Car affordability in 2022 and beyond

the last time i purchased a car (2013) i went to a dealer, looked at the inventory, amde an offer, dickered back and forth, came to an agreement and drove it home.

this time, i searched high and low through fictional online inventories, ultimately finding nothing i wanted in stock.
after leaving my email with a number of dealers, i finally lucked out into msrp and about a month wait for a car that was being built in the usa.

it's a sea change

 

It's good to hear from individuals who took charge of their situation to get the vehicles they wanted at a price they wanted.

 

I agree. But it's the abrupt change in the car market that has left some of us baffled as to what to do next.

Before the pandemic I could buy a beater for under $1,000 that was fixable and then just keep it going. The other day I went to get a totaled undriveable and apparently unrepairable side impacted 2008 Prius for a parts car. I offered $1,200, but then others kept calling the guy with higher offers.

I also knew someone who bought a newer car, a 2019 Ford Escape for apparently somewhere close to $20,000 or more and then 3 months later the transmission went out and were faced with a $9,000 repair bill. Now I know they could have done better diligence at reseaching better vehicles and the history of this particular vehicle and others. But still, when on earth in history were things like this?

Getting a used transmission for a couple hundred bucks and throwing it in on a weekend aparently wasn't an option like it used to be. Just finding a mechainc that has the time to work on your car that is no longer repairble by the owner is now becoming extremely hard. It's three weeks out just to get a single tire repaired.

All this makes me wonder what the point is anymore. Do I try hard to buy a new car that's three or four times more that what I can actually afford or do I just give up and go without a car? In reality, I have no idea what I would get if I needed a car. I'm afraid of old clunkers, I'm afraid of semi-used and I might be able to afford a new Nissan Versa, but that's about it.

 

The article that revived this thread was about how high the average transaction price for new cars have gotten. The fact that it is higher than the lowest listed MSRP is not a sign that buyers have stopped using the strategies you've listed here. It is an average, somebody is paying less out of pocket.

But some people can't wait for a car, and they aren't all because of want. If there current isn't any of those cheap trims available, and the manufacturer has no intention of making more in the near term because pent up demand and limit parts supply means better numbers at the end of the quarter, what are they to do?

Saturn was trying to change the process. It stopped doing so soon after the leadership that started it was no longer in power.

The online builders I've played with have all ended with submitting your contact info so a dealer can call you. Including the Mini EVs.

 

That just means you haven’t ordered a Tesla
I do believe a large part of the appeal Tesla has isn’t the cars, it is the lack of dealers

 

I just assumed that goes without saying at this point.
So when will Tesla have a car that competes with the Corolla on price?

 

I will order a Tesla when it makes sense for me. But as it is now, I'm on the verge of forgeting car ownership altogether. My budget is $15,000. A $32,750 Tesla, even with the $5,000 Colorado incentive ($40,240 - $5,000co - about$2,500fed = $32,750) is about twice what I can afford.

 

That wasn’t a comment on prices, just the fact that the use of dealers is a business choice.
You are not Toyota’s customer, the Toyota dealer is.

 

True.

But mind you the thread is about car affordability.

I sure hope Tesla makes an affordable (for me) car some time in the future. I could see me spending $20,000 on an EV with the electric and maintenance savings. There are lot of things Tesla does right. There are also things Tesla does that I dislike or am unsure of. But over all they'd be on my list of next car to buy if they were a bit cheaper.

 

new tesla model next year, starts at 25k less $7,500. and state credits if you qualify!

 

i wouldn't use self driving, so it doesn't bother me. too much hype about tesla problems, you don't know what to believe

 

That would be awesome, even though I don't qualify for the full $7,500 federal tax credit. I believe the $5,000 state credit isn't affected by lower income.

There is a rumor that next year there will be a potential loophole to get the full federal tax credit. I can only hope!

 

a lease is supposed to be a loophole, but i haven't seen any great lease deals yet

 

I know. I was looking at Bolt leases, but never could find one that actually included the federal tax credit in the price.

Next year the credit can go directly to the seller (dealer). What isn't clear yet though is if it still will be reflected on an individual's tax return at the end of the year as a credit towards owed taxes or if it will just be a payment to the dealership as far as the consumer is concerned.

