Renting a car will be a pain until at least 2022
latimes.com
latimes.com
What I hadn't appreciated was that Car Rental companies had constructed a model where they bought new cars, rented them for a couple of years, and then resold them. The car would depreciate of course but as a bulk car buyer they got the cars at a discount on dealer cost because, well they bought more than the average dealer did. So when they depreciated they didn't lose as much value as you and I might experience if we bought a car, held it for two years, and resold it to a dealer (worst case) or another buyer (best case).
So the rental agency simply tracked how much the car would "lose" in value over its working lifetime, plus the cost of needed maintenance (generally relatively low), and offset that with income of renting it out. So the math was something like (making up numbers here) $5,000 of depreciation loss against say 400 rental days at $50/day or $20,000 of rental income. Say $1000 for maintenance during those 2 years and you've got $14,000 of "gross income" into the company, per car to pay employees and operating costs etc.
Now this makes sense and it is a fine business model, but an interesting quirk is that revenue is directly proportional to the number of 'working' cars you have out there bringing in the bucks. More cars, more income. And if you buy the car on credit there is an interest expense sure but you don't use up working capital to bulk up your fleet and boost your income.
As a result, car rental companies were carrying a HUGE amount of debt pre-pandemic which was all in car investments.
Then BOOM, the black swan of a pandemic hit and air travel stopped for all intents and purposes and now rental car companies are sitting on fleets of cars where they have to make the monthly payment on the debt but those cars aren't earning any income. This burns money in a hurry! So they did the only thing they could do, and sold off their fleets for the most part so that they could retire all that debt. Some, like Hertz, were already in Chapter 11 bankruptcy when they did that. Late 2020 was an excellent time to buy a car from one of the rental companies because they were really motivated to get them off their balance sheets.
And this then is the fun part. So the pandemic also put a huge blip in the supply chain. And since every single car company had switched to "just in time" manufacturing where they don't stock parts to make cars, they expect a smooth flow of those parts from the supply chain to feed their assembly lines, had to stop making cars. They had no parts. What is more, the humans in the pipeline like truck drivers, container crane operators, container ship crews, freight forwarding staff, Etc. were quarantining or not working because of the pandemic risk and those are jobs you cannot do "remotely" no matter how much you might want to. So the supply of new cars dried up, and won't untwist until the entire chain is back up and running at capacity again.
So now the pandemic is "less scary" because smart people have vaccinated themselves and they start traveling again. And those people want to rent cars. Which is great for rental car companies, except they cannot rebuild their fleets because there aren't any cars to buy.
And this adds the second fun twist, if you bought a car new in 2019 (as I did), and it is the kind of car rental companies might rent (which mine is), you get letters from the dealer in 2021 offering to buy it back from you for more than you paid for it!
What is more, when you see all those cars that are going to be 'totalled' by the insurance company because they were under water in the southern part of the US or on the east coast, those cars used to be sold for pennies on the dollar in "salvage sales" in which salvage dealers would recover parts and/or do enough repairs to resell them with a salvage title. The bidding for those cars is much more intense given the demand by rental car companies for stock, any stock, to boost their fleets.
It is a remarkable example of a system where the parts are interconnected in non-obvious ways that has a non-intuitive response to shocks to the system. As with most "emergent" systems like this one though, sending a shock through it does two things; it illuminates these previously unseen inter dependencies, and it tends to kill off weak players.
Imagine if all those grains stayed on their fields, it would trigger both parasites to develop where those fields are, corrupting entire valleys for years, while not either being able to feed the people they were aimed for. Which is the food equivalent of your car example.
If anything, the Covid proved to me that the world is much less oiled and tuned for some constant economic circuits than I feared. It is in fact quite reliable, if we don’t mention the debt we’ve put our children in.
Unfortunately, I didn't find out about it until too late. Which is unfortunate; that could have been the perfect opportunity to create a baked potato delivery startup. I would have called it "Tuber".
I don't have any brilliant solutions to bring about the Roddenbury-style economy, but it is infuriating to look at a scale problem you describe and trace the major causes back to the money. Are the cars going to vanish if the debts aren't paid for a year? Are the physical Hertz buildings going to crumble if the banks aren't satisfied? No, currency changing hands has nothing do with reality passively changing shape! And here we are, watching people sell off rental car fleets because assets will be seized unless the money changes hands in the right way.
They sold their fleets because other people (the buyers) wanted them more, in the short term. Now they want to buy because they want a fleet again. It's a time horizon problem, or perhaps an uncertainty problem - how were they supposed to know how long the pandemic would last? Or perhaps a premature optimization problem because the business was predicated on a pandemic not happening. But I don't see it as a money problem, any more than a tcp/ip problem.
Another commentator downthread mentions the fragility vs efficiency tradeoff, and that's certainly something encouraged by financializing the economy. By making it possible to easily switch between stocks and flows (capital/income in this case pay in full / pay debt) and encouraging whatever makes firms look good in the short term, the financial system helps cause this kind of thing.
We get towers built higher but not necessarily safer.
Which is great, when things fit the model (the stocks or bonds involved pay retirees longer, make people wealthier, etc), but also allow people to build much higher castles of cards than they previously could have before something toppled them over.
Panics, crashes, defaulting on debt, etc. have been around as long (and probably longer) than we have historical records, but wow does the modern system take the cake for scale!
https://www.youtube.com/watch?v=xkQn56Dtslk
I think quacked's point was that sometimes it's not a very good signaling system. Neither is TCP/IP in some cases, and sometimes neither are cytokines (to use a biology example). These are all evolved systems, to some degree; maybe they're the best we can hope for, but we should still keep an eye out for "version 2.0".
It is insane to me that we all have to shrug and admit that "well, we can't fix X problem because the money's not there" over and over again, when we have all of the labor hours and intellectual capital to do whatever we want as a collective species organism. With the right coordination, we could make every city look like a Miyazaki lake town. Or Disneyland. Or an exact copy of ancient Rome. We could scan every person alive every year and see whether or not they've got cancer. We could clean every river and every lake. We could send everyone a Nintendo Switch. That whole "bullshit jobs" memo gets circulated on HN all the time; how much of us could do actually cool shit if we didn't have to worry about paying for other people to help maintain society for us? I don't know, but it sure is frustrating watching Hertz sell off their fleet because their board is more worried about its share price than it is about whether or not Hertz, a car rental company, can rent out cars. (And I'm not blaming them for it- they're deadlocked in the same standoff everyone else is.)
More like worried about bankruptcy and going out of business.
One of my research interests is trying to make a contribution to what you call version 2.0, through better measures of subjective wellbeing.
If you're a rental company, looking at ~$0 income for the next year, and the need to pay for, maintain, and garage their car fleets, then you're top priority is to shore up the balance sheet and keep your corp afloat. What the car buyer's market will be in 18mo is a more distant concern.
Selling your only operating assets just because they're not operating at the moment seems pretty short sighted.
Creditors may have forced their hand a degree, but to me it feels like a factory selling their machinery because demand is down this year.
If you're going to sell all your cars as a rental company, might as well liquidate your whole company and close up shop.
Over-indebted companies is a very Anglo (US/UK) and Japanese thing. There are plenty of companies in continental Europe (Germany, Italy, France) who operate with much less debt than their US counterparts. A good example is Aldi. They have no debt on their balance sheet anywhere, not even for inventory. By the standards of American business culture, that is 100% absurd.
I'm really not sure who's right. It's optimization vs survival.
Sure the pandemic messed them up, but that was really a once in a generation at most event. If thats what it took to sink your businessz I wouldn't call it very fragile.
I also think they and their creditors made poor decisions.
Selling your only operating assets in order to balance the books is a suicidal move no matter the industry. It's selling off your only way of making money. It's like a software engineer selling their workstation when times are tough.
Dying now and cashing out is better than burning money for a few years and cashing out for less then.
They paid down their debt on the cars, but they have lots of other financial obligations and operating costs that will be ongoing if they continue to operate, and they now have a hugely diminished capacity to make revenue.
I'm honestly curious to find out whether most of us will even still be driving cars powered by fossil fuels by the time the next pandemic hits - as tech goes, it's only been around for a few generations. People will find other transit solutions if cars themselves get phased out. Or maybe we'll still have 'cars' with something dramatically different going on under the hood that car owners of today would barely recognize.
Firstly, Aldi is a private company (actually two entirely separate private companies, ALDI Nord and ALDI Süd, who share the brand name). So AFAIK they do not publish annual financial reports like a public company would be required to do. So how do you know there's no debt on their balance sheet?
Companies House filings for ALDI Süd's UK subsidiary, ALDI Stores Limited, do show debts and interest expenses so it's certainly not correct to say they "have no debt on their balance sheet anywhere"[1]
Resiliency against interruptions costs a lot of money: warehouses to store parts, logistics to rotate these parts, paying suppliers for these parts earlier than the parts are needed, waiting until you have enough cash to buy stuff outright...
The core point is: governments, businesses and individuals have historically always had these costs - but at least the Western world has been enjoying a couple decades without major interruptions like war on the home territory, oil crises or the looming threat of the Cold War getting hot (and causing interruptions as a result), which means everyone got incredibly complacent. After all, when there are no interruptions to expect in the near term, why spend cash in the near term to guard against them?
And so, when Corona hit, everyone got hit.
> Are the physical Hertz buildings going to crumble if the banks aren't satisfied? No, currency changing hands has nothing do with reality passively changing shape!
The existing buildings may not go crumbling, but planned/under-construction buildings are getting put on hold when the banks' income stream vanishes and as a result of that, in turn, the workers can't work, ... <insert recursive ripple effects here>.
