General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsThe average American can no longer afford the average-priced new car or truck
New car prices have been rising rapidly in recent years, various studies showing that Average Transaction Prices what buyers actually pay after factoring in incentives and options have hit record levels. And that means that more and more American motorists are being priced out of the market.
The average median-income household can no longer afford to purchase the average-priced new car or truck in 24 of the countrys 25 largest metro areas, according to a new study by the financial website Interest.com. The exception is Washington, D.C., according to the study, which also found that in 16 cities, median family incomes fell at least $10,000 short of what it would take to buy the typical new vehicle.
The average new vehicle now goes for $32,086, according to Interest.com which works out to a typical monthly payment of $633. While the number quoted by other tracking services vary slightly, theres general agreement that prices are rising a good bit faster than the rate of inflation. TrueCar.com puts the so-called ATP at $32,074 last month, an increase of $1,110, or 3.6%, from February 2013.
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Few expect the upward trend in pricing to mitigate any time soon, however. For one thing, manufacturers have been cutting back on the lush incentives they used to draw buyers into showrooms during the Great Recession. Theyre also passing on the increased cost of new mileage, emissions and safety regulations. And despite it all, consumers continue loading up their vehicles with ever more options that have helped push prices to record levels.
https://autos.yahoo.com/news/average-american-can-no-longer-afford-%E2%80%9Caverage-priced%E2%80%9D-new-car-or-truck--and-why-it-s-getting-worse-013001053.html
GoCubsGo
(32,074 posts)I suspect it has a lot to do with the fact that new car prices are so outrageous.
Wilms
(26,795 posts)And he wasn't a Progressive or anything like that.
Curmudgeoness
(18,219 posts)or ever will. I have always bought the lower end of the model line vehicles, and have always had good luck with them.
But I am disgusted with all the standard items in new cars these days that I have no desire to have, but I have to pay for anyways. I do not want access to the internet, or the ability to use a phone while driving. Hell, I can still read a map and don't need the annoying GPS either. I just want to get from Point A to Point B, and I don't want to pay for all the fluff. But I have no option....and that is why the price is so high.
LeftyMom
(49,212 posts)They have things car makers think young people want.
Curmudgeoness
(18,219 posts)I hadn't thought of that reason. I have been a small, 4-cylinder, economy car person from my first car to my current one (except for that Miata I got when they first came out but it was still small and good gas mileage).
But sadly, this makes the cheaper models more expensive for those young people.
FarCenter
(19,429 posts)Which is why GM small cars are crap (note ignition switches made in Mexico that don't stay in position), but why Civics, Corollas, etc. last for 200,000 miles.
Curmudgeoness
(18,219 posts)So far, besides oil changes, I have replaced the brakes and the tires once. I expect the second half of the mileage to need more repairs, but cheaper than a new car.....and they quit making the Matrix last year and it is just the perfect car for me. And I am an old fart.
MineralMan
(146,254 posts)My wife and I bought a Kia Soul almost two years ago. At the time, it was one of the least expensive cars on the market. Like everyone, I tend to notice other Kia Souls. At least half of them I see are being driven by people over 50 years old. The same was true of the similar-sized PT Cruiser. Both were marketed to the youth demographic, and both were avidly bought by boomers.
The reason is price, economics, and comfort. The Soul has more legroom than any other economy car, and good cargo space. Good mileage, and easy entry and exit, due to its boxy body.
How cars are marketed doesn't dictate who buys them, in many cases.
Response to Curmudgeoness (Reply #3)
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nadinbrzezinski
(154,021 posts)So as few electronics as possible was a priority. So our poor thing has manual everything and AM/ FM with in think a CD player.
But we chase brush trucks. We have after market items on our Sahara, like all metal, and are considering raising it for better clearance. The downside, a tad more top heavy.
