An example of inflation in the automotive world.

[OVERKILL]

For the folks concerned about fuel injection and power options, we could use a more recent example.

The 1987 Ford Mustang GT (hatchback) had an MSRP of $11,835 apparently. The GT was pretty well equipped, had a low oil sensor, real gauges, cruise control, power windows, power locks, power mirrors, Sequential Electronic Fuel Injection, limited-slip rear-end. I think A/C was optional.

You adjust that for inflation and you get $31,000. 1990 when they added air bags is within spitting distance, adjusted.

The current 2023 GT starts at $42,500, so that's roughly an $11,000 premium over the late 80's/early 90's version. Yes, it has a touch screen infotainment system now, and more HP (and more airbags, and better crash test performance).

Would be interesting to plot this in a spreadsheet, using MSRP and inflation adjusting each year to see the trend.

 

[Number_35]

On a side note but related to my comment above, we are currently talking about government regulation and the unintended consequences of regulation in my economics class. I'll preface this with in spite of being told I go to a liberal university where I'm being indoctrinated into lunacy, the text we use was written by an economist who worked for George W. Besides the usual supply-demand curve stuff my takeaways so far are: 1. Rent control doesn't work and makes housing worse; 2. Printing too much money is the reason for inflation; 3. Government regulation usually backfires; 4. Government handouts eliminate the motivation to work. All this and I'm only 1/3 the way through the textbook.

My example related above - When seatbelts were first mandated it did little to reduce overall deaths because while it did save some lives of people in the vehicles, the people driving the vehicles drove more recklessly since seatbelts made them feel safer and the magnitude of the crashes were greater (people would speed more) and more pedestrians were killed. The example discussed in the book was just about seatbelts but it would be interesting to know how much of the safety systems we pay for now actually reduce fatalities since we spend A LOT of $ on these safety systems.

Is your textbook Basic Economics by Thomas Sowell?

I agree rent control tends to reduce supply, thus driving up prices.

I suspect seatbelts have dropped the driving death toll significantly. I recall from childhood (late 1960s) where the annual death toll in the U.S. was stated to be 50K.

Now it's way lower in spite of a much larger population and presumably way more miles driven.

Confounding factors might be better driver education, DRLs (in certain jurisdictions), crash-test ratings, radial tires, better roads, and probably a bunch of stuff I haven't thought of.

 

[PWMDMD]

Is your textbook Basic Economics by Thomas Sowell?

I agree rent control tends to reduce supply, thus driving up prices.

I suspect seatbelts have dropped the driving death toll significantly. I recall from childhood (late 1960s) where the annual death toll in the U.S. was stated to be 50K.

Now it's way lower in spite of a much larger population and presumably way more miles driven.

Confounding factors might be better driver education, DRLs (in certain jurisdictions), crash-test ratings, radial tires, better roads, and probably a bunch of stuff I haven't thought of.

Essential Economics by N. Gregory Mankiw.

 

[gman2304]

I owned a 1973 Chevy Impala custom coupe. 350 four barrel, dual exhaust, TH350, summit white with blue vinyl top and vinyl interior. AC, power steering/brakes, am/fm radio and..
wait for it…….factory fender skirts! It was one of the top five best cars I have ever owned and I remember the day and where I was at when it rolled over 100,000 miles. I do remember having the steering box rebuilt because of leak but that was it except for normal maintenance. I used Pennzoil 10w30 changed every 3,000 miles. I remember the Pennzoil bottle had “ with Z7 “ printed on the bottle… always wondered what sort of additive the Z7 was, marketing most likely but it worked. I traded it in for a 1981 Monte Carlo which was a real of a car!

 

[PWMDMD]

Your point is valid with regard to tech/airbags/abs etc. But by the 70's the better cars were very comfortable and reliable appliances, just like today. A tool to transport people to desired destinations. A car then is a car today.

We can't simplify the similarities to 4 wheels and the ability to carry people. The Caprice mentioned had good tech for its day, could carry 2+ more people, more cargo, could tow a boat, had powerful AC, and was big enough to sleep in when your camping spot flooded (ask me how I know). The fact is, you got twice the vehicle for your money back then. It may not all be inflation, but the fact remains.