In a theoretical closed-loop 3-person model, the farmer grows, the doctor treats, and the builder builds. The farmer can feed the other two, the doctor can treat the other two, and the builder can build for the other two, and in a micro-community they don't really need to pay each other. As we increase the number of people participating, the likelihood that each person would choose to work without being paid drops. That's why we see such degradation in economically affected areas; everyone could just work all day cleaning up, patching up buildings, etc. but they don't, because no one's paying them to do so.
I am not naive enough to believe that any amount of propaganda or state control could fix the money problem, but I am frustrated to be willing to participate in such a theoretical economy with no outlet for it besides helping people in whatever free time I have.
Keep in mind this isn't really a serious problem. Cars still exist, and can even still be rented, they just smell a bit. That's it. Smelly cars. First world problems!
No, but the retirees who depend on the income from bonds packaged from those debts will be screwed. Also, cars might not vanish but they do depreciate regardless of whether money exists. That's still a cost incurred by the rental company even though no money changes hands when it happens.
Ultimately the car companies were overleveraged and were forced to exit before their "positions" in cars became profitable. There's nothing short of the state propping you up that can solve that.
Even the Soviet Union had money and had to deal with economical realities. One of the reasons they collapsed was because of increasing grain production deficits causing an imbalance of trade. You can't legislate your way out of the market because the market's invisible hand will always show eventually, even if you can stave it off via state control of everything.
I'm not necessarily saying that I think money is a bug. It might be a feature. But the "market's invisible hand" relies on people being more motivated by their wealth stash than their behavior. If everyone chose to keep doing the same physical actions they're doing today except we stopped swapping money, nothing observable in reality would change; people would die at the same rate, food would be stored at the same rate, etc.
"The economy" is in reality a giant standoff where every member of the standoff would just stop maintaining society unless they get paid for it. The grocer could theoretically choose to continue to man the store 12 hours per day, and then the doctor could theoretically choose to treat the grocer when he gets sick, and the truck driver could theoretically choose to ship the medication from the plant to the hospital, and the floor worker could theoretically choose to...
Nobody has found a better way, though they often try.
> "The economy" is in reality a giant standoff where every member of the standoff would just stop maintaining society unless they get paid for it.
That's an immutable fact of human nature. Even cradle to grave propaganda doesn't change it. It's much better to swim with that current than against it.
This I agree with.
> That's an immutable fact of human nature. Even cradle to grave propaganda doesn't change it.
This I disagree with. Past societies saw far more social cohesion at points than our modern one. Especially on certain smaller scales, people were more willing to assist one another in the act of remaining alive without being compensated financially.
For instance- many people now think it would be unreasonable to help a friend move without some form of reward (money, food, etc.) This sort of value exchange for reward would be considered disrespectful in many past cultures and even some present cultures. Unwillingness to work without immediate reward not an immutable fact of human nature.
> Unwillingness to work without immediate reward not an immutable fact of human nature.
Yeah, it is, as no society has managed to make that work as an organizing principle. Even the Israeli kibbutzen have failed. Altruism rarely extends beyond family and close friends, and even then, it isn't reliable.
I’ve never thought about it this way before, and it’s a pretty profound quote.
Of course, if you're too cheap over too long a period, people may stop doing favors for you.
For example, we still don't know if the workers who build the pyramids were slaves or freemen. Kind of a big deal for that society.
One of the hard problems here is what to specialize in and to what extent. This is a hard problem to solve even in a static economy, and even harder if circumstances keep changing...
The "standoff" description seems to assume a static economy. If circumstances change, maybe we as a society need a grocer for only 4 hours a day but could use an extra half-shift truck driver. But how to discover that?
I do know that several things going on currently will make it more impossible to discover: increased financialization of commodities, outsourcing, destruction of culture via removal of differentiating markers, etc. If any society is going to discover the half-shift truck driver economy, they're going to be one that is almost entirely self-sustaining and committed to perpetuation of itself, not one that is leveraged up to the eyeballs, suffers from a total lack of manufacturing expertise within its component citizens, and relies on cheap foreign labor to make everything.
In the end, aren't all the money and ledgers are just a way to simplify the ridiculously complex trades required to make modern society work? We don't want to have to exchange sacks of rice and live chickens when we see the doctor and he doesn't want to have to get those chickens converted into barley or whatever it is the medical supply company owner wants this week.
If you remove this signal, you don't just remove a threat of stagnation. You also remove efficiency signals to curtail under-valued work. Just as easily, the participants could do other absurd things instead. The grocer could keep performing shelf-stocking actions while the shelves and back storage area are empty. The doctor could decide they prefer to drive around in an empty delivery truck, while the truck driver decides to sit in the clinic and talk to patients about the weather. Etc.
I'd argue that the typical diffuse ownership structures you find in most consumer-facing businesses today has the same effect, if not as absolute. The people who see the economic signals and they people with on-the-ground knowledge are split up: a sort of business logic hemispherectomy.
“Only money that goes out of date like a newspaper, rots like potatoes, rusts like iron, evaporates like ether, is capable of standing the test as an instrument for the exchange of potatoes, newspapers, iron and ether. For such money is not preferred to goods either by the purchaser or the seller. We then part with our goods for money only because we need the money as a means of exchange, not because we expect an advantage from possession of the money. So we must make money worse as a commodity if we wish to make it better as a medium of exchange." — Silvio Gesell, “The Natural Economic Order”
This describes inflation, in so many words. That's why central banks targeting a low level inflation is an excellent idea - it makes people spend money, rather than save. Spending can include investment to stave off inflation's effects - which, in turn, makes for increases in productivity over all.
>not necessarily saying that I think money is a bug. It might be a feature.
Yup, looks to me like the problem is not the existence of money, rather its nonexistence.
Financial problems don't actually occur when there is no lack of money.
I agree that retirees are wholly dependent on others to work for them and therefore I recognize their right to save for retirement. However, if your investment/savings turn out to be worthless then that is on you. It's better to signal these failures as soon as possible so that people are aware of the risk.
Think about it this way. You acquire "healthcare coupons" during your working age and then all the businesses accepting "healthcare coupons" have shut down. The coupons are worthless. Yet when you replace "healthcare coupons" with money, people insist that even if there aren't enough workers to work in healthcare, that money must maintain its value and they should even be owed more than they saved even though there is nobody to provide those services. This is why inflation is a necessary evil. It tells you what's really going on in the world. People will present inflation as theft but the truth is that your money is losing its value because it should be losing its value.
Just because e.g. gold is free of inflation doesn't mean that there will be healthcare services waiting at the start of your retirement to accept that gold. It's just pure speculation.
Following pieces of paper down to their very letter will make people abandon perfectly fine businesses. A lot of profitable businesses would have to shut down if they had to pay extortionate interest rates.
Positive interest rates simply reward short term thinking. Let's imagine a hypothetical scenario where interest rates are 5% (don't confuse this with the federal funds rate) across the board but it's only the rental car companies that have been hit by covid. A bean counter would see that shutting down the rental car company and using the capital for something else would be a better idea than to keep the rental car company. Next year everyone wants rental cars and the returns increase above 5%.
The point is that we make decisions in the present yet most of the money is going to be earned in the future. What we need is patience and patience means low interest rates, as close to zero as possible and maybe negative if we want 0% inflation.
A pandemic is not a black swan. Just like Earth quakes are not black swans. There is a Center for Disease Control for fighting pandemics.
We built fragile but efficient (for profit optimization) systems that had a good run. People plan for and about pandemics or at least pretended to, when needed grants.
edit: Black Swans are very very low probable events. Pandemics have been around in human history enough times.
edit2: Here is Taleb on cnbc...pandemic and blackswan.
The pandemic has gone on for far longer than it really needed to due to the politicization of safety measures. Several countries were able to nearly beat back the pandemic rather early, but the US is currently sitting in a third or fourth wave due to asinine behaviors of a few state governments.
Yes, a pandemic itself isn't black swan, but just how badly this was fumbled sure seems like it is (at least I damn well hope the next one isn't so badly managed).
That said, I'm in the US and not well equipped to speak to their responses, having not experienced them first hand.
Maybe it was luck, a sparse population or of course the often repeated ‘everyone always does what they’re told’ (hmmm). Also it started off well but things have become quite fragmented recently (different agencies issuing rules about different things at different times, in different regions, much to the dismay of anyone trying to plan anything). In short, whilst interesting, there’s not really any useful comparison that you can make between the US and Finland in my opinion.
Subjectively after living in both Helsinki and London it feels like Helsinki is even less crowded. I would say that there are fewer people who commute in to commercial areas from outside of the city than in London, and the commercial areas such as offices are generally a lot less dense, newer, and more spread out.
[1] https://www.hel.fi/hel2/tietokeskus/julkaisut/pdf/19_06_14_H... [2] https://www.ons.gov.uk/peoplepopulationandcommunity/populati...
It will be, and that not being obvious is exactly the problem we have today with our policies.
The pandemic is a worldwide phenomenon, to think it could have gone any other way is incredibly naive.
To say the pandemic was extended by politics around safety measures is missing several larger reasons covid became endemic.
e.g. local politics is largely irrelevant when the us never instituted forced quarantine for international travel.
Every attempt at curtailing the spread was rolled back or defeated specifically due to politics at the highest levels of the US Gov't, from not implementing travel bans as appropriate to blocking masking mandates, to state level gov'ts re-opening economies and lifting lockdowns during surges. The current hot-spots in the US are almost perfectly aligned on US political boundaries.
Even now it continues as masking and vaccination continues to be politicized with one side spreading obviously unfounded FUD around the vaccine and inflammatory messaging that masking children is "child abuse".
It would have required massive, and likely unsuccessful mobilization to lock down travel (both foreign and domestic) enough to actually control Covid aka New Zealand. Considering the land borders and smuggling problems there alone, I think it would have been ultimately futile.
Considering how politically fragmented the country was and still is even before the pandemic, trying it somewhat successfully may also have kicked off a Civil war - not that anyone would have tried that hard.
