QOTD: When Will the Insanity Stop?
I could probably write some version of this QOTD just about everyday, and I probably have written some version of it at some point over the last half-decade.
But it's worth revisiting. When will new-car prices become less insane?
Matt's post on the Dodge Charger Daytona today is fresh in my mind, but I am not here to pick on Dodge or any one automaker. The fact is that new-car prices are high. That, of course, means used cars also cost more.
And cars, lest I remind you, aren't a luxury good. Not for most of us. Even those folks who now work 40 hours a week in their PJs still need a car, at least in most places, to get the grocery store or the doctor's office or to drop their kids off at school. While some folks, like me, live in a place where it's possible to be car-free, and other share with a family member, there are plenty of people who need a car. And if both new and used cars are expensive, what's a person to do?
To make the situation more complicated, most "cheap" cars have disappeared from the market, and we're going to lose one of the two left that starts at under $20K.
Normally, you'd think that at some point, prices would adjust. If people need cars, but also can only afford so much, wouldn't automakers be forced to drop prices on most models? Especially now that pandemic-related supply chain disruptions are mostly over?
I suspect the reason the insanity continues is financing -- I suspect there are some scary loans out there. And unlike with the housing collapse of 2008, if a bunch of folks default on loans, it won't be a major economy-cratering crisis. Some folks will just find themselves walking after a repossession.
Still, you'd think the madness would have to end, right? You'd have to think affordable cars will return to the market and/or the average transaction price will drop, right? Right? RIGHT?
Sound off below.
[Image: PanuShot/Shutterstock.com]
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Tim Healey grew up around the auto-parts business and has always had a love for cars — his parents joke his first word was “‘Vette”. Despite this, he wanted to pursue a career in sports writing but he ended up falling semi-accidentally into the automotive-journalism industry, first at Consumer Guide Automotive and later at Web2Carz.com. He also worked as an industry analyst at Mintel Group and freelanced for About.com, CarFax, Vehix.com, High Gear Media, Torque News, FutureCar.com, Cars.com, among others, and of course Vertical Scope sites such as AutoGuide.com, Off-Road.com, and HybridCars.com. He’s an urbanite and as such, doesn’t need a daily driver, but if he had one, it would be compact, sporty, and have a manual transmission.
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