Average new car transaction price hits a record $48,043

Do they? Modern cars are using 0W-20 or lower weight oils solely for MPG/emissions purposes and pushing service intervals on that oil to 1 year for cost of ownership purposes. Then many people are not in the habit of changing their oil due to such long intervals so make that 2 years. Compounding that modern cars tend to burn a small amount of oil due to low friction rings for MPG purposes. I don't think you get long engine life with that recipe. That's not even counting the type of fancy things they are engineering into their engines like turbos, special valves, selective cylinder ignition (reduce V8 to V6 or V4) All that stuff breaks before 100k. It's a modern miracle a turbo last just 100k miles.

In the aughts and nineties the extra emission equipment (mostly gas tank vapor emissions) would break after 100k miles, but it wouldn't stop the engine from running. Now it's even crazier stuff that definitely will.

This is no longer true and there seems to be a regression in the length of the lifespan of the car, due to cost of repairs and other factors.

The golden age for reliability was when we had significant manufacturing advancements and improvement in engine building with tighter tolerances but lack of all the tech.

The problem is now with the tech, and average car owner has yet to realize just how expensive that tech is. Windshield replacement used to be $150, this is no longer the case. Now, if you have radar cruise control, it needs calibration. Some cars have acoustic glass, which is more expensive.

The cars have sensors all over, minor crash results in thousands in damage. LED headlights are $2k a piece.

Even Tesla, imagine the car is now 10 years old, worth $10k, is someone going to buy a new battery for $10k? There is going to be better tech out there and faster charging times.

Additionally, look at cost of ownership of something like an S class, those things become cheaper than Accords after few years. The reason is that all that tech is hard to maintain and now some of it trickled down into the main stream cars.

Not in the rust belt they don't!

Better engineering and a desire for ever-higher fuel economy means that today's cars are made stronger than ever before (when new) but with less metal. Less metal means the frame is compromised more quickly by corrosion.

All but one of my previous vehicles had engines and interiors that were perfectly fine at 200k miles but the frames and bodywork were so rusted out that the whole car was essentially a loss.

Car manufacturers COULD design a far more rust-resistant car, and it wouldn't even be that hard or much more expensive. But of course when your business is pumping out millions of a thing, you don't have much incentive to engineer it to last longer.

It's possible to buy used cars. Used cars don't drop huge amounts when you buy them, because they've already started to depreciate. Losing that "single owner" badge on a website or carfax might be worth $200, if that.

If you've purchased used cars and put anything more than a pittance, you've likely never been underwater on the loan. In 2019 I purchased a 2016 car for $25k with 10% down. I've made minimum payments on a 5 year loan and it's never been under water. While by their definition I think it qualifies as "very good," the "good" KBB trade-in value is currently $23k (honestly higher than I thought).

> No more $2k cars that'll semi-reliably get you to work for the next five years

They are out there, but definitely getting harder to find. They may need work to be reliable/drivable; if you can do the troubleshooting and work yourself you can still come out money ahead.

I haven't paid over $10k for a car in 20 years. Last time I did, it was one that I bought new. I will never do that again. The key is to look for a 15-20 year old car that hasn't spent its life in the rust belt and has had good maintenance.

> No more $2k cars that'll semi-reliably get you … to the 50-miles-away grocery store or Wal-Mart for your "big shopping" once every couple weeks, for the rural poor.

Recently I saw a video on YouTube about an impoverished depopulated Eastern European town where instead of having a fixed local grocery store, there was a truck that visited weekly. On the one hand, it’s sad to think of people being so remote yet dependent, but on the other it actually seems like an innovative solution to the problem.

https://youtu.be/q37qWA2cL5w?t=7m5s

This only works if wage growth keeps up with the inflation.

At least for cars, most people have to finance them so you would assume there is an interest rate where the monthly payments are too high for enough people to bring prices down. A lot of what has gone on the last couple years were extremely low interest rates coupled with the money supply increase. Can probably handle one or the other but not both.

Mark up IS NOT INFLATION.

Higher MSRP would account for inflation. Car prices actually have not raised that much over the years, as improvements have been made to the manufacturing process to keep costs down.

As long as there isn't massive increase in taxation I don't think ICEs will be hard to sell. There is plenty of people who don't want to deal with charging it for example. Or like the long range.

I disagree, your example is just what everyone is experiencing right now.

Nearly all newish used cars are selling for what people paid for them new. The current market does not represent a reasonable market value.

I can assure you EVs of today will depreciate faster than ICE vehicles, as new improvements are made to the tech. So much more money is being poured into batteries and R&D.

I don't think we're there yet at all. This is a very "silicon valley mindset".

The truck segment only just got the Ford Lightning and are at the start of the adoption curve. The inflection point probably won't be for another 10 years.