Vaccination rollouts could definitely have gone smoother, and better programs to manage the rollouts would have also been really nice - but given the situation above, it would only have been a (short) while before Delta or something like it got going anyway and started spreading.
Fewer would have died from COVID probably, but overall deaths may have been similar (more violence during riots? More shooting and civil unrest), and the fear and other issues (socio political strife for instance) would still have happened, just looked different probably. These types of situations are brutally hard.
Overall, I’d give the US a solid ‘C’ grade. Not great, not terrible.
Trying to blame a global phenomenon on the politics of one country with less than 5% of the world’s population is extremely parochial.
Systems built without taking the Pandemic risk into account are the issue here, Pandemic itself we know it was coming.. we also have movies about them.
Also, what pandemics had multiple vaccines delivered in record time? Ones that worked better than was ever hoped for. Even with that, which was the end goal, society seems unable to move on.
His articles overlap heavily with top posts on HN. This week he wrote about App Annie.
What is more, when you see all those cars that are going to be 'totalled' by the insurance company because they were under water in the southern part of the US or on the east coast, those cars used to be sold for pennies on the dollar in "salvage sales" in which salvage dealers would recover parts and/or do enough repairs to resell them with a salvage title. The bidding for those cars is much more intense given the demand by rental car companies for stock, any stock, to boost their fleets.
Well, the thing about flood-cars is they can look and drive fine but really merit being called totalled - having been submerged makes corrosion inevitable in a much quicker time frame. All of the electrical parts will go bad in X time frame.
Maybe these can be kept going long enough to bring value to companies but it seems like you'll have a lot more car renters on the side of the road than normal.
"Water can ruin electronics, lubricants, and mechanical systems. It may take months or years, but corrosion can find its way to the car's vital electronics, including airbag controllers."
https://www.consumerreports.org/buying-a-car/beware-the-floo...
That said, not looking forward to having to rent a car and dealing with mold or more frequent breakdowns on the side of the road!
Every car from a dealership these days comes with a CarFax and these have become mostly useless as a buying tool ever since they became a car sales tool. However, they do often give you some insight into where a car has been via registration and title changes.
I keep a record of recent hurricanes and where reports of flooding happened. If I'm looking at a car, the first thing I want to look at is the CarFax to see if it's ever been out of state so that I can cross-reference it to my hurricane/flooding list. If there is any indication that the car might have been in the same state at the time that a flood happened, it's an immediate hard pass. Doesn't matter if there's no visible evidence of being a flood car, doesn't matter if the title is green. Some outfits are very good at cleaning up flood cars to look close enough to normal that the average joe can't tell the difference. All flood cars are supposed to get a salvage title but a lot of them slip through the cracks. It doesn't take a lot of searching to find anecdotes from burned buyers online.
I have passed on several cars that looked like great deals but came from flood zones and possibly passed through the hands of a few unscrupulous auctions, mechanics, and dealers on their way to my region.
For the reliable cars like Honda Civics and in-demand ones the 1st year depreciation wasn't actually all that much compared to buying it new with a good dealer discount, urban legends notwithstanding.
https://www.autolist.com/honda-odyssey/honda-odyssey-generat...
Is there any real difference besides the fact that you can order it online and that it appears much more expensive?
For example instead of selling a car, selling a license to use the car to the first owner and then deactivating features or throttling performance if/when they resell the car.
Ford does something similar but is easily defeated by changing the stereo. The APIM tracks your driving habits locations and ecu vars which is captured and uploaded to Ford when you take the car in for service (don’t know how this works in their newer 2019+ cars since they are also connected 24/7 like GM)
I'm due for an upgrade, but if my choice is between a full price $40K new sedan or a 3 year old one for $38K (instead of the $26K I'd expect to pay a few years ago), then I'm more than content to just keep my ten year old Acura, knowing I'll need to spend $500/yr on repairs as it starts showing its age.
The ACC is a bit spiky. Could use some easing. But with everything on it’s not too bad in rush hour traffic when I don’t feel like taking the motorcycle out. Feet on the floor and it takes care of everything.
Looking at cars now I’m seeing 2109 LX’s with 30K mikes selling for $26-28K it’s crazy.
They focus on and serve a few niche markets, so some models are always in tight supply and rarely have incentives.
It is not that bad as of 5 years ago. You can email various dealerships and ask them to contact you if they are willing to sell at $x. If you are more desperate, you can ask them to email you their best offer. I was in and out in about 2 hours, just filled out forms based on what was discussed in the email and browsed on my phone in the meantime.
You can even see the inventory online at the car brands' websites. Although that may have changed in the last 18 months due to extreme imbalance in supply and demand.
I have only bought 2 cars in my life, the same way, so my data set is not extensive. But I did get the idea from reading about it on forums, so I presume others are getting it done the same way.
Actually, Costco has a program where the total out the door car price is set and non negotiable and I would assume the dealer would not want to screw you as that could cause you to report them to Costco and then Costco to sever ties with them.
What I did is start at the Costco price and email a bunch of dealers and let them know I am interested if anyone wants to beat that price.
Of course, this may have changed due to recent circumstances.
Several dealers seemed to know the type of customer they were dealing with, and for the most part, played things straight.
A month or two later when I was reviewing my account on the credit company's site, I discovered some sort of financing charge for $1500. I have no idea how they managed to slip it in - maybe I could have got it removed if I complained. But at that point, the sale was made and the creditor would blame the dealer, the dealer would blame the creditor, and it wasn't worth the fight.
They just cannot be trusted - it's inherent in their business model and how the various teams (sales, financing, etc) all earn their commissions.
I'm sure I did "agree to it"... on page 18, paragraph 3, subsection 4 - right there in the 6pt font where it states I understand I'm liable for applicable dealer-financing surcharges, etc. which can be applied at some later date.
Or… just by a Tesla. I hate that I am a fanboy, but I am. Great sales process, great car.
Could be a good business idea if this doesn't exist in the US
Cars made in the last 2 decades by most manufacturers tend to be very reliable, even well past the 200k miles mark.
As for maintenance, just find a trustworthy Indy mechanic and never go back to a dealer again. Compared to family that always leases a new car, there really isn't much difference in repair downtime. New cars tend to have a lot of bugs to work out that have already been addressed in a well used car.
I don't understand - I've crossed state lines in the US in a car and never had to inform anyone.
Same if you take the car for service to a shop in New Jersey; if the shop participates with CarFax then the record will include 'oil change and tire rotation @ (shop name), NJ w/ 3,300 miles' or something roughly along those lines.
Also, if you can’t deal with the “pain” of buying a new car every few years you must find a lot of things really painful.
Anecdotally: bought a 2004 bmw from the original owner with 123k miles in 6 years. 7 years later. 185k miles, original clutch. (I'm also a mostly highway miles driver, but this also includes track days)
Buying cars sucks and is entirely why Carvana and Carmax exist.
Most people leasing cars do it for fashion reasons, so they are normally getting rid of the car to upgrade to the next shiny thing, not due to problems.
Most people sell their new cars due to an expiring warranty period. Second most people sell their new cars due to the needs of a growing family. The third most people sell their new cars due to a changed financial situation. The fourth most people sell their new cars because they want even newer cars.
'Build quality dissatisfaction and reliability' is the fifth most common reason to sell a new car; or rather, to introduce a single-owner car to the used car market.
I had a JD Power infographic from ~2013 that listed the reasons, but am having trouble finding it.
Unless things have changed since 2013 signifigantly, most used cars that just exitted the factory warranty -- and sometimes factory maintenance umbrella -- have a lot of life left in them.
Aside from that, a car that is a few years older has a significant price advantage on parts -- a feature that is attractive to capable DIYers and mechanics.
And further aside from that -- if you're in the market for a used luxury brand car (Lexus/Infiniti/BMW/Audi/Mercedes/Porsche/ETC) , buying used allows one to side-step the dealer imposed major dealer-markup fees.
Example : the E92 M3 MSRP from from 2009 was about 70,900~ USD. The dealership markup in North Hollywood was 30.5k. In 2010 that same car was worth ~67,000 USD on the used market.
Many of these cars had less than 20,000 miles at the time of sale; buying a card with mileage that low is worth a 35,000 dollar discount to many people.
It's interesting how people talk about "depreciation" of an item that pretty much never, if ever, increases in value.
It is a very useful concept.
For example for a few years Chevrolet Silverados were made with "cat eye" headlights. Those trucks hold their value far more than chevys with rectangle headlights, all other variables being equal.
For example, let's say the new car is $50,000. I wait until it's $42,000 or whatever, buy it, keep it for 2-3 years, and sell it for say $37,000. I've done that 4 times now. I don't understand the business model of Car Max, to be honest. There seems to be a lot of people who believe used cars are good deals, I guess.
I'm in this situation and it's getting strange if your car is leased. Carvana and the like were offering me thousands more than the buyout amount. Like $5,000 at one point.
But now the automakers and their banks are shutting off 3rd party purchases, meaning the only parties that can buy the car off the lease are you and the dealer. And the dealer has no car on-hand to replace the one you plan to sell back, or if they do they want thousands over MSRP because that's what the market is bearing. So it's a wash.
One consensus is that Carvana/Vroom/Shift are buying cars at a loss to try and capture market share. Carmax has more of a track record so they might be getting a better shake like your experience. It could also be you calling personally that unlocked the lien, where the other companies don't work that way.
Some manufacturers like Volvo aren't letting you out of the lease early unless you're leasing another Volvo.
They absolutely are. Where I live, these companies are (and have been before COVID) paying well above market rates for newer used cars from private sellers. On the flip side, all of your typical auto sales rags and sites that used to have listings from private sellers and used car dealerships are now mainly carvana listings.
