I was wondering what the average price of a car was compared to the average wages. So the average family makes $80,000 dollars a year and the average car is almost $50,000 dollars, even used cars have gone way up. I am amazed that people are spending that much money on automobiles.
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People have assets working for them other than their earned incomes.
As with everything else in Shiny-land, debt fixes everything. Cars used to be financed for 36 months. Now, terms are closer to 84 months, because people have been conditioned to only look at the monthly payment, not the total.
Steve
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They explain that in the article.
I skimmed over the article. It talked about ATP inflation, but I did not see mention of ATP being inflated by automakers dropping their lower priced models, which automatically inflates ATP, by leaving buyers no choice but buy more expensive models.
Ford Motor has three models with a base price under $30k. Two, the Bronco Sport and Maverick, are built in Mexico, so their price will be inflated by tariffs. The other, the Escape, is built in Louisville. So, what has Ford done? Announced they will drop the Escape, at the end of this year, and close Louisville for “retooling”, tho when the plant is supposed to reopen, and what it is supposed to build, has not been announced. One thing is for sure. Ford’s ATP will be higher next year.
Steve
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Than their base price is not under 30K. That is what inflation(Tariffs) do for you.
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And Ford is dropping the sub $30K, US built, alternative. That is how the lazy “JC” increases ATP and GP: take alternatives away from the customers. Note, the guy who wrote the article talked about his $20,000 Honda Fit. Honda took the Fit away a few years ago.
Steve
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This also increases the NOP, which can be catastrophic.
I just bought a new-to-me used car about a week ago. It is a 2022 Toyota RAV4 prime. The purchase price was just under $27,000. The car has just over 88,000 miles.
5 years ago, there’s no way I would have paid that much for a used car with that many miles on it. As it turns out, that was one of the lowest-priced cars I could find in national searches of that year, make, and model that hadn’t been in an accident — and it happened to be at a dealer just a few miles from my home.
The dealer had put new tires and brakes on it, the prior owner had kept up with the maintenance, and the drive battery has been sufficient for a 40-mile round trip drive on all electric.
I hope it lasts.
Regards,
-Chuck
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blink You sure paid up for reliability. Around here, you can get an off lease 2022 Lincoln Corsair, with under 20K, and a CPO warranty, for $30K, if you’re careful.
Steve
I paid for a plug-in hybrid SUV with 40+ miles of electric range. Yes, the brand has a strong reliability reputation, and Consumer Reports did recently say great things about that year, make, and model from a used car perspective. That did probably add a bit to what I paid, but if it turns out to be true, it should be worth it.
Regards,
-Chuck
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Toyota’s always hold their value on the Used car market. Edit: I should say they hold their value better than Most on the used car market.
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That was smart.
About 30 years ago I read “The MillionaIre Next Door” where the author explained that wealthy people tend to buy reliable used cars even though they could afford a new one.
Always better to find someone who is bad at arithmetic to pay the first few years of depreciation.
intercst
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There are hybrid versions of the small Ford SUVs available too. They are being recalled because the engine they have likes to set itself on fire…as I said, you paid up for reliability, vs Ford, the recall king of the world.
Unfortunately, we’ve had some isolated engine manufacturing issues that cause engine block or oil pan breaches that result in 2.5L HEV/PHEV engine failures. The fluid dynamics created by the Under Engine Shield and Active Grille Shutter System could increase the likelihood of engine oil and/or fuel vapor accumulating near other sources of ignition, such as the exhaust system.
Steve
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It is become apparent that cars are, increasingly, being designed to be leased. It’s as if the companies are saying “by the time the shoddy materials and design catch up to the car, the original owner will have moved on, the warranty will have run out, and we don’t care about the ownership experience after that”.
Steve
They certainly don’t make them like this any more:
Yes He is. Your RAV 4 should last for 300K if you keep the maintenance up.
Personally I would change the synthetic oil every 5K miles. Your Toyota manual will likely say change every 7-10K with synthetic oil. But Toyota wants you to replace your vehicle frequently. Oil changes are cheap. Engines are not cheap. Lubrication is everything IMO.
I change my own oil. At 5K the oil on the dip stick is orangey. But when I drain the oil it is black.
The bright sparks at some automakers have elected to save a few cents by not installing a dipstick on the engine. The Strabismus “Hurricane” six cylinder is one of these engines. Also, many maintenance schedules no longer have a set oil change interval. The owner’s manual says to run the thing until an idiot light lights on the dash saying to change the oil. A lot of maintenance schedules are written by the marketing department, not engineering, as they seek to make the car appear cheap to maintain. The trans fluid change interval on my 2014 VW is 40,000 miles. But the newer VWs show an 80,000 mile interval. The Subaru maintenance schedule in Japan says to change the fluid in their CVT at 36,000 miles, but the US maintenance schedule for the same transmission say it’s a maintenance-free sealed unit, never needs a fluid change. Of course the consequences of the lack of maintenance do not manifest until after the warranty has run out.
Steve
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Yep
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In April, I replaced my very reliable 20-year-old NIssan Altima that required the occasional oil change with a $21,000 2020 Tesla Model Y (71,000 miles on the odometer). I expect the Tesla to be every bit as reliable as the Toyota and Nissan vehicles I been buying over the past 40 plus years.
The maintenance schedule for the Tesla says to rotate the tires every 12,000 miles and to keep the window washer reservoir full. That’s it.
Tesla EV batteries are now expected to last 300,000 to 1 million miles.
intercst
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