Will Vehicle Prices Ever Decrease?

[svivian]

Lol the Dave Ramsay approach versus the debt leverager. Both are fine models to follow depending on your risk apatite.

 

[Mtnboy]

I'm about to take my Dad to pick up his brand new F150.... $77,000

 

[.270]

Wife's suv is pushing 150k and time for a new one. The used market is nuts, a used suburban is almost the same price as new one. I haven't ever bought a new vehicle because used late model vehicles used to be a better deal. Doesn't seem that way anymore. I am going to watch the market till the fall and then purchase one.
I am never going to get rid of my 03' f250 though. I can put a new powertrain in it 4 times over for the price of a new 250 these days.

 

[browning2480]

I also have an emergency fund as well with the car payment calculated into it. There is a difference between using debt as an asset and living paycheck to pay check.

Never said anything about living paycheck to paycheck.

 

[Mike D Texas]

I think that's part of the point though. The prices are going up because there is more technology involved and they are more expensive to produce. The prices aren't going every year because of some other economic force that says prices on cars has to go up.

I'm not disagreeing with you. Just pointing out some nuance to the pricing fluctuations.

Tech is a minor reason they go up. Demand and people thinking they have to have a new vehicle every 3-5 years is another factor. If demand went down, so would prices.

I know a truck I bought in 2001 is 2.25 times the cost now. I’m willing to wager most people’s income hasn’t gone up at the same rate. That’s why they keep extending available finance terms; to make people feel that they can justify “affording” it.


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[MattB]

Lol the Dave Ramsay approach versus the debt leverager. Both are fine models to follow depending on your risk apatite.

Yup. If you could take the $20K and invest it and get a yield north of the interest rate paid against the car loan, you would be dollars ahead. Dave Ramsay's advice is good for people with just enough financial discipline to follow it, but it can also be a detriment to building wealth.

 

[CorbLand]

Yup. If you could take the $20K and invest it and get a yield north of the interest rate paid against the car loan, you would be dollars ahead. Dave Ramsay's advice is good for people with just enough financial discipline to follow it, but it can also be a detriment to building wealth.

Even if you dont invest it right away or ever, some times the amount it costs you let someone else take the risk is worth it. You do this every month with insurance. People will spend a lifetime preparing themselves for the risk of something bad happening, they wont take risk for something good happening.

This is coming from a guy that did this. I could have bought a house in summer of 2020 but let the fear of a potential down turn stop me from buying one. I have been looking for one for about a year at this point and am still trying.

 

[Maz7869]

I'm wondering if now is the best possible to buy a vehicle. Prices are crazy, but will they get worse? Will they ever come down?

Based on the fattened pig mentality, dealerships are getting used to fetching premiums for vehicles and will probably do everything in their power to keep prices high and stay fat and happy.

• Vehicles I looked at purchasing 6 years ago are selling for more now than they were back then.
• 20 years ago a Z71 pickup was ~$22k new, now they are three times that.

What do you think? Get in now before it continues to climb or keep driving the beater and crossing fingers that things get better?

They will level as interest rates rise

 

[Fdh]

My wife is the general manager of three dealerships. She feels that as a result of the chip shortage and supply chain issues prices will not go down for at least six months.

 

[go_deep]

For prices to normalize we have to get through an entire production year with no material shortage.
Or a big recession.

 

[MattB]

Even if you dont invest it right away or ever, some times the amount it costs you let someone else take the risk is worth it. You do this every month with insurance. People will spend a lifetime preparing themselves for the risk of something bad happening, they wont take risk for something good happening.

This is coming from a guy that did this. I could have bought a house in summer of 2020 but let the fear of a potential down turn stop me from buying one. I have been looking for one for about a year at this point and am still trying.

Just keep in mind cash is depreciating at ~7% per annum right now due to inflation. Not currently a good place to hold value.

 

[Poindexter]

I’m celebrating my 33rd year in the car business. The past 12 of those years has been running technology companies that service dealers and manufacturers.

And I’m also some chump just commenting on a forum, so take that for what it is worth.

Now is the worst time to buy a car in history. It will continue to be through Q2. Stellantis, GM, and Honda are rumored to be holding back on production for the first half of the year. They’re benefiting from producing the loaded-up trims for higher profits.