And you're likely to be able to sell an ICE vehicle to someone who wants to maintain it because they have all the necessary mechanical tools for a long time. There's a lot of people out there who might not be actual mechanics but know how to debug an ICE vehicle, and even know a machine shop where they can buy a rebuilt engine.

Even after vehicle manufacturers actually stop building and selling ICE vehicles there's going to be an after-market for them. There's probably some cliff that happens where gas stations start to disappear, but you have to age-out the existing ICE fleet pretty significantly, beyond the ability of people to keep their vehicles running.

I believe that EVs are actually going to face problems. While ICEs are expensive to produce now thanks to chip crisis, it will eventually fade off and prices will cool down, while raw material shortages for EVs (copper, cobalt, lithium, nickel) are predicted for years into future, probably full decade.

Thus in few years people will have choice to either own inexpensive ICE maybe hybrid or much more expensive BEV. Problem for BEV will be even more compounded by their inflexible charging (majority of people can't charge at home, 50% people in EU lives in apartments) and high electricity prices (especially in EU). Thus people will start switching back to ICE, purely from economical and comfort reasons.

I do not expect the infrastructure for EVs to be built up enough in 5-10y for this to be the case. In fact, if the people start buying EVs faster than charging stations appear, then the opposite might happen and people will want ICE cars because they can't rely on being to charge them if on longer trips outside home range. The existing ICE infrastructure (gas stations everywhere) is not a thing that can be replaced quickly.

10 to 15 is a bit different than "massively underwater", I think 30-40% is going to be hard to swallow by most folks.

When you pay $33k for a $23K MSRP car something is really wrong.

The car requires premium gasoline?

Is that a thing?

edit: Thanks for the info. Did not know that. I've always had piece of shit cars that could probably run on McDonald's french fry oil. :)

I like how you say "the dealer made sure not to volunteer any extra info" as if this was a secret and the dealer somehow scammed your friend into buying a brand new car at the height of a chip shortage and record high car prices.

The lifetime difference of premium gas financially is next to nothing.

I went to every Toyota dealer near me a few months ago. They only had one or two of each model of car in stock. They had random colors and expensive packages (the extra extra ones like random trunk hardware, not just the tech package for sensors) and then after all this up specced with no color choice, they wanted 10-15k USD on top just cause “someone else is ready to buy it if you aren’t”

I have a 2012 Prius with high mileage going strong. Bought used in 2013 for $17K when gas prices were over $4/gallon. A year later, gas prices plummeted and hybrids lost their value. Now finally they are in high demand again, along with everything else. It is crazy how I see the same car being advertised at around the same price I paid back in 2013.

I feel strongly that you’re likely to get another 10 years out of it if you keep up with regular maintenance. My non-Prius Toyota is 17 years old. The outside looks like a war zone from being a city car but the interior is in great shape and everything works perfectly. A family member has a Prius approaching 300,000 miles. Good cars.

[edit: Regular maintenance is key! I take mine in to my local mechanic for an oil change and inspection 2-3 times a year. For elderly cars, don’t wait for a noise or a light to go off :) ]

Slight tangent, but I bought a 2012 Civic shortly before switching to working at home. It has about 50k miles now.

I've been surprised by the results of simply leaving it outside that long. Weather stripping around the windows has dried out and cracked. And I have actual lichen growing on the car's exterior.

But other stuff has held up great. The paint (ignoring the lichen colonies), the tires, etc. And thanks to the wacky market these past years, its resale value.

Current minivan market is batshit crazy. We've had dealerships call us up offering thousands more than we paid for our (used) minivan three or four years ago, with 1/3 the mileage it has now. It's basically gone up in value by about as much as it should have dropped in value, in a normal market. I assume they expect to make a profit, so must be pretty sure they can sell it for even more than that. WTF.

I think people are getting whatever they can. Specially when they don't have an option.

This could be also due to some (marketing) "target".

The manufacturer might impose to a dealer (say) 1000 loans per year, if they meet the target they get an additional discount or a prize, not unlike the targets imposed for sales.

At least here (Italy) the so-called "km.0"[0] are very common (of course rarely for models that sell well) the dealers have often some convenience to buy a few cars themselves (they are "sold" vehicles to all effects as seen by the manufacturer) and then re-sell them at a discount (the 20%-30% less than sticker price is not unheard of).

Years ago these "internal sales" were driven by fiscal year reports, so you could find the "km.0" only in January/February, nowadays the manufacturers have moved to reports avery 3, 2 or even one month so you can find some discounted cars in every period of the year.

[0] these are cars that were registered but never driven

Obviously. If you CAN wait (like me) then you should wait. What I found interesting was the shifting business model. Just like housing pre-2008 it seems values are being driven up by "easy money".

