Peak Auto Sales; New Car Sales Are Declining

[GMFan]

It’s not just that vehicle prices are too high. We have had record inflation and supply chain shortages, however, even so, adjusted for inflation they are relatively comparable to 20/30 years ago. The problem is most incomes have been stagnated for a long time now and it’s really starting to become noticeable now with the increase in inflation. Maybe it’s that we are all slowly falling out of the middle class and noticing it in highest priced goods (houses, cars).

All I see around me are brand new trucks and SUVs. They either took on massive debt or make a whole bunch more money than I do. In either case car makers are happy to oblige as long as people keep signing on the dotted line. Why would car makers care if I’m unhappy with the car market. I don’t want their bloated $60k truck, but somebody does.

TLDR: Incomes have stagnated and people are being priced out of new vehicles, driving used prices up. Nothing will change in the car markets unless buyers do. Economics 101

 

[Burt]

In the video he points out that the peak year for new car buying was 1978 (based on percent of population). This was during the nadir of the malaise era when the cars struggled to get to 100k miles. If they did they were rust bucks. They didn’t bother to put 6 digit odometers and speedometers topped out at 85 mph. I could go on.

Point is people had to buy cars more frequently because they were crap. Now you expect the better quality, safety, economy and performance at the same price? Boo hoo.

Get used to the fact that you don’t need a new or used car as often.

 

[hemioiler]

The thing that grinds my gears the most is how they bankrupt you to get the big engine. Doesn't matter if its Ford, GM, or Ram, you're not getting their best/most powerful engines unless you spend $30k over the work truck option.

What if I just want to haul my trailer in a cheap truck and want the biggest/baddest engine around? Nope. You need to get the ultra luxury one which of course actually reduces the weight of the trailer you can pull because all those stupid options you didn't want cuts 500 pounds off your GVWR.

Completely stupid. That's why I'll likely never buy another half ton.

 

[zzyzzx]

The Maverick/ Bronco is the only exciting new car to come out in the last 5+ years that intends to meet a budget. The Trax is a blob-shaped punt with the same motivation. Heck, they tried.

If supply ever exceeds demand for either of these vehicles, a stripped down version would be nice.

 

[Torrid]

Nice that you finally don't need a $10k (sorry - $15k now) trim package from XLT to Lariat to get modern headlights for the F-150s. Super Duty trucks still have to go to the Lariat trim to get them, not even an option on XLT.

That was my only gripe about my 2017. I didn’t want leather, but I couldn’t get the upgraded lights without some expensive package and I had to have a trim with leather to get it. The halogens were abysmal on this truck. I came from a Jaguar that had very good OEM HIDs and my VW LEDs trounce those. The first drive at night with the VW after the F150 was shocking.

 

[SeaJay]

If I buy an F-150, but want leather seats, I have to step up $15k to the Lariat version over the XLT.

A friend purchased a RAV4 last year, got the base model but wanted leather. For an extra $1,500 the dealer sent it to an upholstery shop and had them installed with only a two day turnaround time. Yes, that is a lot just for leather seats but it was a a heck of a lot cheaper than moving up to the trim level that had leather. Plus they didn't have any of the higher trim with leather seats in stock.

 

[CKN]

A friend purchased a RAV4 last year, got the base model but wanted leather. For an extra $1,500 the dealer sent it to an upholstery shop and had them installed with only a two day turnaround time. Yes, that is a lot just for leather seats but it was a a heck of a lot cheaper than moving up to the trim level that had leather. Plus they didn't have any of the higher trim with leather seats in stock.

No it's not. Not for an after market install.

 

[tbm5690]

No it's not. Not for an after market install.

Yeah I was going to say the same thing...sounds like a steal if it was a quality job using descent product.

 

[BLND1]

I make great money for my area. I seem to be falling out of the middle class.

 

[nickaluch]

High cost and low quality. I am really hating all the electronics and design of the last 20 years of vehicle design.

I agree the Chevy citation was a looker with great reliability right off the showroom

 

[ProbeGT]

Obscene initial cost, poor quality, low durability, astronomical cost of overengineered replacement parts and built-in obsolescence.

Stupid govt mandates/policies take lion share of blame, followed by clueless management of most car makers and greedy unions.

In my view, Toyota is the last rational entity in the space, although even they are in decline with increased use of plastics where metal should be used.