When you read the fine print, the residual value only applies to the owner. The bank can charge whatever it wants to everyone else, or deny the purchase altogether.
It got so bad that one of the engineers on his own dime stocked his desk with resistors and other small parts.
Madness.
Part of the problem stemmed from rating employees on how successful they were at JIT inventory. You get what you rank for, not what makes sense.
It doesn't make a lot of sense, and sadly there is no equivalent of "recovering court costs" from the people who exploited the law to shut you down.
The lead times are absolutely horrific though. And I do worry that fast PC parts (specifically GPUs) may be this price for a while.
In the short run, a lot of leverage makes sense, it helps you get a leg up, but if there's a Black Swan, then you're out.
It's a tricky thing because when a business fundamentally depends on those factors and it's hard to differentiate otherwise, well, it's just not fun. You're playing with fate instead of 'going things better'.
I wish they would innovate harder and make things more streamlined and easier. Renting a car is still a bit of a pain, the Car2Go model was nice, but they left my county sadly.
Its probable to me that no steady state exists - that in between each black swan event, given sufficient spacing, the companies that most highly leverage their financials/JIT pipeline will out compete the ones that behave more "rationally" in the interstitial period. The higher coefficient on the exponent just wins (growth maximizing into an empty market) even if it kills every company that does it.
Rough estimates of course, but only 15% utilization (30%*50%) would radically change daily rental prices. Doubt it’s the only reason, but wouldn’t be surprised if it’s factor
Usually you sit in a busy room. They call everyone one at a time - because there's a constant stream of people dropping off cars and picking up cars. For the most part, I'd say a car never sat more than an hour between being dropped off, getting cleaned, and being handed off to a new renter.
That has held true every. single. time. I've rented a car. And that goes back as long as I can remember, to when my parents rented cars 20 years ago lol.
"When the tide goes out, you then see who has been swimming naked.".
It's insane!
The crunch has abated some, though, and it was only for a short period of time you could get offers like that, but still!
> smart people have vaccinated themselves and they start traveling again. And those people want to rent cars.
Note that this is a very American thing though, because international travel is still banned, which means that Americans are forced to travel domestically, and when Americans go on a holiday, they rent a car, because you rent a car, because you have to have a car, and the idea of not renting a car when on holiday is completely alien to Americans. Normally, most of them would go abroad, and rent cars there, while the domestic car rental market would target non-American tourists, who rent cars less, so there's an even bigger demand for rental cars now than it would be if tourist patterns were back to normal.
When I go on holiday in a European city I wouldn't normally rent a car (unless the holiday involved travel to somewhere outside of the city). But when I go on holiday in an American city then of course you rent a car because it's a hassle to try and get around without one and you're going to miss out on a lot of the "American cultural experience" without a car. (Exceptions: NYC, and perhaps Las Vegas)
So it has a lot more to do with the nature of the destination than the nature of the traveller, I'd say.
I really enjoyed the use of "untwist" here. It's a metaphor that helped me visualize everything that was happening really well.
there aren't any cars to buy.
A while back I heard there’s one more piece to the arithmetic: the depreciation expense lowers net income so the rental company is able to proportionally lower taxes this way as well.
I still hate car ownership: the parking fees, maintenance, shocking price of gas, insurance, etc. It's costing me $20/day to sit mostly in a garage. I was saving up for a BEV. But realized air travel is out of commission and a BEV might not be practical for road trip vacations, at least not right now.
Smaller apartments in dense, walkable neighborhoods have been pretty miserable places to live for over a year now.
The bargain was that you don’t need a house with a yard when you can have an apartment surrounded by parks, restaurants, and bars; that you don’t need a car when you have transit; that you don’t need a home office…
Then all of that was taken away in a heartbeat with little regard to its effectiveness. Suddenly owning a house and a car were critically important again. It’s going to take a long time for people to come back.
Oh yeah, and we completely f’d over our kids. Like, shamefully so.
History will harshly judge the people who pushed these public policies.
Because I don’t think that such a thing promotes healthy, much needed dialog. The idea that any criticism or skepticism of the core tenants of the last year and a half of public policy is misinformed ramblings of crazy people…
Whereas you're asserting that it's impossible for smart people to spread disinformation?
[0] https://www.dailynews.com/2020/04/28/california-doctors-with...
You can see effectiveness of response based on various states and regions that responded differently.
https://www.covidchartsquiz.com/
Nope, the restrictions really didn’t do anything at all.
Just two basic things the charts don't consider:
1. If people followed mask mandates in states (e.g. Alabama vs Florida)
2. Population density and disease spread models (e.g. comparing Montana and Idaho felt like a reach, California vs Nevada doesn't consider spread in major cities vs how many major cities there are in each)
We absolutely should study this later, but some of these restrictions were little to no cost. Let's not lump them all together. Wearing a mask indoors vs if your kid can go to school or not are two very different value equations that may merit different answers of "if a restriction is worth it"
The media does its very best to blow everything out of proportion for ratings. COVID is no exception. What a win for big pharma. 640,000,000 doses of a drug they can't be sued for. It's absolutely fantastic for them.
Now look at who they bribe.
It's been an incredibly good couple of years for our oligarchy.
You had no idea about the preventable medical errors killing 400K people a year did you?
As a thought experiment, what if the pandemic mostly hurt 20-somethings? Would our old leaders stop everything to prevent transmission of that disease? Or would young people be told to suck it up? Or would they have asked 20-somethings to just stay home while everyone else went about their business? I'm not sure...
(AIDS was originally attributed to only gays and sexually promiscuous people. Best case, leadership simply ignored it. Worst case, innocent victims were attacked [read the Wikipedia article for "Ryan Wayne White"].)
There's also some clips of him warning people not to have casual contact with gays (he says people with AIDS).
This happened [1]. They told young people to go ** themselves. People had school, people went to eat, people carried on with jobs, NO government checks sent out. Deaths: 50 million worldwide with about 675,000 occurring in the United States.
"Mortality was high in people younger than 5 years old, 20-40 years old"
https://www.cdc.gov/flu/pandemic-resources/1918-pandemic-h1n...
Care to elaborate?
Outside of the current pandemic, those problems range from the rent-seeking consolidation of housing ownership into very few hands, to the elimination of forms of self-reliance that create healthy community — instead shifting those responsibilities to government and large institutions.
Scale also requires more top-down centralized control and regulation in order to function at all.
Now that is a spectrum and we are all dependent on others but they are at the high end. The low end is "compound in the middle of the wilderness which is dependent indirectly for there to be wilderness unused for them to DYI everything".
The issue will hopefully wind up rare but there is no great certainty in these matters.
City urbanism might be the most resource-efficient in many ways, but animal well-being isn’t measured solely in terms of how efficiently we can feed and house you.
If it were, factory farms would be the ideal.
For my goddaughter, killing ants is the top of all evils. Ecology should be able protecting cute things. For me, terraforming kilometers of arable land to build her colonies on Earth, that was the real crime. Cities bring the illusion that humans are legitimate in unfathomable numbers. Cities hide away nature’s constraints.
Beyond that, rural and suburban services are very heavily subsidized by federal and state grants, most of which comes from urban areas.
I would say that urban living in North America has two fatal flaws:
1. Housing prices (and other cost of living)
2. Incorrect city design based on cars.
High prices, especially for housing, increase the number of homeless and desperate people. This increases crime by a lot.
Car-centric design makes moving about a dense area very tedious for everyone, including car drivers. Urban design ought to be more centered on people throughout, which means pedestrians, bicyclists, and public transit are treated with more priority than cars. Every city in North America is designed the complete opposite. Not only that, but cars are very noisy and dirty compared to other modes, making the urban area even worse.
At least the city design portion can have a huge benefit. A counterexample to your point is likely most cities in the Netherlands, like Amsterdam, which reportedly have very happy citizens and very people-centric design.
Plus, 83% of Americans choose (or need) to live in an urban area despite the flaws.
For more info on the financial aspect, this video and the others in the series are great: https://youtu.be/XfQUOHlAocY
This is simply false. Maintaining roads takes typically less than 10% of the budget of the municipality. Additionally, road construction and maintenance is significantly more time consuming and expensive in dense urban areas.
> On top of that, neighborhoods that are spread out require more people to drive cars, which not only increases the maintenance burden, but also requires loads of parking lots at grocery stores. And none of that grocery store parking lot is going to generate the tax income required to pay for the infrastructure needed to travel there.
Huh? The grocery store’s parking is part of grocery store, which generates tax income.
[1] https://usa.streetsblog.org/2015/03/05/sprawl-costs-the-publ...
Yes, ~80% of Americans live in "urban" areas, but the majority of those living in "urban" are living in "suburban" areas if you actually look closely. For most classifications its simply either urban or rural, not urban/suburban/rural.
In my neck of the woods (SE Florida) urbanism didn't lose a beat. Rental apartments in my neighborhood are leasing at above asking. There were a few months where the city felt abandoned, property values were down, and leases were offering signing bonuses.
It's done a 180, or 360 now, city property values are climbing. New construction is way up, even with the high cost of labor and material, and shops and bars are working with the new normal. My city has taken advantage of decreased traffic to institute popular pedestrian projects that were unpopular to commuters.
Anyone living near those areas had an improved walkable neighborhood.
Also I don’t think anyone living near a park lost use of those parks.
The numbers don't really bear this out. Rents are as high as ever and inventory is largely back to pre-covid in the major cities where the life you're describing exists.
