Used vehicle inventory has rebounded from 2021 lows:
https://cms.zerohedge.com/s3/files/inline-images/US-auto-inv…
https://cms.zerohedge.com/s3/files/inline-images/US-auto-inv…
https://www.zerohedge.com/personal-finance/how-vehicle-produ…
Now auto dealers wouldn’t be taking advantages of the consumer would they? Nah must be another reason. /sarcasm
Now auto dealers wouldn’t be taking advantages of the consumer would they? Nah must be another reason. /sarcasm
With the media screaming “shortage!Shortage!!SHORTAGE!!!” all the time, the average ignorant consumer doesn’t know any better, and long financing periods enable price gouging.
Steve
about 70% of the US economy amounts to sucking money out of consumer’s pockets.
…
the average ignorant consumer doesn’t know any better, and long financing periods enable price gouging.
Poor victims! I’ve run out of tears to shed for them.
Teslas just got a few thousand dollars more expensive. I thank all Tesla buyers for supporting my largest stock market position! Tesla owners are beautiful, caring, and generous to a fault.
Question, how do you guys feel about the companies you invest in gouging, ripping off their/your customers? Do you feel complicit?
The Captain
With the media screaming “shortage! Shortage!! SHORTAGE!!!” all the time, the average ignorant consumer doesn’t know any better, and long financing periods enable price gouging.
Steve
The feeling that, gosh, it ONLY adds $10 or $20 to my monthly payment has been a useful tool selling cars for some time now. Tacking on useless crap that’s not needed. Folks get lulled into the ‘low’ monthly added amount. FOR YEARS.
The part I like best about vehicle loans, they are not structured like a house loan; the earliest payments of a car loan are front loaded, more interest paid than should be, principal not paid down proportionately. I forget the name of the technique. Rule of 78??? (Maybe it’s not even in use now???)
Dunno. Haven’t financed a vehicle since a very long time ago. Always cash since 1980’s. (Can’t afford car payments! Yuck.)
The feeling that, gosh, it ONLY adds $10 or $20 to my monthly payment has been a useful tool selling cars for some time now. Tacking on useless crap that’s not needed. Folks get lulled into the ‘low’ monthly added amount. FOR YEARS.
Radio Shack started offering it’s own financing in the late 80s. The tactic we were told to use was to keep restating the cost until the payment sounded trivial to the customer. $100/mo too much? How about $25/week? Still too much? How about $3.57/day?
Of course, the auto industry has also stretched out the payment period. Three years used to be the norm. Now, the average period is about 6 years.
Updated March 2, 2022
In the fourth quarter of 2021, the average auto loan term was more than 69 months for new cars and over 67 months for used vehicles, according to the Experian State of the Automotive Finance Market report.
https://www.creditkarma.com/auto/i/car-loan-term
Add in Fed rate suppression, and it’s easy to put people into a $50,000 vehicle that they couldn’t have been remotely qualified for 20 years ago.
Steve
Question, how do you guys feel about the companies you invest in gouging, ripping off their/your customers? Do you feel complicit?
We shareholders can’t even get management to tell us who in government they are bribing and why. Fat chance we can prevent their profiteering. During the annual gas price hysterias in the early 2000s, I could not do anything about being rogered at the pump, so I put the entire IRA into oil companies every spring so I would get back what they gouged out of me.
Steve
“Question, how do you guys feel about the companies you invest in gouging, ripping off their/your customers? Do you feel complicit?”
Nope.
Costs are going up. Now my pool service has tacked on a $10/visit ‘gas surcharge’ that will stay in effect until gas prices decline to $2.50/gal - probably never… ripped off $20/month…
But food, gas, oil, natural gas going up…and costs to companies going up.
world demand sets oil price - the most commonly traded commodity in the world.
Yeah, with 7% annual inflation…prices are going up…and will continue since it’s likely we’ll have 7-8% inflation every year for years.
Used car prices are up because of scarcity. Few new cars to be had, and most of them are ‘loaded’ with high price options, high price models, and full MSRP or higher prices…plus ‘wallet cleaning’ of undercoating, paint protection, carpet protection, etc. Trunk nets…anything to get more bucks out of you. Yeah, your 5 year old car is worth almost as much as a new low end model car it seems…Good if you’re selling. Not so good if you need to buy.
Even gas guzzlers are up in price. Although I’m surprised they sell at all. Maybe folks don’t appreciate a 14 mpg car is going to cost a lot of money to operate…as much as their car payments…
t
Nope.
Yup. If a company can show record profits during a period of inflation, they are clearly taking advantage of the expectation of higher prices to get even more from the customer.
