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The $25k car is going extinct?

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Re: The $25k car is going extinct?

#461
post #421

Earlier quoted context omitted.

> GDP per capita doesn't mean what you think it does. Everything being overpriced in the US, and everything needing to have a middleman inflates GDP figures. Take health insurance, Americans pay multiple times what Europeans pay, to stuff the pockets of multiple for profit institutions and middlemen. GDP figures look better in the US, but really, which way is more efficient? Health outcomes are better across the EU,…

> You don't need recourse to GDP, you can just look at household income which really is higher. Income would include the money being immediately spent to cover debt (be it student loans, mortgage, medical, car). > Most things do _not_ actually have inflated prices relative to European countries I'm struggling to think of things which aren't inflated. Only one I can come up with is gas/petrol/fuel, because there are m…

> netflix and co

Standard plan is £5.99 in UK, €7.99 in france, $7.99 in the US. So the US is the cheapest of those after currency conversion

> cinema

US median price in 2022: $10.53. In the UK, £7.69 == $10.54 (uncanny tbh)

> groceries

https://www.lovemoney.com/gallerylist/360768/what-a-basket-o... puts the US at $52.80, France at $51.08.

I'm genuinely struggling to understand where you are pulling these conclusions from because they don't fit the trivially searchable data, nor do they fit the anecdotal conclusions that I think most people would make from spending time in these places.

> Are interest rates favourable? There are multiple concerning trends (like car payments being one of the top household expenses and people struggling with that, people owing more on car loans than what the vehicle is worth, etc. https://www.cnbc.com/2024/10/15/american-consumers-are-incre... )

Yes, they're more favorable. The interest rates available to US consumers on auto purchases are lower than those available to UK consumers. And again, it's a case where your need to moralize is getting in the way of the topic: I'm saying that easier access to credit is a contributor to Americans spending more on cars. You are saying "oh, but Americans then struggle with auto loans". Yes! These are not conflicting statements. You seem to be attaching a value judgement that isn't there to the statement that "Americans are able to spend more on cars". It doesn't have to be a good thing, but that doesn't necessarily make it untrue.

> I'm not ranting, I'm correcting a wrong comparison using a wrong metric incorrectly. I don't know what is it with Americans reassuring themselves with GDP metrics, but it's very confusing why anyone would throw in GDP numbers when talking about disposable income and the car market.

You were the first person in this thread to bring up GDP per capita! The person you are replying to said "richer". You're the one interpreting this to be a GDP reference, but it doesn't need to be since it's also true with regards to disposable income.

I also don't understand why you think it's people "reassuring themselves". I don't need reassuring of anything on this topic, and I'm not sure why you think you know what beliefs I might hold about the relative merits of living in MS versus various European countries. I think it's a pretty basic ability to be able to decouple the question of "is the median american is willing and able to spend more money on a car than the median german?" from "which country has an overall higher standard of living?".

Re: The $25k car is going extinct?

#462

Earlier quoted context omitted.

Because they are buying new and financing it

Well, the used car market has also been decimated Cash For Clunkers took a ton of used vehicles off the market Stricter environmental standards have also taken otherwise working cars off the market, by preventing used dealerships from selling them in general, and making it more difficult/more expensive to insure them The days of buying a used car for 2 grand are long gone

Cash for Clunkers was important not because of the volume of cars it took off the market but because price points are sticky.

Before C4C garbage cars that ran but probably needed something were "I want it gone, $500". After C4C the same vehicles sold at the C4C price and the price point has more or less stuck. It completely turned the beater car market upside down.

Re: The $25k car is going extinct?

#463
post #433

Earlier quoted context omitted.

Do you consider a Ford Flex to not be a SUV ? Thing's huge and most other example you provided are either clearly SUV or are bigger than they need to be to be a "normal" car.

The Flex is close to identical in form factor and size to a pre-oil crisis station wagon. Probably has less ground clearance too. It takes the honesty of a professional political to call it an SUV.

I got no good frame of reference, but google seems to suggest it's around 13% bigger than a typical station wagon.

How is this car not considered a massive SUV?

Re: The $25k car is going extinct?

#464

Earlier quoted context omitted.

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?

I strongly agree with a generalization of the article - that cars have increased in price relative to their quality and value to the point that it's nationally problematic. There's a whole pile of cars that have gone from sub $20k to the high $20ks and above. Most of the cars you list will also have essentially non-optional packages, delivery charges, and more costs rolled into their price. At the same time it's not…

> somehow the market is broken

The market has changed and we are judging it with the old values.

https://www.investopedia.com/articles/pf/12/auto-industry.as...

Re: The $25k car is going extinct?