And dealers are happy with this too. However, the used car market is getting tougher to navigate. It probably won’t be until 2025 that we see the kind of annual new car sales that we have become accustomed to. 2023 will be the first year heading back in that direction.

If you have a car to get rid of, do it before the Fall for maximum profits.

 

[CorbLand]

Just keep in mind cash is depreciating at ~7% per annum right now due to inflation. Not currently a good place to hold value.

Oh, I know. I am sitting on cash at the moment but am caught in "the need to buy a house but cant buy a house and dont know what to do." If I had a house, I probably would have taken advantage of the low rates and got a newer pickup.

 

[go_deep]

I’m celebrating my 33rd year in the car business. The past 12 of those years has been running technology companies that service dealers and manufacturers.

And I’m also some chump just commenting on a forum, so take that for what it is worth.

Now is the worst time to buy a car in history. It will continue to be through Q2. Stellantis, GM, and Honda are rumored to be holding back on production for the first half of the year. They’re benefiting from producing the loaded-up trims for higher profits.

And dealers are happy with this too. However, the used car market is getting tougher to navigate. It probably won’t be until 2025 that we see the kind of annual new car sales that we have become accustomed to. 2023 will be the first year heading back in that direction.

If you have a car to get rid of, do it before the Fall for maximum profits.

Your probably pretty much right on. I was thinking fall/winter of '24, but with employee shortages also I'm sure it'll take longer.

 

[Mosby]

Nothing wrong with buying the wife a new car if she wants one.

But don’t use trickery to make you feel better lol. At 147k miles most vehicles are just getting broken in!

What did y’all have? A Daewoo??


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Close...a Nissan Altima.

 

[NYyotekiller]

Ain't NO way I'd be buying a new vehicle right now. Especially a truck. I cringe when I drive by dealerships and see the sticker prices on them. $50k for a bare bones 1/2 ton pickup just blows my mind.

The scariest part to me is how many new vehicles you see on the roads right now.

 

[CJohnson]

I don't think that new vehicle prices are really that wild right now if you use some common sense. I think that the car selling model is changing from having 200+ vehicles on a lot to having people just order what they want online and get it delivered in 3-4 months. Most of the dealerships around here are tacking a 5-20% "scarcity fee" onto vehicles on their lot. It just takes advantage of the "gotta have it right now" crowd.

FWIW, I got a '22 F-250, 4wd, 7.3L gas for ~$48k. That's not too crazy. Big shout out to the guy on here a few months ago who told me about ordering it online.

 

[aftriathlete]

I've been looking at used Tacomas for a while now. Prices are so stupid I'm actually considering a lease for the first time ever. 2008 Tacomas with 150000 miles going for $24K, gimme a damn break. In the next couple months I'll keep looking before I have to pull the trigger, but lease options actually seem reasonable to me at this point due to how expensive used cars are right now. Did the Build Your Truck thing on Toyota's website, looks like I could lease a 2022 SR5 double cab 4x4 V6 for total lease cost of $16K, and that's for 15000 miles a year, I think it would be about a thousand bucks less to only get 10000 miles a year, but that would be cutting it too close on miles for me.

I don't know how leases are working out in practice right now though with short inventory in general, new and used, but I bet a lot of people are considering leases right now that wouldn't have before.

 

[dirtshooter]

Prices up in canada are insane right now

 

[go_deep]

I've been looking at used Tacomas for a while now. Prices are so stupid I'm actually considering a lease for the first time ever. 2008 Tacomas with 150000 miles going for $24K, gimme a damn break. In the next couple months I'll keep looking before I have to pull the trigger, but lease options actually seem reasonable to me at this point due to how expensive used cars are right now. Did the Build Your Truck thing on Toyota's website, looks like I could lease a 2022 SR5 double cab 4x4 V6 for total lease cost of $16K, and that's for 15000 miles a year, I think it would be about a thousand bucks less to only get 10000 miles a year, but that would be cutting it too close on miles for me.

I don't know how leases are working out in practice right now though with short inventory in general, new and used, but I bet a lot of people are considering leases right now that wouldn't have before.

Might have to travel some, but there's some out there for cheaper. Even if you spend $20K on a used one it's still yours, verse $16K to rent one.

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