* There is no bike parking available, so 2 bikes occupy a large portion of my living space * The sidewalks outside my apartment are small and in a state of disrepair * Intersections are cyclist and pedestrian hostile making it hard to go anywhere without it being a stressful experience * The landlord refuses to fix my A/C when it's 118 degrees farenheit outside, meaning it is often 92F inside the apartment (And no, citing the municipal code that says this illegal does nothing and nobody has the energy to hire a lawyer right now) * The bus stop has been in disrepair to the point where it was recently just removed altogether meaning I have to walk a mile to get to the next one. * The next nearest bus stop has no shade or place to sit * I can't mount my TV to the wall or make any changes to make the small space more comfortable (like hanging shelves or mounting hooks)
I want nothing more than effective urban living, but I have yet to see it. So from my perspective, I'm not sure what was really "lost" during the pandemic that wasn't already broken.
Also, since I see some replies mentioning it, I would rather my parents ad grandparents be alive than have any of the above be fixed. So I'd be careful to judge too harshly and gain some perspective about "strict" measures to curb the spread of the pandemic.
Unanchored furniture is extremely risky and kills infants every year.
Yeah, there's a risk that you might drill into a pipe. In the last 20 years that happened to me once, and it was annoying, since it cost 200€ to have the pipe fixed, but it's not really a big deal.
For what it’s worth, I’ve done this every place I lived and never had a problem. I always make sure to patch the holes and paint the entire wall when I move out though.
Living in a rainforest-like climate in Vancouver, I couldn't be happier. Ya, I could use a little more space than my studio. Ya, it sucked so bad when the pandemic hit, but much much less so than in suburban areas. I still only walk 2 mins to a bar or where I buy groceries. Transit is the same. Mountains aren't far etc.. To say urbanites have been set back decades is ridiculous.
That said, idk about living right downtown, but I've always hated it anyway because it's a boring landscape with boring people.
In other words, by my estimation the urban ideal continued to be advantageous for different reasons during the pandemic, though I can certainly picture other urban centers that would have been a much worse experience, in particular those with stricter mandates and poor weather (which is a truly isolating scenario).
Everyone should not own a car, it’s unsustainable both for the planet and for the road system.
Assuming gas prices were 10x (32.9$/gal), they'd be paying 200$ an hour just for gas.
Alright, this has gotten ridiculous. Anyway, higher gas prices would just drive alternative adoption, and that's good. I was just selfishly thinking of me having to drive my car with those prices ;)
The fact that so many people pay that cost and the inconveniences of maintenance and searching for parking space should motivate you to think about the utility of car ownership.
Where I live, public transportation is great. I don't think it can get much better, practically. Yet, I have several modes of transportation where I cannot use it: Traveling out of the big city or to orthogonally to the main public transportation routes, or with small kids, or with large luggage, with a week worth of shopping bags, or when I have to get rid of garbage...
What a big city needs is threefold:
* Slow, respectful, traffic (30kph should work) -except for some big roads- shared between all vehicles (bikes included)
* Zero-emission vehicles
* Enough parking spaces (that should cost money) for all vehicles.
In order to get there, we will have to reduce the amount of apartments per sqkm and even more so the amount of office space and shops. This will work in two ways: It will naturally reduce traffic and free space for car parks.
This sounds like prioritizing cars over people. What's the point?
The cars are used by people. If you prioritize for cars, you are prioritizing for those people.
Car ownership has a Prisoners' Dilemma payoff structure to its utility. It's very useful to the car owners, very harmful to society at large. As more and more people have cars, the population of car owners and society at large overlap a lot, meaning everyone is paying the costs.
Do you ever wonder why it's so hard to get around without a car? A lot of it is that the need for wide roads for cars, and the need for lots of parking force all of your built infrastructure to be physically spread out. Which means you no longer can get around without a car, which means you need more car infrastructure, which makes it harder to get around without a car...
Most things we take for granted like being able to get a week's worth of groceries home in one trip or going to enjoy a restaurant that specializes in a niche style, or buying cheap goods at a warehouse store, or being able to get to a hospital within half an hour all require automobile infrastructure. But once you have roads all over the place and parking lots at important destinations, and lots of people owning cars for these necessities, the damage is done, and car travel is the sensible mode for virtually all transportation.
The fact is taking a leisurely stroll on a nice spring morning when you want to is very different from being forced to walk for miles through freezing rain in November after a long day of hard work. You want the option to drive. There are lots of good ideas about how to make towns and cities both drivable and walkable. Anyone telling you that the simple existence of car infrastructure is the problem has not thought through what elimination of that infrastructure really means.
It's possible to do these things without a car if your city has prioritized making that a reality. The exact mode depends on the city. Some examples:
* In the Netherlands, cycling infrastructure is strong enough that you can bike to a big box store outside the city and load up your bike with what you need [0]. You can fit a week's worth of goods in a cargo bike [1] if that's your style. There is also an argument to be made that you don't need to buy groceries weekly if your city is dense and you have a store nearby.
* In Pittsburgh, there are flyer (fast track) busses that will take you to malls in the northern car-oriented suburbs as well as light rail to the southern suburbs. So you can reach most niche stores in the metro area by bus/light rail. Although it's pedestrian hostile in the northern burbs. In the city proper, bus coverage is good enough to get basically anywhere including all the niche restaurants. Though light rail is more frequent and pleasant. Bus frequency and reliability is just OK, not great. Could be improved by changing priorities. My point here is that Pittsburgh's urban form is not great but they still came up with transit solutions that work for average people.
* In Toronto, busses run every 10 minutes on an enormous number of routes. This reduces transfer times so much that travel time is nearly on parity with cars, even though the city is very car-oriented.
I don't understand your note about hospitals because ambulances get the right of way and can travel in bus lanes.
> The fact is taking a leisurely stroll on a nice spring morning when you want to is very different from being forced to walk for miles through freezing rain in November after a long day of hard work.
I agree, but it's not so bad in a dense urban area with adequate bus shelters, sidewalk clearing and bus lines scattered everywhere.
> Anyone telling you that the simple existence of car infrastructure is the problem has not thought through what elimination of that infrastructure really means.
The simple existence of car infrastructure is the problem because it causes sprawl and exacerbates our climate emergency. Cities have already come up with the solution and that is good transit, active transit included.
[0]: https://www.youtube.com/watch?v=M8F5hXqS-Ac
[1] https://www.bakfiets.nl/bestanden/afbeelding/2019/374-cargo-...
I think you are describing lots of places where walkability has been achieved while maintaining perfectly functional road networks.
> So what are these busses and ambulances driving on, exactly?
Roads. I never proposed getting rid of those! I want to get rid of parking which again, is a different discussion. But it is surely one informed by our original topic which was whether cars are required for daily life.
> I think you are describing lots of places where walkability has been achieved while maintaining perfectly functional road networks.
Of the three I listed, only The Netherlands fits that description. There are disincentives to owning a car there, like limits on parking spaces. I believe true walkability and livability is only achieved when we modify traffic signaling and road infrastructure to prefer pedestrians, transit, and bikes over personal vehicles. Or if space allows, provide completely separate road networks for the modes so there are no conflicts, with more direct routes given to transit, peds and bikes. We also need to remove parking. The Netherlands has done these things.
Pittsburgh and Toronto are not there yet. They are car-oriented cities with a transit system grafted on top. I'd be happy to go into more detail but we've outgrown the original topic of our discussion.
Sure, folks use cars mostly to move just their body around. But on the occasions its more than that, a bus or bike is a very different proposition, an order of magnitude more onerous than a car.
And btw using the Netherlands as a bicycle-nirvana doesn't translate. That's about the flattest nation on earth. Anywhere else, and hauling 200lbs of cargo is not the same joyful experience.
You can purchase the TV set off the internet and have it delivered to your door by post. Or you can apply for a "no parking" permit on the front of your building and have the big box store deliver it. The delivery charge is less than a monthly car insurance payment.
> or six bags of groceries
Like I said in the post you are replying to, you can buy groceries more frequently if you live in a dense city with stores nearby. Also in Pittsburgh you are totally allowed to bring six bags of groceries onto the bus, it is quite normal. You put them on the seat next you. There are corner cases where the bus is full and you can't but in the average case it works well.
> And they add an hour to the trip. That ice cream is going to be wasted.
I buy my groceries by bus or bike. I don't know how I'd run into this problem. Everywhere in my city there is a grocery store within a 1 to 1.5 mile (1.6 to 2.4 km) radius with bus access that takes up to 20 minutes to get there. If I ever had my ice cream melt, I would buy one of those thermal bags with the shiny inside to keep it cool. It is true that busses often have longer travel times due to stopping frequently. This delay can be reduced by giving signal priority to busses and by building bus lanes (right-of-way).
> Sure, folks use cars mostly to move just their body around. But on the occasions its more than that, a bus or bike is a very different proposition, an order of magnitude more onerous than a car.
Yeah, but cases where one truly can't use transport to accomplish the given task are infrequent enough that the average person can work around it using the solutions I mentioned and some extra planning.
> And btw using the Netherlands as a bicycle-nirvana doesn't translate. That's about the flattest nation on earth. Anywhere else, and hauling 200lbs of cargo is not the same joyful experience.
Yeah, cargo bikes are just one tool in the transportation toolbox. Bikes are still surprisingly useful even in a really hilly city. But for hauling stuff up hills, one could use a cargo e-bike. Like these: https://www.bicycling.com/bikes-gear/a25054215/best-cargo-bi...
I understand you plan to include bikes on the roads themselves. But making a city less dense and filling it with parking spaces for automobiles makes the city hostile to all except automobiles.
> * Zero-emission vehicles
Zero tailpipe emissions. EVs still emit 1/2 as much lifetime GHG as a combustion engine personal vehicle [0]. Your plan would make your theoretical town less walkable and bikeable and force former cyclists and pedestrians to drive EVs. This results in net higher emissions since more motor vehicles would be on the road.
> Traveling out of the big city or to orthogonally to the main public transportation routes, or with small kids, or with large luggage, with a week worth of shopping bags, or when I have to get rid of garbage...
These are valid use cases but they do not justify increasing a town's emissions in the middle of a climate crisis.
