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The $25k car is going extinct?

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Re: The $25k car is going extinct?

#251

Post by lewisleclerc »

vel0city wrote: post #171
BLKNSLVR wrote: post #133

Earlier quoted context omitted.

My reptilian-brain logic prevents me from even considering getting a loan for car. Houses increase in value, therefore it makes a certain amount of sense to get a loan / mortgage for the purchase of a house (but mainly because no-one - in the world in which I live - can afford to buy one cash). Cars decrease in value, very quickly. Getting a loan for a car is throwing more money away than buying a car in the first pl…

Lots of loan rates out there for I could pay off my car tomorrow. But I'll have more money in the end keeping that cash in the bank. Why would I pay it off early?

I thought this was the main reason to take the loan given an opportunity. The longer the money is with me, I could use it as an investment(mostly S&P 500)

Re: The $25k car is going extinct?

#252

Post by chii »

jonny_eh wrote: post #250
ajkjk wrote: post #244

Earlier quoted context omitted.

But the question we're asking is why the price of cars went up. "Inflation" isn't an answer. Inflation is what we call the price of cars going up. It still happens for a reason...

Except that inflation isn't just the price of cars. The fact that car prices have gone up faster than "overall" inflation is significant.

cars inflating faster than overall/average inflation of the economy is significant.

I suspect the reason is that a car's parts are numerous, and because specific inflation affects different components, there's a good chance that a car's component has more inflation than other products in the economy.

And because inflation has an expectation driven aspect, suppliers that know inflation is happening is going to raise their prices more to combat it pre-emtively. This happens throughout the entire supply chain.

Thus, the end result is that a car's inflationary pressure is higher.

But that's just a theory - an inflation theory...

Re: The $25k car is going extinct?

#253

Post by jmyeet »

In 2080, Apple introduced the Macbook Air. The first version was a mixed bag. The 2010 revision was a game-changer. Competitors just couldn't compete with the hardware you got for $1200 (13"). It was an excellentcompromise between power, weight, efficiency and price. This lasted years. After awhile, 4GB of RAM was light and a non-Retina display was somewhat lacking but it was still good. A $1000 laptop is almost disposable compared to a $3000+ laptop.

But this created a problem for Apple: it was too cheap. About a decade ago, the cult of thinness took over. The Air was replaced by the 12" Macbook that was too underpowered. It only had 1 port, which doubled as a power connector. We got the (awful) butterfly keyboard. And of course we got the Touch Bar. Rumor has it that this all happened because Johnny Ive no longer had Steve Jobs pushing back against him.

All of these things only existed to increase the ASP (average selling price) of Macbooks. There's no other reason.

My point here is that companies don't want to produce cheap, quality, commoditized goods. They want high prices (because that means high profits). Apple didn't want cheap Macbooks. Car manufacturers don't want cheap cars. This is how capitalism works.

Worse though is that these high prices are used as a weapon to drive down wages. These auto makers will say "our labor costs are too high" and try and reduce wages and/or remove benefits, often under the threat of moving jobs overseas. Then you dig a little deeper and find out that about 5% of a car's sticker price is labor costs.

The chase for ever-increasing profits ultimately means cutting costs and increasing prices. Always.

Re: The $25k car is going extinct?

#254

Post by eptcyka »

MarcelOlsz wrote: post #145
zeroq wrote: post #124

Last year we bought a car. While not being a petrol head I was still living in a lala land where you could buy a brand new car for 10k EUR. Nothing fancy, just "a car". Obviously it turned out to be not true. After some digging it turned out that in the last 10 years the price of cars went double. Literally double. Same car, like Fiat Panda, with the same engine and configuration, that ten years was worth one potato…

On the other hand you could have bought a mint condition E30 late model for $10k euro.

A car without isofix, adaptive cruise and worse crash safety.

Re: The $25k car is going extinct?

#255

Post by soganess »

iancmceachern wrote: post #45
soganess wrote: post #41

Earlier quoted context omitted.

[flagged]

>>"absolutely prat" Why the personal insult? Mods is this ok per HN policy? I use and need it for work, yes big heavy things also need to be done in cities too. I noted this in my original comment. It's very tacky to personally insult a working person for the tools of their trade. You don't like the fact that a plumber needs a plumbing truck? How would a window installer get the windows to the jobsite? How do you bri…

You know what, I was out of line with that language. My apologies.

Others are right, I intended to imply "the vibe of the person" you expect when you see an F-250 in a city where even Civic park up on the curb to avoid being clipped. And that being a social cost that any Joe/Jane/Jordan pays in that situation.

Regardless, I'm not really trying to defend myself, just apologize. It was wrong of me and that choice of language was dumb, careless, inflammatory, and just plain rude.

Re: The $25k car is going extinct?