I'll agree that for its time the Caprice was probably the height of technological advancement. Still, I also think we can't discount the addition of technologies that cost money to develop and manufacture being added to vehicles. What were the equivalent R&D and manufacturing costs with respect to heads-up displays, 360 cameras, lane departure, ABS, traction control, cross-traffic avoidance, lane departure, forward collision warning/braking, blindspot warning, etc in the Caprice? These, as well as many other technologies, represent NEW costs that did not exist in the time of the Caprice - surely, they add some expense above and beyond inflation to the cost of modern vehicles that simply did not exist in the time of the Caprice?

 

[Zee09]

The Impala in the pic lacks a right side mirror.

They didn't come standard with them in the day...

 

[Drifter]

Had a 73 Impala. 4dr sedan. 350 2v 350 turbo. The worst gas guzzling car I have ever owned. Maybe the differential was geared low. Drove nice and I felt safe in it though. Traded it for 75 Delta 88 455 4v and got better mileage.

 

[Number_35]

I owned a 1973 Chevy Impala custom coupe. 350 four barrel, dual exhaust, TH350, summit white with blue vinyl top and vinyl interior. AC, power steering/brakes, am/fm radio and..
wait for it…….factory fender skirts! It was one of the top five best cars I have ever owned and I remember the day and where I was at when it rolled over 100,000 miles. I do remember having the steering box rebuilt because of leak but that was it except for normal maintenance. I used Pennzoil 10w30 changed every 3,000 miles. I remember the Pennzoil bottle had “ with Z7 “ printed on the bottle… always wondered what sort of additive the Z7 was, marketing most likely but it worked. I traded it in for a 1981 Monte Carlo which was a real of a car!

A friend worked for the provincial department of highways as a summer job in 1977. He saw hundreds or perhaps thousands of cars per day.

He said that generation ('71 - '76) of Chevy along with the later ('67 - '76) Valiants and Darts seemed to make up the majority of cars he saw.

All that to say, these Chevys, the last ones before the downsizing, were incredibly popular in their day.

 

[RedSpider]

We had a '73 Caprice wagon when I was a kid. I learned to drive on it. The 400 pulled it very well but the gas mileage was dismal. It had a/c, crank windows, and a neat switch that lowered the back window. I remember no other features, other than FM radio. It also had rust, which started about 20 minutes after young me and dad got home with it. Considering my dad was not the mechanic car guy type and did almost zero maintenance to it, it was pretty reliable. Once I got into junior high I was pretty much the only person taking care of it, tie rods and shocks is about the only thing I remember it ever needing.

 

[twouvakind]

There's more to it than inflation.
The '73 Chevy didn't have fuel injection, an overwhelming batch of sensors and a central processor to digest all the inputs, an array of airbags, sophisticated automatic transmissions, ABS + Stability systems, SNE (Stupid Needless Electronics), cruise as standard, tilt wheel as standard, alloy wheels as standard, likely a sunroof as standard, self tensioning seat belts, actual designed body cages.....

Three cheers for power and roar but I don't miss Detroit pig iron as part of the landscape.

Or the Ford Pinto, how about you fellow BITOG fans?

 

[John105]

Is your textbook Basic Economics by Thomas Sowell?

I agree rent control tends to reduce supply, thus driving up prices.

I suspect seatbelts have dropped the driving death toll significantly. I recall from childhood (late 1960s) where the annual death toll in the U.S. was stated to be 50K.

Now it's way lower in spite of a much larger population and presumably way more miles driven.

Confounding factors might be better driver education, DRLs (in certain jurisdictions), crash-test ratings, radial tires, better roads, and probably a bunch of stuff I haven't thought of.

It amazes how much disregard there is, as if in protest. In 1992 driver instruction began saying to no longer keep hands at 10 and 2. Here it is 2023 yet many do that.

Here in PA, a car can be parked on an extreme incline. Wheels straight ahead. In San Francisco, curbing front wheels is the law, not merely common sense. Kinda fascinating that although people behave cluelessly more than ever, accidents are down due to maybe the vehicles themselves…

 

[ekrampitzjr]

In 1992 driver instruction began saying to no longer keep hands at 10 and 2.

What's the instruction now? "One hand on your coffee cup, the other on your cell phone, knees keeping the steering wheel steady"?

 

[Hillbilly Deluxe]

My mother had a 1971 Chevy Impala (Carpice-same thing). Didn't make it 80k miles. Leaked oil like the Exxon Valdez starting around 40k miles. I remember her having to put a quart of oil in it every 500-600 miles.

The Honda Civic (well one from the early 2000's) will go 300k with oil changes, brakes, alignments, filters, coolant change and washing it every now and then.

The Caprice will need to be rebuilt 3-4 times in 300k miles.