We bought it used, low mileage, cash, and it was still expensive. Jeeps keep their value though
MADem
(135,425 posts)Not worth it for as little as I drive. I have a "beater" car and if I need a nice one for a particular purpose, I will rent one for the day or week.
pipoman
(16,038 posts)Ever.
frazzled
(18,402 posts)So I went to the site they mention, TrueCar.com, and punched in five "average" kind of cars and got these prices:
Ford Fusion: $21,100
Honda Accord: $22,080
Toyota Prius: $22,295
Subaru Forrester: $23,984
Chevy Malibu: $21,177
Now, you might not want any of these cars (I personally would buy another Prius: ours is 8 years old, and we paid about the same price for it 8 years ago), but they are "average" kinds of cars, in my opinion. Mid-size cars (not SUVs, not luxury), and they are a good $10,000 less than what is being quoted. They must've factored in a few Tesla models or something to get that "average" price.
Average price should not be determined by simply calculating an average of all the cars on the market. It's like the old joke about the average wealth of the people at Joe's Bar and Grill--after Warren Buffett has walked into the joint.
DJ13
(23,671 posts)That would still be too much in todays lower wage economy.
frazzled
(18,402 posts)but I think there are several ways to approach it.
We keep our cars a long time. The car we had previous to the Prius we had for 13 years. We drove it pretty much free for many years after paying off the note. And it was super reliable and we never had to put big money into it. We've had this car for 8 years now and will keep it hopefully for at least another two or four. If you dollar average the price over 10 years rather than the term of the loan, it's a lot less than the amount you quote.
You don't have to buy new, of course. (That's obvious).
Leasing is another option: it keeps the monthly payment down.
I'm not arguing that cars are easily affordable. They're not. I was just saying that $32K seemed awfully high for the average car, and you don't have to pay that much. But then, I don't like cars very much, so I probably would never buy a really fancy car. As long as it's safe and reliable, I'm pretty okay. Mostly, I take the train and bus and walk.
DJ13
(23,671 posts)I leased a new Honda in the 80's, and the standard mileage allowance was 15,000 per year.
Look closely at the commercials advertising leasing a new car now and the standard has gone down to only 10,000 per year.
The per mile penalties will force people into buying that car after the lease expires.
Rod Beauvex
(564 posts)I remember a couple of years ago, a guy was selling cheap three wheel cars from China. These are classified as motorcycles. Unfortunately, The EPA become overly interested in them, and it was determined that the guy had lied about emissions or some BS like that.
Lex
(34,108 posts)No effing way I'm getting locked into the mind set that I need a car that costs that much.
bigwillq
(72,790 posts)What a shame.
RebelOne
(30,947 posts)I have a 1999 Ford Taurus and will probably have until I die. But fortunately, I only drive it to shop locally within my neighborhood.
bigwillq
(72,790 posts)of taking care of its retirees.
my 2004 van only has 31,000 miles on it. even when i was working 3 years ago, i didn't use it to drive to work, i took light rail, hence the low mileage. i drive even less now. it should last until i die, but i'd really like to have a smaller hybrid vehicle now, but can't really see that happening with prices what they are.
Warpy
(111,141 posts)New car loans are going longer and longer before they're paid off. A large part of the expense is mandatory collision insurance, the amount set by the loan company.
Pretty soon, most people will be leasing them, only. The better off will buy pre leased cars when the lease is up. Poorer folks will be riding bicycles, scooters, and public transit (where it exists).
That's starting to happen around here, bus stops usually crowded even at off peak times.
Holly_Hobby
(3,033 posts)PowerToThePeople
(9,610 posts)Crazy expensive. More expensive than the houses I grew up in. Glad I only buy used, very used.
Liberal_in_LA
(44,397 posts)FarCenter
(19,429 posts)Agschmid
(28,749 posts)All wheel drive, but it's a stick. I doubt I'll pay much over 30k ever for a car...
Mnpaul
(3,655 posts)Two seniors at my school bought new cars with money made working part-time. They earned 100% of the money themselves with no help from the parents. They bought a matching pair of Nova Super Sports. Paid cash.