#256

Post by slg »

dingaling wrote: post #240
slg wrote: post #199

I don't know why inflation is dismissed so quickly. The article lists the industry average price increase as 29.2% and the inflation value I got out of the US Bureau of Labor Statistics calculator[1] was 26.2%. So sure, "this isn’t just a case of inflation affecting the entire vehicle market" [emphasis mine], but it is mostly that. [1] - https://www.bls.gov/data/inflation_calculator.htm

Retail inflation is based on the prices of goods, including new cars. So it's pointless to compare car prices to inflation because they are part of the basis of the measure. Hence why they track closely.

This can quickly turn into a philosophical debate rather than an economic one. Which value went up first, the chicken or the egg?

Personally, I think the way it makes the most sense is thinking of inflation as the change in the value of money rather than the change in the cost of goods, in large part because costs rise for non-goods too. For example, my employer pays me more today than they did in 2019 despite my employer not selling any goods or buying many goods outside of laptops for their employees and they obviously don't care about my personal expenses when determining annual raises.

Re: The $25k car is going extinct?

#257

Post by tokioyoyo »

999900000999 wrote: post #15
paulryanrogers wrote: post #11

Earlier quoted context omitted.

Cars are a reflection of ones personality here in the Midwest. Some grow out of it or never subscribe to the mentality. It's certainly cheaper to bicycle, weather and health permitting. Though car driving and ownership are a big cultural phenomenon, especially among men 18-50.

Depends on the man, I’ll admit in my early twenties I meet a few partners by being car free. I legit took a girl home after I asked her if she knew why the train was late. In Amsterdam at least one of the train stations has a piano. It becomes a 3rd place were people can make friends and socialize. We don’t have many 3rd places in the US where you can exist without spending money.

It is very interesting to read these threads as someone who doesn't live in the states.

Re: The $25k car is going extinct?

#258

Post by rpcope1 »

defrost wrote: post #55
jfengel wrote: post #46

Earlier quoted context omitted.

I have never seen the bed of a Cybertruck. Not a dig at the vehicle; that's a different thing. Rather, I notice that this truck doesn't seem to spend much time as a, ya know, truck. With other trucks it's less obvious because they don't have a built in bed cover. I suspect many of them also spent very little time trucking, at least here in this suburb. Perhaps it's different in more agricultural areas.

I'm in an agricultural area, have been in and around agriculture and mining for many decades, I can't see anyone buying a cybertruck for any practical reason. I've seen the offroad performance videos, the cybertruck isn't anything to write home about wrt to either ground clearance or scrabble factor (broken road hill climbing, etc). Other cheaper vehicles perform as well or better. The tray area is a nightmare, three…

An intelligent flatbed setup (what I think the Australians call "trays") is usually way better than a regular bed (barring maybe aerodynamics). A good Bradford or Circle D flatbed (as examples) can take way, way more punishment than a regular bed, and it's real easy to bring a forklift up and load pallets on the side, add boxes or tie downs, etc. One major reason you don't see a lot of them in the states is that many insurers (if you tell them you've put an flatbed on -- even a pretty aluminum one on a mini truck) will automatically assume the truck is being used in some sort of revenue service, and charge you significantly more expensive commercial rates no matter what you tell them.

Re: The $25k car is going extinct?

#259

Post by bigstrat2003 »

leakycap wrote: post #165
financypants wrote: post #148

Earlier quoted context omitted.

The small and quasi-loophole to getting a good used car deal is buying a hail damage car. I genuinely don't understand why cars were made to have shiny paint. Cars drive on dirty roads with insects and pebbles abound. Paint doesn't matter. Car washes are crazy, except to abait rust

The issue you'll face is when you go to sell it – any noticeable hail damage means you are getting 1/2 the resale value if you can even find an interested buyer.

Ideally you should be driving the car until the wheels fall off anyways. Faffing about selling cars and buying newer ones is a waste of money.

Re: The $25k car is going extinct?

#260

Post by socalgal2 »

aorloff wrote: post #74

Nobody else has said it so I guess I will. The reason the US car industry does not want a $25k car is that the financing opportunities are crap for a car of this low cost. In the same way that airlines exist to offer you a miles based credit card, the US car dealerships survive by offering you a loan for the car. Or perhaps, a car to go with your structured finance opportunity.

unless there's illegal collusion, someone will see a market opporunity and step in to fill it.

That said, a quick search for new cars under $25k: Chevrolet Trax $20.5k, Nissan Versa $17.2k, Hyundai Venue $20.5k, Kia Soul $20.5k, and Nissan Kicks $22k. Other options include the Toyota Corolla $22.3k, Hyundai Elantra $22.1k, and Volkswagen Jetta $22.5k

I think maybe the article is BS?

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