You're certainly right that there has been major housing inflation in almost all major urban areas with good transit in the US. Still, there are several cities that are still relatively affordable with good transit and walkable neighborhoods.

Chicago. Philadelphia. Portland. Pittsburgh.

> What places are those where sky-high rent doesn't offset the benefit? I can think of a few places, but rents are $500 more than a mortgage here, let alone rent.

What are average salaries like, though? Cities are complicated because while rent is higher wages are often massively higher to compensate, although telework has complicated this a bit lately. Since cars aren’t any cheaper in low cost of living areas, that baseline cost is often harder to swing on lower income.

Not spending the U.S. average of $11+k/year to own a car also gives you an extra thousand a month for rent, which goes a long way even in the most expensive cities, and not needing to pay for parking often allows a hefty reduction in housing expenses in many cases, too, especially with more employers offering cash alternatives to their parking spaces.

I live in Eugene Oregon and haven’t needed a car yet. Previously was in Portland and also didn’t need a car even though I lived fairly far from the city center.

You must be right, although I could not find any feature lacking (touch screen, Android Auto etc. it is all here). Yes, you will be hard pressed to find an engine above 120bhp but electronically it is all there. But I am no expert and am not sure about the material, build quality etc.

It seems like a big guess here. Almost all cars sell a variant with ABS. For e.g., the lowest end of Hyundai i10 (D Lite) is $4500 and has no features other than a 46 mpg. The highest variant (Asta 1.2 Kappa AT) has all the bells and whistles with a more powerful engine for $8500 and has a lower gas mileage at 37 mpg. Still a bargain?

Now you know how the rest of us feel when Americans say things like "I flew from NV to AZ, stopping in FL".

Maybe not commonly, but I would like to know for sure.

Always wear a helmet, don't drink and ride, and don't ride a bike that's too big for you or too powerful for you. Beyond that, continually practice your basic riding skills - especially swerving. If you do that, which granted many riders don't, then your probability of serious injury is vastly diminished.

Gas is not that expensive. Even in CA, it is a few thousand dollars per year at most. And the 4Runner and other cars can get to a few hundred thousand miles easy, so compared to spending a few extra tens of thousands on a new car, gas is a negligible cost. Plus you’ll have a 4Runner.

500 cents per gallon, 15 miles per gallon, that is 33 cents per mile in fuel costs.

A 35mpg car would be 15 cents per mile.

At 20k miles per year (which is a lot), you’re looking at an extra $3,600 per year. But even after 10 years/200k miles, you will have massive resale value due to their reputation as being indestructible (assuming you live in a place that does not salt).

I would rather have a consistent and predictable gas bill than have erratic mechanical costs and a far shorter car lifespan.

Also gas is dollar cost averaged as you buy it over the lifetime of your car usage.

I'm not saying there isn't a point where gas would outweigh the indestructibility of the Toyota SUVs. I think that point is closer to $8-$10 a gallon like it is in EU.

One could do a proper discounted cash flow analysis but again the problem would he unpredictability of car maintenance on a non Toyota SUV.

And also ask yourself, would you rather a loved one get in a crash driving a Golf or a 4runner?

At least for while this changed. Not sure what things are like now though.

https://www.kbb.com/car-news/rental-car-shortage-has-hertz-a...

Be careful with ex-rental cars. These things have been abused to hell and back; think full throttle on a cold engine, the cheapest fuel available and a lot of unavoided potholes. On the other side, you know they have been maintained, but expect a lot more wear. You can buy one, but you should know why they are as cheap as they are.

I really would rather not. Much prefer my car free life.

You start by using insulting language and talking about hybrid vehicles which do not offer the same fuel savings as EVs, do not have the mechanical simplicity and elegance of EVs, and thus do not have the lower maintenance costs of EVs, as well as having a significantly shorter expected lifetime, while also supporting intransigent auto makers and stinking.

Then you agree with me by saying that upcoming EVs will be cheaper than ICE cars. (I think we can agree that in the context what is meant is a cheaper TCO).

And $10k is a very conservative number which doesn’t even account for a lot of benefits, from safety, to externalities like pollution emitted by a hybrid or other ICE car, to the probable much longer lifetime of an EV relative to an ICE car, as well as being able to look at yourself in the mirror.

Also your choice of a Corolla for comparison is surprising. We should compare prices of cars with similar features, not low end cars against high end cars. This pretty much invalidates your comparison which claims a $20k price difference.

And even if you still believe what you think, one way to look at it is that we are all going to be paying for climate change one way or another. If we pay a little up front to save on gas, maintenance, safety, fun, reducing pollution, and supporting companies that give a shit, we will reap even more benefits later.