All the tech I require in a new car is an FM radio with Bluetooth and a sturdy phone holder built into the dash. Makes tech totally future proof and easy/cheap to replace/upgrade.

 

[jeepman3071]

I make great money for my area. I seem to be falling out of the middle class.

Sometimes I think the same thing until I realize most people are swimming in credit card debt and car loans I have none. The average American can't afford a $1000 emergency.

 

[zzyzzx]

All I see around me are brand new trucks and SUVs. They either took on massive debt or make a whole bunch more money than I do.

TLDR: Incomes have stagnated and people are being priced out of new vehicles, driving used prices up. Nothing will change in the car markets unless buyers do. Economics 101

I think it's massive debt in the form of a HELOC.

 

[wareze]

I would love to get a hybrid but not at the cost they are going for right now

 

[Torrid]

It’s not just that vehicle prices are too high. We have had record inflation and supply chain shortages, however, even so, adjusted for inflation they are relatively comparable to 20/30 years ago. The problem is most incomes have been stagnated for a long time now and it’s really starting to become noticeable now with the increase in inflation. Maybe it’s that we are all slowly falling out of the middle class and noticing it in highest priced goods (houses, cars).

All I see around me are brand new trucks and SUVs. They either took on massive debt or make a whole bunch more money than I do. In either case car makers are happy to oblige as long as people keep signing on the dotted line. Why would car makers care if I’m unhappy with the car market. I don’t want their bloated $60k truck, but somebody does.

TLDR: Incomes have stagnated and people are being priced out of new vehicles, driving used prices up. Nothing will change in the car markets unless buyers do. Economics 101

It's got to be big loans because I see much the same here and I make 4x the median here and I don't have those things. Not that I want them, but I don't want to borrow the money required to have them either.

 

[jeepman3071]

It's got to be big loans because I see much the same here and I make 4x the median here and I don't have those things. Not that I want them, but I don't want to borrow the money required to have them either.

You can finance everything these days from TVs to lawn mowers.

 

[2strokeNorthstar]

I uses to drive <$3000 beaters. Now you have to spend $10000 to get a beater.

Get rid of the tech, what a total bunch of BS in a vehicle. Give me the basics. And I don't even care about LED headlights, I can get those aftermarket for $1500 if I really want them.

Manual transmission, manual windows too please.

But hey, I'm a dinosaur and I'm only 40.

I'm the same way. Traveling out of the country I'm jealous when I see the base model cars with cloth, manual trans, manual windows, non turbo and a low price.

 

[blueglide88]

If I sum up the total of the last 5 vehicles I’ve owned, it’s STILL less than a single, well-appointed Expedition. No wonder new car sales are tanking. Part of it is due to inflation, but a big part of it is due to the costs incurred for the labor to build them…

Also a large chunk part of the inflationary costs are the increased regulations that governments are imposing on car makers. Cars have become way too complicated which translates into higher costs to buy, maintain, and repair.

 

[LDM]

You can finance everything these days from TVs to lawn mowers.

Yep and for longer times than what should be reasonable. 72-96 month car loans with 8-12% interest rates. Way too much payments in interest, especially since very few people actually pay more than the regular payment every month. When I bought by truck a few years back the salesman and manager were both surprised when I did a 4 year loan on it. No one does a 4 year loan anymore. Yeah, I'm sure they don't because they care more about the monthly payment than what they would pay in interest. And I paid the truck off in 1 year so I paid even less interest than waiting 4 years to pay it off. Most people have no clue what they end up paying in interest on a loan but as long as the monthly payment is low enough its worth it.

 

[Fabulous50s]

Yep and for longer times than what should be reasonable. 72-96 month car loans with 8-12% interest rates. Way too much payments in interest, especially since very few people actually pay more than the regular payment every month. When I bought by truck a few years back the salesman and manager were both surprised when I did a 4 year loan on it. No one does a 4 year loan anymore. Yeah, I'm sure they don't because they care more about the monthly payment than what they would pay in interest. And I paid the truck off in 1 year so I paid even less interest than waiting 4 years to pay it off. Most people have no clue what they end up paying in interest on a loan but as long as the monthly payment is low enough its worth it.

Banks (and dealers) have to do this because no one could afford a new vehicle with reasonable loan times. It'd beyond me how anyone can justify going into debt on a vehicle more than a couple of years. We are talking mortgage prices for vehicles now.