> In order to get there, we will have to reduce the amount of apartments per sqkm and even more so the amount of office space and shops. This will work in two ways: It will naturally reduce traffic and free space for car parks.
This would make the city less economically productive per sq km. Compare the tax revenue from 10 parking spaces in a parking lot versus mixed use row houses & businesses in the same lot. Plus people can actually live in the latter. Is there a housing shortage in your city? There sure is one in mine. And it has tons of tax subsidized parking :)
[0] point #4 in https://www.epa.gov/greenvehicles/electric-vehicle-myths
That's simply not true. I saw that working extremely well in downtown Vancouver nearly a decade ago. Parking can easily coexist with apartments and shopping and it can get the cars off the streets, increasing space for everyone.
> Zero tailpipe emissions.
Yes, because that's what a city needs to care about. Everything else is not city politics.
> Your plan would make your theoretical town less walkable and bikeable and force former cyclists and pedestrians to drive EVs.
That's simply not true. Offering enough parking decks (and, e.g., garages in apartment buildings) will remove parked cars from the streets. This gives space for slow bikes and pedestrians. Reducing the default speed will make live much better for fast bikes (I consider myself part of the latter group, btw. I speak out of experience).
> This would make the city less economically productive per sq km.
Since when is that suddenly an argument? First of all, taxes mostly go to the country, where I live. Second, the most economical mode if living would mean to move into some barracks close to the office, and third, transportation already plays a bigger role for local economy than density of living.
> Plus people can actually live in the latter. Is there a housing shortage in your city? There sure is one in mine.
I bet you are one of these people that buy the argument that building more roads leads to more congestion. Did it ever occur to you that building apartments could actually worsen the housing crisis?
Your proposal, to make cities walkable, inevitably increases the housing shortage and yields extremely dense quarters - something I would not consider livable at all. A city should have an upper limit of people per sqkm as it should have a minimum level of green and parks.
I'm guessing the EV is electric vehicle, but what's the B?
Which is really a poorly coined term because it's not as if plug-in hybrids, many of which can do people's daily commute back and forth without ever kicking the internal combustion engine on, where finding their energy from something else than an EV battery.
Now, post pandemic, the small grocery store downstairs closed, as did the cafe, and the restaurant is take-out only. The neighbourhood also suffered, with many lovely small businesses closing and crime becoming as rampant as it was a decade ago. The city also raised the bus fare ~20%. This was basically the perfect storm to drive me into a house rental, buy a cheap used car, and otherwise turn me into what I resented just a few years ago.
I think this is going to be a trend for many late-twenty-somethings in north america, the regression of optimistic urbanists to begrudged suburbanites.
You want bleak? Look at projections of what the planet will look like in 100 years if current trends continue.
I imagine the impact depends heavily on localized lockdown measures, and they apparently aren't nearly as strong in Dallas as wherever you live.
Taking a BEV on a road trip vacation is more tricky and requires more planning, but it's very doable. We've taken our 2017 340 mile (when new, current max range is about 327 miles) Tesla on a number of moderately long road trips. It's a bit slower and there are some places we could not have gone, but it definitely works.
Keep in mind that you can charge 3-5 miles per hour on nearly any standard 120 VAC outlet. With one of our trips to the mountains, we ran a 100 foot extension cord from our cabin and had little trouble keeping up with mileage demands.
More concretely, last year we moved from California to Washington state, a little more than 800 miles. Since it was in the middle of C19, we didn't want to stop over anywhere, so we had to do the drive in one day.
It took us about 16 hours to drive about 820 miles, an average of more than 50 miles per hour, including charge stops. 15-20 years ago we'd do 800 mile days in about 13 hours, or an average of 61 miles per hour.
The Tesla supercharger network is pretty extensive, extremely reliable and constantly growing. I don't have a sense of how widespread/reliable the other fast charging networks are, beyond various problematic stories I've come across.
PS: I've seen youtube videos of people doing 12-15 amp 120 VAC charging (gaining 3-5 mile per hour) in Teslas using portable solar panels too.
Uber and Lyft still sucking so hard into this year was the catalyst.
I wonder if shared rides through those apps will ever return.
Are you expecting to want a road trip in the next year that badly? Otherwise just rent, right?
FWIW - I rented a car in May and paid about $2000 for 4/5 days. I forget the specifics but the midsized economy class was only about 10% cheaper than a luxury SUV, so I upgraded. It was in Boston.
> A global microchip shortage that has cut production of new cars continues to deal a heavy blow to car rental companies
How is a car shortage an excuse for rental car agencies to act in this unacceptable manner?
If I reserve a specific kind of car, I expect that reserved car to be there. If there is a shortage, then do not make that particular car available on the booking portal.
This is like if you reserved a hotel room, and were put into a janitorial closet instead, with the excuse being that this was because of a wallpaper shortage. This is completely untenable conduct.
Let's look at an analogy with even just the same object. Let's say I run a car dealership. 9 times out of 10 you get the car that I told you you're going to get. But every tenth time, I just happen to be out of stock because I didn't predict that a market could have shortages and didn't plan accordingly. In that instance, I then give you a completely different car than the one you thought you were buying, oh and this one also happens to reek of vomit and smoke. This would not in a million years be acceptable.
Like the Wagon Queen Family Truckster? Damn fine automobile, beats the hell out of the sports wagon.
It has been a problem for a very long time.
Car rental customers are not going to pay 10x to get that extra 1% of guarantee, and you simply will not see that type of car rental business exist. It simply is not economical to build enough redundancy for the 1% of the time there is a problem.
Of course, it also is not economical to build enough redundancy for multi year pandemic situations.
Presumably the market is capable of coming close to the solution where people are willing to pay $x for a y% chance of having their needs meet, such that sufficient people will not pay $x+z to get a 100% chance of having their needs met.
It is not like it was an unknown issue, having even been in the plot of one of the episodes of one of the most popular television show of the 90s.
Even today, there are 3 car rental companies, Enterprise, Avis, and Hertz, and any one has the option of offering a 100% guarantee, but they do not.
Hotels do not either. And neither do airlines. You can get walked to another hotel, or bumped to another flight (assuming you are not a VIP of some kind).
Which tells me guaranteeing the last 1% (or whatever small percentage of people that cannot be accommodated) is too costly and customers would rather save money instead of pay for the redundancies needed.
Why not? Make a late return fee sufficiently high, and see if suddenly inventory control becomes a lot easier.
If you don't want to vacate your plane seat or your hotel room, you don't just get to say you'll pay for another night or another flight. Why then is this allowed practice for car rentals? The late return fee should be proportionately high so as to very strongly dissuade this kind of behavior.
Because the car is a physical object whose entire purpose is for you to take it far away from the rental office.
> The late return fee should be proportionately high
Are you sure you want to advocate for large corporations to add additional, punitive fees to consumers? One day you might need to return a car late, you know, if someone in your party gets sick or something.
They already do charge a lot extra, still, some people pay it. The other part is there is no fixed time where everything switches over. Hotels have a fixed check-out time for everybody, doesn't matter if you checked in at 3pm the or 11pm. Cars work on a 24-hour schedule, if you rented the car in the evening, you can keep it till the evening. Sometimes people return them early, if they have a flight to catch or whatever, some people keep the car as long as possible. Usually this is managed just fine, but sure, occasionally, demand exceeds supply and the car isn't immediately available. Flights get delayed too, sometimes, perhaps you've noticed.
The other day we were in a queue with ~20 families waiting for the cars they reserved, and it was clear none were available. Surely they didn't have that many late returns.
If there are some companies that do limit their reservations appropriately, I'd like to know their names please :)
Seems like it's not just me :) https://www.youtube.com/watch?v=4T2GmGSNvaM&t=39s
Airlines also overbook but at least they have reasonable limits based on data, and offer compensation for bumps.
Enterprise raised their already high prices even higher. Their fleet looks about the same as pre pandemic too.
Edit: and hertz aren’t content with their high prices, they also recently added a fake 15 minute offer expiry countdown on the booking page. Absolute scumbags.
A root cause of this problem is that the rental car companies sold off a lot of their fleets thinking that the pandemic would absolutely crater demand for >1 year.
Am I misunderstanding? Those cars went somewhere -- they didn't go into the dump. Wherever those cars went, why are they not causing some cushion / surplus in a different place that relieves some shortage? They got locked up in a warehouse and are inaccessible? Sold off and can't be bought back?
Reporters in their simplistic descriptions make it sound like those cars just evaporated.
So yeah, the root is back to the car companies. The rental car companies probably would have been dealing with a much smaller problem from the overall car demand increase from their sell-off if the car companies had maintained their production capacities of their supply chains.
See the cars at enterprisecarsales.com , where most of the cars are Enterprise Rentals.
Still better than the proverbial $500 Civic with 250,000 miles, 7 owners, and 3 accidents, but not great vehicles to own by any stretch of the imagination.
How many times one rents a car for personal use v/s on official use or business use? Business use is way higher than personal use. Most of the people who rent it for business use, are reporting to their boss or some kind of supervisor; & if they thrash car, car company reports/charges damages, it will come back to the person who drove it. So, no, a majority of renters don't beat cars because they still will be on hook for damages.
How many regular rentals need premium? None. Only exotic rentals might. Most of the rentals are run of the mill Toyota,Hyundai, Mitsubishi, mid size or mid range; the cars which are most of the time good for everyone. None of them needs premium. Although, this fuel thing exists. When I used to rent, I used to buy the cheapest fuel at any cheapest station. Now in own car,I go by only Shell Regular.
Rental are new, & new cars are covered bumper to bumper for about 36000, transmission till 60,000.
Yes, rental gets different drivers, but so do to some degree of non rental (family, friends, not common but still not zero).
So, as stated above,a 36,000 miles in a rental is not much different than same in a non rental.
