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Comment by NikolaNovak | Hacker News Reader

Right, but... how many $1,000,000 dollar cars get sold with how many $20,000 cars, for "Industry Average" to be $40,000? :D

I notice average for Honda, Kia, Nissan etc in your linked article is $30,000... and that's explicitly exclusive of incentives and whatnots. AND inclusive of their luxury brands (Lexus, Infiniti, etc). That leaves room for lots of $20k cars, given that each of the brands has luxury models skewing the average as well.

It would be interesting to see either median, or # of cars in some representative brackets.

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For 2020 Honda only has a single model in the US that starts below $20,000, the Honda Fit. And that is only for some trim levels of the Fit. In 2019 Honda sold 35,414 Fits, out of 1,450,785 total Honda vehicles sold[1] (384,168 CR-Vs, 325,650 Civics, 267,567 Accords, being the top sellers).

So roughly 2% of Honda vehicles sold in the US cost less than $20,000, and that is without taxes and other fees. The Ford F-150 is the best selling vehicle in the US, and the average transaction price of an F-150 (as sold) is around $50,000. New cars under $20,000 basically don't exist in the US.

[1] https://carsalesbase.com/us-car-sales-data/honda/

There's two statistics I really want to see when it comes to car sales that never get posted.

1. Average income of buyer vs car price

2. Average loan totals vs car price

Because, I can tell you that those statistics will probably be absurdly horrifying.

Best example is I was sitting in a dealer and the sales guy was guiding a buyer through getting 3 separate loans for a Honda minivan because the credit union and Honda Fiance deemed him uncreditworthy for one direct loan. And that was one of the many really disturbing things I've directly listened in to.

Next recession is going to result in a complete implosion of the auto lending industry.

Don't forget average length of loans too. A lot of people are using up to 8 year loans to spread the cost even longer.

Incomes haven't kept up with car prices so the only way people have been affording the same types of cars is with extending the loan payback period and paying a lot more in interest.

Great for banks though.

> I can tell you that those statistics will probably be absurdly horrifying.

Absolutely. I know a guy who runs a few dealerships and they don't even sell cheap cars yet they buy tons of leads each month for people with bad credit who want new cars. The leads cost $50-$150/each depending on how bad their credit is. So you know that those buyers are still buying brand new cars or they wouldn't keep buying these leads. Sure, there are people with bad credit who can afford these cars, but extenuating circumstances are not the majority.

I know it's another anecdote, but from spending a lot of time on car forums, I can't count the number of discussions I've seen around what kind of car people think they can afford. There are people making $35k/yr buying $80k pickup trucks. I don't even know how that's mathematically possible unless they still live with their parents.

Car loans are absolutely horrifying.

Fascinating!

I'm in Canada, in particular Toronto, one of the couple of priciest spots up here. Not only do we have plenty of cars under $20k, we have cars like Nissan Micra that are bordering on $10k - Canadian. https://www.nissan.ca/en/cars/micra

In terms of Honda, Fit starts at $18k, Civic Sedan at $20k - again, this is Canadian, MSRP.

Toyota? Yaris starting at $17k, MSRP, Canadian. Corolla - $19K, MSRP, Canadian.

A Subaru can be had for as low as $22k MSRP.

This is particularly fascinating to me as I know Canadians feel cars are overall cheaper in US...

In the US the median vehicle price is $36K. So few $1M supercars are sold that they have no impact on the median.

To have a median of $36K implies there are some pretty cheap cars out there. Say my $20,000 is hyperbole. What would be more reasonable? the median, or say.. $30,000? Why?

$30k isn't the average either. The average is higher than the median value of $36k. You're confusing things by comparing one manufacturer to all auto sales.

And I'd say, sort of definitionally, that the median is the most reasonable figure to use here, precisely because it excludes all those insanely expensive hypercars driving the average up.

ok. so instead of $20k, lets say $30k or $36k. If I translate that into AU$ the Tesla is $70k. Its twice that price on-road costs. its one and a half times the median wage in australia.

I am sure the median car cost in Australia is nothing like that much compared to salary.

Tesla cannot compete with 'boring' cars until it can deliver 'boring' prices. If the price in the USA is within reach of boring, great: Its not yet in the UK, or Europe, or most of Asia, or Australia or New Zealand. It requires substantial support in most economies, and there is no price support for EV in Australia right now.

Why are you comparing the median cost of a car sold in the US with the average Australian wage? If you want to make that comparison, go find the median cost of a car sold in Australia. Start making valid comparisons.

Anyway, yes, it's true, EVs are not yet as cheap as the cheapest gasoline-powered cars. They're a lot closer over their lifetime in fuel and maintenance, but the up-front purchase cost is more for now. And yet they're selling like gangbusters, because people clearly want them, and the more they sell the more they can benefit from economies of scale and go further downmarket. Remember, the first Tesla targeted the expensive luxury market, and they've now managed to bring the price down by more than half. Just wait.

Sure there cars available in the US market for under $16K. So what? The reasonable price is different for every customer.

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