Response to Redfairen (Original post)
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Lex
(34,108 posts)you'll have a much greater interest rate on the note.
Response to Lex (Reply #27)
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flvegan
(64,406 posts)I mean, I appreciate the person who takes the economic backhand on the car that I want and who I purchase it from a year or so later. But still...
Spitfire of ATJ
(32,723 posts)aikoaiko
(34,162 posts)And they're a decently made car these days.
AtheistCrusader
(33,982 posts)Everything else is extraneous.
Drale
(7,932 posts)I payed 25k for my fully loaded Kia Optima and its just as nice as any Lexis or Cadillac that I've been in recently.
SheilaT
(23,156 posts)average figure is unrealistically high.
I'm another one of those who buys a car priced well under the supposed average. Several decades ago I bought new cars, then made the switch to used. And I always pay cash.
DreamGypsy
(2,252 posts)I fell in love like a drunk in a pond.
That twisted gal of whom I was fond,
She found a new man, on the internet.
Wham I'm spam and
It's cold and dark and wet.
Tell me what's a fella supposed to do,
When a car costs what a house used to?
And a house is just a pile, of chipboard, paint, and debt.
I'm at the city limits and
It's cold and dark and wet.
Big rig rolling over me in a blizzard.
I'm living on beans and chicken gizzards.
One day I was young, the next day I was old.
Late November and
It's wet and dark and cold.
Jobs, I guess they're like wild geese,
They all went flying overseas.
I'm standing in the rain, smoking my last cigarette.
Morning in America
Is cold and dark and wet.
Christmas lights are going up.
I could use a little joy juice in my cup.
Life is not just a walk, across the park.
No, not when
It's wet and cold and dark.
Copyright © 2006 Hacklebarney Music
Live and Learn
(12,769 posts)The only question is, will there be a market for it? I am considering getting one.
Posted on Thursday, March 13 at 8:47am | By Chris Preovolos
<a href="http://imgur.com/8hp7oxr"><img src="" title="Hosted by imgur.com" /></a>
The manufacturer claims 84 m.p.h. highway, an anticipated 5-star crash rating and a range over 600 miles on a single 8-gallon tank and unlike some other trikes based on motorcycles, it has a reverse gear.
The inline 3-cylinder engine makes 55 horsepower and the car will be available in 2015 for under $7,000.
http://blog.sfgate.com/topdown/2014/03/13/is-the-elio-three-wheeler-the-answer-to-urban-traffic-woes/
More info at: eliomotors.com
dilby
(2,273 posts)Three wheelers are considered motorcycles and only have to meet the safety specifications of a motorcycle.
freshwest
(53,661 posts)And have to keep them until they're toxic waste. Strangely enough, my ego is intact, what there was of it. I'll survive.
Mr. Average has now met up with my reality. I just hope that Mr. Average doesn't pull out his rifle and start shooting people over this.
Blue_Tires
(55,445 posts)and the average paycheck has not kept pace....
Rex
(65,616 posts)Say bye bye to the middle class...say hello to the working poor class!
Aerows
(39,961 posts)that is paid off is worth 20 brand new ones in actual value.
EDIT: I have a lock-stock-and-barrel AWD 3 row seat Cadillac SRX sitting in the driveway that is paid off. I have an added factor of having an in to used vehicles, but it is fine, paid off, and mine. Leather and less than 100K miles. Don't even ask me what the total cost is in it. I can tell you it was gotten for around 1/10th of what it was new.
moparlunatic
(82 posts)thing killed off a lot of good usable used cars making the ones left more expensive. That in turn made the new cars go up in price baiting people into an "easy monthly payment" for what for like 84 months now or something crazy.. As far as the stuff I read that American cars are crap, that's bullshit. I have 3 good old American cars that I drive the wheels off, made right here in Detroit by UAW workers. Maintain them and they will last just as well as anything else.