There's the potential for someone to go buy an EV, have the credit go directly towards the downpayment, then owe $7,500 at the end of the year for not owing any taxes.

We'll have to wait to see how the IRS interprets the new law because it doesn't seem clear on this issue. Actually, to me it seems to be the latter. That is, you will need to owe $7,500 at the end of the year, as far as I can read.

 

Tax credits versus tax deductions ought not be that complicated - even for the 85+ percent of American households who take the standard deduction.
If BEV's are ever to become more mainstream they're going to have to become real-world, common-people affordable WITHOUT the kickbacks - which still have the stench of a "tax loop-hole for the wealthy."

 

They aren’t complicated.
That said, I agree that the more ‘up front’ affordable they are the faster they will become adopted.

Tesla sales continued to grow rapidly in the USA when they had no federal rebates.

 

I just hope that while ICEV prices continue to climb that EV prices fall enough to make up for the missing affordable ICEV's. It would be a shame if EV prices stopped at $30,000, or even $25,000 and all the incentives dried up and the guy making $10 an hour flipping burgers can't afford a car... Unless they fix the the public transit system nationally of course. I could go for that.

Anyhow, I'm off to work on my bike.

 

I'm a two-lane highway being converted to a four-lane highway away from being able to commute via bicycle.
I probably will not do so very often because even though I'm not a customer facing employee, it's HUMID a.h. in the deep US SE and I do not have access to a shower.

If real-world EV prices ever REACH $30k, for a not-a-subcompact BEV then I might be interested, but I just bought a new left-over '23 GMC for MSRP minus 5,000 - which was STILL a little over 36k after TTL!!
I got 23.4 mpg from my first 400 mile 3/4 of a tank which would be horrible but not for a vehicle with 6 seatbelts and a roughly 10,000 lb tow rating. I find the 500+ mile tank range to be refreshing as well.

I tried for one month and in 5 states to find a Toyota dealership that would deal with me for a Taco which would have been challenging to fit 3 grandkids into, but those trucks start out life at roughly 40k and once again the SE Toyota group kept my 30+ year Toyota boycott alive.

The two BEV options (real-world available) uncluded a Bolt which would have been 40K before the tax kickbacks and four states away....and a T3 which is now down to to roughly $44,500 including destination, and TTL.
The result after paperwork and an estimated 2 month waiting period would have been a really fun to drive 5 pax sedan with 250 miles of tank range, half the towing capacity and one less seat belt than my GMC....for roughly $1500 more, and I would have had to keep my venerable 2009 in the fleet and gift my 2006 Envoy to a relative instead of the otha way around.
I can charge L1 for free at work (with permission - I asked) and L2 is possible with a little unauthorized building modification.

I could not have permission from my CFO to buy one even if the OTD price REALLY WERE 30K.
....or 20.

I find $36k to be shockingly expensive for a base model full-size truck with a $1,000 towing and convenience package - and the MSRP was over 40K!!
KBB estimates that my 5-Year Cost to Own including out of pocket expenses like fuel and insurance, plus the car's loss in value over time (depreciation) would be over 53K.
Using the same numbers from the same source for the T3 I would wind up being @ roughly $42k.
Shockingly (no EV joke intended) the depreciation for the T3 would be higher according to KBB with the operating costs and tax kickbacks making up roughly 3/4 of the difference in operating costs.
Actually?
My operating costs would be lower still with access to cheap ($0.05 kW/h) electricity at home and free electricity at work.

So.....
Maybe next time.
Without the tax kickbacks?
According to KBB's numbers, without the tax kickbacks, BEVs are still cheaper base-to-base but they do come with all of the usual disadvantages, including NOT being able to haul malodorous cargo to a dumpster (like I did this AM!) or outsized cargo without hooking up a trailer.
Also I would have had to convince my CFO that range anxiety isn't a thing - even during hurricane season, cars are as comfortable to drive as CUV/SUV/Trucks...AND stopping 3 times during our quarterly out of state trips for an hour is a good thing.
Happy house.
Happy spouse.
I'll pay an extra $2200 a year for that!

MY mileage.
YOURS will be different.