Skip to comments.Why used cars are scarce - and expensive
Posted on 02/22/2013 8:04:48 AM PST by SeekAndFind
Yes, Obama's Cash for Clunkers program is definitely one reason used cars are in increasingly scarce supply-- and much pricier than they used to be. But another reason relates to something liberals despise: "trickle down" economics or, in respect to the increasing scarcity of used cars, the fact that low-income used car buyers do better when wealthier Americans (those who can afford new cars) do better.
The reason used cars have gotten increasingly scarce and expensive is the subject of a Wall Street Journal article, "Amid New Car Boom, Used Cars Are Gold." Its observations are illuminating:
The shortage of used cars stems from the deep plunge in new-car sales between 2008 and 2010, and the virtual disappearance of new-car leases during the financial crisis. As a result, three-year-old cars are now hard to find and even older models are holding their value. Another factor is a change by the three Detroit U.S. auto makers. To keep factories humming, they once leased tens of thousands of new cars to rental car fleets and then moved them onto dealer lots as used models after a few months.
There are fewer of those vehicles because manufacturers cut excess production capacity in recent years. Cash-for-clunkers rebates also took many older vehicles off the road.
The scarcity has pushed up used car prices, often to the point that consumers who finance a purchase with subsidized interest rates can get brand new vehicles for about the same as a monthly payment required for a late-model used car.
(Excerpt) Read more at americanthinker.com ...
I’m not so quick to blame Obama for this. I remember when I bought my 2006 Scion xB. I was going to get a used one, but they were almost as expensive as new. I considered new to be the better deal.
Almost Ditto. In my case, buying new *was* a better deal (by about a grand).
Didn't make any sense to me, either. But, I didn't look a gift horse in the mouth.
I blame his ilk. Over regulation of autos causes the new price to rise causing residential prices up. His cash for clunkers, however, removed a lot of the low end vehicles.
Hold on tight, folks; a crash is coming.
Come to Oregon. Portland and Springfield are endless used car lot strips. Thousands of good used cars, pretty cheap too.
I’ve heard that once an air bag deploys, the cost of replacement is prohibitive. That can easily “total” a car that has very little damage.
Get a black market airbag then sell the car to some poor person who has no reason to live.
My son-in-law is a used car salesman. Cash for clunkers nearly wiped out the industry.........
Cash for clunkers didn’t help.
I don’t know why the GOP hasn’t used cash for clunkers more as a campaign point.
We are in the market for a new (to us) car. I haven’t bought a car since the last century (1998), so I had some sticker shock at the Ford dealership. Then, I went home and looked on KBB (Kelly Blue Book) and found that there are new cars that are much cheaper, if you are willing to try a Kia or Hyundai.
Not sure what we will do. Our buying power is less than what it was in 1998, yet our needs are similar.
I bought a “totalled” 2006 silverado for a song. It had been rebuilt to the point that it looked and felt new. assume it has no airbags. Not a problem for me. It’s every bit as safe as the 1963 rambler classic I used to drive.
And besides, I’m not really into accident survival. I’m into accident avoidance.
I see a lot of used cars for sale in people’s yards.
WHY? Because the dealers offer little or nothing for them and want to sell them for a premium.
Also automobiles are so expensive these days people are driving their cars until there is nothing left of them.
My old 95 Silverado has over 200,000 miles on it and when I went to look at new trucks I could not believe my eyes at the sticker price. For $35,000 dollars I can buy a lot of repairs, and my truck still gets as good gas mileage as a new one.
A friend bought a new Ford 250 with a diesel $56,000.
Try to find a truck with rubber floor mats and roll up windows these days.Todays truck is more like a luxury car than something to work out of.
I do a 122 mile round trip commute every day. We also drive from our home in central Kentucky to Chicago to visit grandkids. I’m seriously thinking about a Kia Rio.
Either that or a Miata. ;-)
How many people can pay $40-50K for a full size pickup truck now on a 5 year note or if you somehow get a 7 year note, by the time you pay it off, you need another new truck!
I just bought a used Toyota Corolla with 90K miles for 6K and a 2002 Ford Ranger in mint condition with color matching cab with only 90K on it for $8.5K. So I got two used cars with low taxes that should last 300K miles each for basically $14K and some change.
Because they're just as guilty.
I am SHOCKED at the price of new trucks. I would not touch one with a ten foot pole.
BTW, regarding used cars: A friend of mine was in the car business for decades mostly selling pricey european cars. Toward the end he worked at a BMW dealership in the Seattle area. He said it got so bad that when a salesman sold a new BMW they made something like $200. But if they sold a used car the salesman could make thousands.
What that told me is that dealerships really overprice used cars.
I hear you, we bought our last new car in 03’ Maxima for $22k and now the same car is selling for $34k, so we waited and watched finally found a great deal on a Dodge Charger R/T w/ only 9100 miles on it, clean vehicle fully loaded for $22k, I can’t bring myself to spend more than this on any car. Cargurus is a great way to shop vehicles.
I still remember how Jesse Jackson shook Toyota down for billions after their ad showing someone with a gold-plated tooth (which JJ called racist). I don't want to buy a new Toyota if some of the money is going to go to Jesse Jackson.
Last car I bought was in 2004, a 7 year old Honda with 75K on the odometer, roughly $5,000. It served us well, had roughly 201K on the odometer, but had enough little things going wrong that I thought it wise to move up before interest rates shot up.
So I figured with inflation, the same type of thing might be $7 or $8K in 2012. Try $12K, if you could find it. The closest thing to it I could actually find was a four year old Scion xD, 45K on the odometer, $14.5K price tag. Yeah, they would arrange financing, but for something like 3% to 4% higher than I could get on a new 2013 Honda Fit for $2,500 more.
The monthly payment would have been pretty much identical with the higher interest rate. And $2500 more for four more years and 45K more miles in warranty didn't seem like a bad deal at all.
And the 1997 Honda with 210K on the odometer? I listed it at roughly double what the dealer offered as trade in, had 27 calls on it and sold it within 36 hours of the Craigslist listing. The buyer had cash for the asking price, another prospect waiting behind him and a third on the way. He didn't even try to price dicker. Smart man.