In my opinion; there is a similar set of drivers who dont care for their own car, & almost most of them will not care for rental or friendly loaned too. People race their own cars, people floor their own cars.
My personal experience; my used car came with all shop visit records; verifiable, from Ford's system. Yes, it had about 4000 miles more than projected 7 years 150,000 miles on projected line, but that gap is getting less everyday with my moderate use (1000miles a month).
Rentals are beaten is a personal opinion. Any car can come out beaten. People who beat cars don't care if they rent it or own it. But beating a rental car might bite back quickly instead of beating one's own car.
> renters beat them up because they don't care
&
> beaters and sent those to the junk yard.
Still, all of the above also gets applied to owned cars too. People use cars for multiple people; people slam doors, majority of personal cars have no garage, small issues and negligence.
Newer cars (rentals or not) have factory warranty, where service center takes care of minor issues without even asking.
I respect your opinion that rentals are bad than owned cars, other things like mileage same; but my opinion & experience is, people will be bad drivers, be it their own car or rental; & even bad drivers will be a bit more careful with a rental because chances of them paying for it immediately financially is more than paying for damages to their own car.
I was an Enterprise rental customer for about 7 years before that, renting a car about 2-3 times, not preplanned; & decision based on rental cost & availability, flexible dates.
Other trims were also available.
My car is Ford EcoSport, Titanium 4WD. Highest. The 2nd trim was Titanium FWD. Then SE. Then the lowest basic trim, S.
All trim options were available, obviously as used cars with all having different color, prices.
This is the conventional wisdom, but is it actually true? Anytime I've rented a car, I've handled it like a virgin princess because I know any scuff is coming out of my hide. My own car, hell, rub it up against the concrete barrier for all I care. That is a vehicle I would not want to buy on the used market.
The cars with extensive damage or accidents, any bad mark on carfax goes to wholesale auctions. These are just the ones near end of mileage or age warranty.
The news, the hype, & the reality too contributed to the car sales. I am not in market, but still I see now the 2/3 year used car prices almost very near to their new counterpart, even on enterprise, compared to dealer websites for new cars.
And a in 1:1 private to rental car sale, the rental would be cheaper almost always.
>A former rental may cost less money up front, but it will also return less money down the road. Getting maximum resale value for a used rental car is difficult, because many shoppers are wary of buying former rental vehicles, so much so that some states have passed laws allowing car dealerships to call rental cars "program cars" in hopes of avoiding the stigma. https://www.cargurus.com/Cars/articles/the_pros_and_cons_of_...
First, almost all renters avoid abusing a rental car because they don't want to get charged for any damage. (Maybe the exception would be a sports car.)
Second, I mean, unless they took it out to the track and spent a day going laps with it, cars these days are basically built to easily handle any kind of driving behavior you can get away with on public roads.
What really kills cars are accidents and lack of maintenance. Neither are hard for a trained mechanic to detect.
What about constantly redlining the engine? That will put a disproportionate amount of wear on the engine for the miles driven, but won't cause any immediately-visible damage.
I personally do drive rentals to the max safe performance they will give me, which is more like what the description was about, in any case.
Revving in neutral is not particularly horrible for a car. Perhaps worse if done cold. The no load situation makes timing on the car easier.
Likely one tank of regular gasoline in a performance engine, and a stop and go to the neighborhood grocery will do more damage.
Redlining while parked or neutral is absurd. Who will rent car just to rev it up. & For how much time? Few minutes? Hours? People will be looking at this person who is redlining a car since last few hours.
Not even close to a consideration as long as the engine is getting scheduled fluid changes.
Source: used to be privy to some OEM testing info.
Also, a Dodge Neon can go 50 in 1st gear, or maybe it was 2nd, I forget.
https://www.usatoday.com/story/money/cars/2020/06/19/hertz-e...
Right now, I know of dealerships that are selling new cars for ABOVE MSRP. I have gotten a half dozen offers from my local dealership to buy back the used truck they sold me for more than they had sold it to me for.
What will the correction look like? It almost has to look like the price of cars crashing, doesn't it? It will start with new cars being overproduced, dropping in price, then used cars dropping.
2023 might be a good time to buy a car, if you can hold on until then...
I really hope this happens harder/faster than inflation just so we get a couple years free of morons on the internet screeching about how their 4Runner holds value.
Cars disappear over time (they age, get in accidents, etc.) Due to production issues, the replacement construction of cars has dropped dramatically. The rental companies decided to get rid of their buffer with the expectation they would not be used during the pandemic. (Plus, rental companies age out cars naturally)
However, given the limited new cars, they have not rebuilt their fleet as fast as possible.
Cars hit end of life, get wrecked, are destroyed by floods, etc.
Also, car rental companies sold their fleets into the market after new car manufacturers slashed production, so fewer new cars were going out the door.
The driveways of people who couldn't buy new cars because #ChipShortage.
Supply: - production curtailments (early COVID) - limited production (supply chain issues / chip shortage)
= demand exceeding supply
I'm renting another 16' truck for a move going south on the same route next week. The truck and insurance cost over $5000.
I looked at purchasing a box truck as an alternative to reduce the hit to my wallet. Box trucks cost around 2.5x what they did two years ago. I'm finding 10+ year old beat up GMC trucks going for over $100k.
a) Where the fuck are you looking? The heavy equipment section of CL in every major city is littered with 10-20yo 15-26ft box trucks for $5-16k depending on specs and condition.
b) Purchase price doesn't really matter that much if you are reselling it when you're done.
I booked a SUV with my Sapphire Preferred card that has primary car insurance on it but when I went to pick the car up, I had the sleaziest sales experience of my life.
The agent tried to sell me their insurance for $70/day but I told him, no I'm covered. He said due to COVID they have a new policy that any scratch, dent or chip, no matter how small, will be fixed and the cost deducted from my $1700 deposit.
I was ready to decline until he showed me the car I booked. It had so many scratches, dents and damage, including coffee stains on the headliner, that I gave in and took their insurance because I needed to leave that day. As we were taking pictures and documenting the myriad of damage, I realized I was going to be on the hook for something when I returned the car. He said they cash in 90% of deposits... I think that was a lie as well.
Lo and behold, once I took the insurance, I got "upgraded" to a nicer and cleaner car.
After seeing other reviews, a bunch of people fell for the same scam. They must be hemoraging money and have resorted to such scummy practices, it was really off putting.
I'm going to try and do a charge back for the insurance part, I felt really bad after the experience.
It's an aggregator that allows you to pick from the other aggregators, and you don't pay until you pick up.
The prices are consistently within 10% of the lowest price that I can find online.
You fill out a simple form (pickup/dropoff times/location, car preference), and it emails you quotes. They don't spam me, which is nice.
I tend to request the same quote multiple times over the weeks before my trip. It'll frequently find you something for less than what you initially paid for.
Ignore their janky UI, it's the real deal.
Is this just a US issue, if so, why is the US being hit so much harder than elsewhere? Surely it should be the opposite, as the lockdowns in the US were often much less strict than Europe.
I think it depend on the specific location. Here in Bozeman the airlines are complaining they can't fill planes because travelers can't rent cars here so they travel somewhere else or stay home. But for example LAX seems to have cars, albeit higher price than before.
A colleague that had to visit Seattle recently ended up renting a U-Haul truck out of desperation.
Clearly there are local shortages but overall it's not a problem to rent a car.
However, I locked in a reservation on a car quite a few months ago when the horror stories started circulating and the pricing was indeed pretty bad.
But since then I switched that rental and made another rental and the pricing strikes me as fairly normal. Not cheap and with the usual outrageous taxes and fees but these are with major non-discount rental car companies (albeit with a good corporate discount) but not out of the realm of what I consider "normal."
San Francisco, Portland, New York, European Cities, etc.
I'm actually planning a trip with a friend through the Northeast Regional. You can start at the White House / Smithsonian (seeing all of the history there), hop on a train to Philadelphia to see the liberty bell + the original capital of the country, then hop on a train and continue to NYC / Broadway and watch Hamilton.
No car (or airplane) needed. 100% trains / metros.
Train is more expensive for good reason! Its a much better experience. If we're talking about the price of Uber-rides / Rental Cars from NYC to Adirondacks... I bet you that the Train to Philly or even Washington DC will be cheaper than a rental car + all those miles you put on it!
So IMO, save your sanity and go with the train. But the busses exist if you really need to cut back on $$$ even more.
Now, frequency on SEPTA's Regional Rail lines has tanked during the pandemic, so using it may not be as practical as it once was. Haven't checked recently. Hopefully they get service back to reasonable levels.
- Trains get to skip traffic, but rental car might be cheaper if you're splitting it with friends.
- Trains do break down or hit delays sometimes, but traffic is always a risk on I95.
- Buses are the cheapest but have random people (dice roll) and traffic.
- Parking a rental car might not be cheap in a city center but can be a wash depending on transit costs. Again, parking cost can be split with friends.
So my decision is usually situational.
And yeah whenever I visit NYC from here it's always by train.
I was planning on mostly wandering around aimlessly (actually, I'll probably still do that :-) ). But I'm all ears for any "must see" locations.
Liberty Bell + museums are the main thing I know about.
The South Street area is also home to a bunch of mozaic murals by Isaiah Zagar, which are definitely worth checking out. There are official tours, but you can also just check out the neighborhood map here and explore some of them on your own: https://www.phillymagicgardens.org/about-us/mosaic-mural-map...
If you like walks, check out the Schuylkill River Trail - it got caught up in the recent flooding so I'm not sure what kind of shape it's in right now, but I assume it'll get cleaned up pretty quick if it hasn't been already. The view of 30th Street Station and a nearby USPS building is pretty cool at night. I've heard it can get a little sketchy if you're down on the trail at night, but as a 6ft tall white guy I never ran into any issues on the route walked home from work for ~8 months. Your mileage may vary, but the worst thing I ever encountered was kids my age smoking weed down by the river.