#465

I work on my own cars now (as a hobby really) and one of the reasons the new cars are so expensive is they are much more complicated. A lot of this seems to be over-engineering IMO. This is alluded to in the article, but not explicitly stated. The cars I work on are from the early 90s and everything is very simple to understand. e.g. Electronics are normally simple circuits that aren't much more complicated than what…

I think in time we see a similar trend with EVs. They are, by many metrics, vastly less complicated in terms of hardware. Software, of course, is another matter.

Re: The $25k car is going extinct?

#466

Earlier quoted context omitted.

That's accounted for at the time they bought it since it was already hail damaged.

Is it savings if you buy an item worth less and you pay less? You're just buying a damaged item at that point ... which is worth less to everyone That isn't getting "deal" unless you plan to never liquidate... cars generally don't get used up like a can of soda, so the dent actually matters when you go to sell it.

> That isn't getting "deal" unless you plan to never liquidate... cars generally don't get used up like a can of soda, so the dent actually matters when you go to sell it.

Yes, but it mattered already when you bought it!

In other words, the dents were already priced in when you paid for it, so you paid less. They'll like be priced even lower when you sell it after 5 years of usage.

Re: The $25k car is going extinct?

#467
Regulation is regularly increasing the cost of a car by demanding more. For example, if you demand all new cars have a rear-backup-camera, then you added a cost.

Govt is intentionally trying to cause at least 2% inflation. If you assume only 2% average over 50 years. A $25,000 car then is only about $9000 today; an untenable proposition. Lets be realistic, do you genuinely think no government in 50 years will exceed 2%?

The $25k car is extinct.

Re: The $25k car is going extinct?

#468
post #276

Earlier quoted context omitted.

Yes, but you also paid half the cost to acquire the car. You're just paying less in depreciation for the time you use it.

My last car got minor hail damage across many panels, it was a difficult PDR for some reason - when I traded it in it was worth 1/4 what KBB would have been for a similar year and mileage without dents Even trying to sell it myself for around 1/3 KBB "good" value took 2 months because the next buyer can't get financing on a car worth very little, so you have to find a cash buyer who doesn't care how their new ride lo…

> next buyer can't get financing on a car worth very little, so you have to find a cash buyer who doesn't care how their new ride looks.

The idea is to be the next buyer who is paying very little because of the hail damage.

Re: The $25k car is going extinct?

#469

Earlier quoted context omitted.

The main point here is that it sounds a lot like a zero sum game, people are struggling to catch a bigger share of a limited "safety" pie while manufacturers instigating the mass war are watching their profits increase. It's not clear at all to me how a crash involving two SUVs is much safer than, say, a 2 bike crash, and in fact there is a particular type of accident (front-overs of children) than trucks are strongl…

Except they're not though. Buyers are juggling many more criteria and safety is only a "nice to have" after fitness for purpose is achieved. Like no amount of internet fanboys screeching about Volvo's safety record will make someone who wants a roadster buy one over a Miata. While I'm sure there is some amount of the affect you're describing the lion's share of it is likely CAFE rules favoring larger footprint vehicl…

> It is by the simple physics

Is this a personal theory, a hunch, or do you have data or citations?

> of having more distance to dissipate force over and less distance between the occupants and stuff in the cabin.

So what we need are bigger vehicles made out of lighter materials, to increase the distance and reduce the forces, perhaps some comically large Styrofoam bumpers protecting our bikes? Now, I can get behind that.

> safety is only a "nice to have"

Buyers are a diverse group, you know. There is a substantial segment that rates safety as a the top priority, and there is very little doubt the SUV mass race is strongly related to the "perception of safety" larger vehicles provide, of course not to the actual safety reality and externalities they incur to the rest of society.

Another substantial segment is driven by the "perception of masculinity" their large vehicles provides. You couldn't make up this level of lameness.

Re: The $25k car is going extinct?

#470

Earlier quoted context omitted.

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?

Your logic works out fine if you don't mind a dash of risk (e.g. from a job loss). But when I ran the numbers from my perspective it didn't seem worth it. (I might be doing my math wrong). Let's say I get a car that costs $30k, I put $10k down, and I take a loan out using the numbers above rounded up just for napkin math (1% APR, 4% savings account). After one year: ``` $30,000 x 0.04 = $1,200 from savings account in…

I don't live in California, taxes are less. There is no risk from a job loss, I could pay it off tomorrow. You're also only looking at one year of a several year loan.

Sure, more expensive buying a new car. But I was going to get a new car anyways, the question is loan or no loan.

I don't care too much about depreciation. It'll probably be in my garage for a decade or more so that's just paper losses today, and once again I was going to buy new anyways.

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