorishBears » Thu, Nov 11, 2021, 4:50 AM UTC

chadash wrote: post #217

Skunkleton wrote: post #210

Earlier quoted context omitted.

I wonder what gap insurance is like these days. I can't imagine that it hasn't gone up in price significantly.

Probably the opposite. If the car is worth more than you owe you shouldn’t need gap insurance.

You're thinking too short-term.

If you accept the thesis we're in a bubble that will deflate, soon cars will be worth even less than they were during the run-up, so the difference will go from positive to deeply negative in a hurry.

Re: Used car market gets even more bizarre

#270

Post by BurningFrog » Thu, Nov 11, 2021, 4:51 AM UTC

eru wrote: post #215

Wistar wrote: post #131

Earlier quoted context omitted.

A friend owns a high line/niche used car dealership and his service shop, who has a legendary mechanic, has not increased rates at all but just got more selective about the service work they are doing. Also, effectively no new service customers as they are booked solid for months.

So basically they are taking their increased compensation not in the form of more money from customers, but by improving their working conditions. It's very interesting, because this situation mirrors what economists predict about minimum wages: Employees take their compensation as a mixed basket of wages and non-monetary perks (like nicer working conditions or opportunities for learning and advancement). Different p…

I took "being selective" to mean focusing on the most profitable jobs.