You can also take a detour at Broad St up to City Hall (take the Broad Street line subway up and back down if you're tired). See the hall, see the Masonic Temple, see the smallest "LOVE" sign ever at Love Park. Back towards Old City there's Thomas Jefferson's little place while he was writing it, Declaration House. There's the oldest continuously inhabited street in America, with a little art walk on Fridays around there. And of course there's the Art Museum and Waterworks behind it.
If you want to speed up your whole trip, make strategic use of Philly's Indego bikes. A bike is a great way to tour up the Schyulkill, to get to the Art Museum, and head north along the bike trail past boathouse row.
Two friends and myself went to New York for the HOPE conference in Manhattan. We drove there but we're midwesterners so we didn't want to drive in the city proper. Our plan was to drive to New Jersey, leave our car at a friend-of-a-friend's place, and then catch the train into the city.
All went well until we were on our way home. The friend-of-a-friend was supposed to pick us up from the train station and drive us 5 minutes to his house so we could get in our car and head west. But he wasn't answering his phone.
While we sat there wondering what to do, I saw a pizza place across the street that said "free delivery" on the sign. I joked that we should order a pizza, give the address where our car was at, and then ask if the driver would deliver us as well. Without laughing, my one friend said, "let's give it a try" and strode off towards the restaurant. We explained our situation and a few minutes later the pizza guy was delivering the pizza, and us, to our car.
SF is also one of the better US cities in this regard. I spent several months in SF without a car and rented a car exactly one weekend to get to some further out hiking. There are actually plenty of transit accessible natural areas.
Red and purple and the best. Although purple's lack of distance degrades the value. Green, yellow, and expo are decent, but Yellow running at-grade degrades the utility somewhat, as for the expo line, as you said. The Green line didn't freaking connect to LAX, completely negating it's potential utility.
Blue line and orange line are by far the worst, being entirely at street level and interrupted constantly with cross traffic.
Honestly, what really needs to happen is: 1) Purple line completes intended extension. 2) Submerge the blue line and install new station for connection w/ green. 3) The orange line needs to be submerged and absorbed by the red 4) New rail line from the I-5 that follows the 405 S. It would connect with the expo, LAX/green lines, and terminate with the blue line in LB. The red line would connect/intersect with it slightly north of the 101.
Already, those are pipe-dreams due to... well, everything about building public infrastructure. But LA does have the bones for some decent public transit, even if they'll never really invest in it.
Over the summer I used the bus to get around and it worked well for some destinations (I spent a lot of time in Santa Monica because that was easy) but there were others that just seemed too much of a pain (I wanted to see what Malibu was about but never did).
Now as an adult who can afford a rental car I don't think I would consider going car-free for a trip to LA, unless the trip had a narrow focus (e.g. convention at convention center all week).
but even more frustrating was the decision not to extend the green (C) line train directly into LAX (due to lobbying by taxi interests and others). rather than even the flyaway, we should have a train line directly from LAX into downtown, a key regional business travel destination. there even was a historical train right-of-way for much (all?) of that route, but it's since been sold and parceled out.
But I can think of all of one trip in the past 10 years in the US where I felt like I was someplace where I could rely on public transportation.
It's just not viable for most trips in the US I think.
NoVa/DC and SF are both good examples though of generally safe, effective public transport.(not speaking of Portland or NY as I haven't used theirs)
We stayed a couple of nights with a friend in SF, and on the first night I hunted for what felt like an hour to find a street parking space, and I FINALLY found an open spot that didn't have any signs for parking restrictions. The next day we went to get the car and it was gone. There was red paint and "NO PARKING" on the curb that I missed in the dark, so the car was towed to a city impound. In addition to a parking ticket, there was a nasty note on the windshield about how I was a bad person for parking in front of a physical therapy facility and infirm people rely on that spot to be dropped off, etc. Something like $500 later, I retrieved the rental car and got lucky this time with a legal spot right in front of my friend's house. Shortly thereafter, I heard a crash out front and thought "wouldn't it be funny if that was our car?". It was. An elderly gentleman plowed into it. But apparently not before parking enforcement had visited again - there was another ticket on the windshield, apparently this time I hadn't properly curbed my wheels on the gently sloped street.
So yeah, in San Francisco I might take the flawed public transit, or Uber/Lyft, or scooters, or walking, or crawling or anything else over bringing a car into the city.
Curbing your tires is definitely something an out of towner wouldn't know, so I feel you on that. It has a decent reasoning, at least.
The real problem with public transit is that there are a bunch of routes that need multiple transfers and take 3x as long as by car (with none of the reliability). Most places will have parking within 2-3 blocks or garages, but yeah it's tough.
Signs for every single red zone is overkill (there are red zones on the edge of garages for example).
Mine almost always do, even though there are much better public transport options than you have. I don't generally have any use for a car while I'm visiting them, so there would be no point renting one.
(I can see this would be different if you are a family of five or similar.)
Citation needed: https://www.thetransportpolitic.com/2009/02/20/transit-overl... "San Francisco’s example may be the worst in the United States"
Fortunately, there's a car equivalent of AirBNB, and he was able to rent an individual's car for around $80/day (I can't remember the name of the service, unfortunately).
I guess when you're on an island, cars aren't all that fungible.
I just use my phone and I get to drive a modern EV for a very affordable price without stress. No human contact needed.
You also have Vy which is owned by the Norwegian state : https://www.vy.no/alt-om-reisen/andre-transportmidler/vybil
And then nabobil.no or hyre.no in the for profit side.
Why do car rental companies have such a problem with this? I haven't rented a car in 5 years, but I rented a bunch in the 5 years before that. I don't think even once I was actually able to get the car I reserved, they are always out. There's even a joke from the '90s in Seinfeld about this.
Why are car rentals so much worse than other industries with reservations? Rarely would this happen at a restaurant or a hotel. Only cars seem to have this problem.
I drove instead of flying recently instead - except for the long drive getting there, it was far better to be in your own car.
Probably another local specific thing though.
It makes me happy though because it just means that the people having to work evenings, nights, weekends, and holidays are finally gaining some negotiating power.
I'm sure there will be problems, but it's very possible that the media will be exaggerating for headlines. It's not like a rental car will just fall apart if it's kept and maintained for an extra year or two. They're made of metal, not paper mache, and replacement parts are still available.
I'm usually not big on gig economy services, but this one has made it much easier, and the owner of the vehicle was stoked, he earned 2 car payments in 9 days.
* I'm not plugging turo, I just don't know any others in that space and is the one I use.
> As a result, car rental prices jumped to an average high of $120 a day this summer, compared with about $45 at the beginning of the year, according to a study by the travel booking site Hopper.com.
Maybe they need to be even higher?
https://connorleech.info/blog/the-american-rental-car-cartel
I think it’s fair to say that a lot of consumers aren’t much affected by them. Many businesses are scrambling, though.
Not directly but indirectly through higher prices on just about everything. Plus ever had your dishwasher break? Good luck getting parts… that stuff is in super short supply right now and that is just one instance. Think about elevators, MRI machines, you name it…
The supply chain runs deep.
Similarly, most of the time, most people don't need a rental car, but the price of car rentals suddenly becomes more relevant if your car is in the shop for repairs.
Some very few buildings are designed to withstand (all but a direct hit by) a nuclear bomb. A failure of such a building would certainly exacerbate problems that arise from the nuclear war.
Likewise, the U.S. government (and many other first-world nations' governments) was supposed to have been on the ball for a pandemic. Unfortunately it, uhhhh, failed. And it certainly exacerbated the problems that arose from the pandemic.
Rental companies sold off stock when demand decreased to stay afloat which was rational from their perspective (and something they've done before). Problem was that when they went to re-purchase inventory, there was a car manufacturing bottleneck caused by a chip shortage (both supply chain disruption, and vehicle manufacturers voluntarily giving up their limited fab slots to consumer electronics companies because they predicted incorrectly a decrease in demand).
PS - And some seeming supply chain disruption was actually caused by panic buying instead e.g. toilet paper, water bottles, generators, etc.
When demand exceeds 100% of normal capacity it reflects a lack of elasticity in the system rather than fragility.
I'll acknowledge the wood shortage though due to beetles eating the supply and saw mills ramping down right as demand was shooting up.
More broadly, no, I am not seeing this "critical pieces have only so much slack left to stretch." Seems like hyperbole without substance. What are these critical pieces that are just about to fail?
[1] - https://www.ers.usda.gov/covid-19/rural-america/meatpacking-... [2] - https://www.cnbc.com/2020/05/02/coronavirus-devastates-agric... [3] - https://www.cnn.com/2020/04/28/politics/defense-production-a... [4] - https://www.washingtonpost.com/outlook/2020/05/04/trump-meat...
Dunno how anybody could be surprised at the outcome; people warned of exactly this happening back in March of 2020 but they were harassed, mocked, shamed and yelled at.
The second and third order effects from the last year and a half will no doubt have more of a negative public health impact than covid ever did.
> The second and third order effects from the last year and a half will no doubt have more of a negative public health impact than covid ever did.
Really? COVID killed millions and made millions more very sick. Meanwhile industrial economies are doing overall quite well despite lockdowns and some labor shortages.
What would have caused them other than the lockdowns?
https://www.statesman.com/story/business/2021/03/12/nxp-coul...
There was also a Samsung plant similarly affected, which I think didn't really get back operational until the end of March.
I don't totally understand why foreign chip production couldn't ramp up quicker. But I don't think it's related to USA "lockdown"... but maybe I'm missing it?
Cars are not perishable items. The existing supply should prevent us from going into chaos for longer than that.
Use costcotravel.com