Money - It's the Worst Time Ever to Buy a Car

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Ridley-X4
Article here. I agree with it - I was visiting a local Hyundai dealership, and some of the new vehicles had a $1,000 markup. It's nuts. It's also a shame because I was really hoping to get a car soon. Then again, I don't really need a car of my own yet, as my parents' 2008 Honda Odyssey works perfectly fine despite having over 181k miles on it, haha! Perhaps I'll take this time to do a bit more research. My folks and I think I'd be best with either a Hyundai Kona, a Subaru Crosstrek, or possibly a Mazda3. I'm not sure which trims I'd get any of these cars in, either, though we can definitely rule out the Kona N, haha! But seriously, I'm aiming for a new or used car that's about $24k at most, and RWD is (perhaps unfortunately) out of the question, although it feels like snow has becoming less and less common lately here in CT.
 

wfooshee

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My last new car was in 1995, and I will never have another one. Good used cars are all over the place, so why suffer that expense and depreciation? For warranty coverage? How many repairs does it take to reach 5 or 6 hundred dollars a month in car payments?!?! For SEVEN FREAKING YEARS?!?!?
 
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Northstar

The Original Party Worm
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Good used cars are all over the place
...Unless you want a manual (in the U.S.)... Or one that isn't white, black or silver. Not to mention if you're looking for a certain type of car the selection may not be all that great, leaving the buying new route to be the best.

so why suffer that expense and depreciation?
Some people find it's worth the extra cost to get a car that is built to what they want. I'm actually considering getting a new car for my next one purely for that reason (went with CPO this round).

There's also the situations like you see with pickup trucks or Wranglers where the depreciation is so minimal you're not really saving much unless you go for one in terrible condition.

It's also worth mentioning that if it wasn't for people willing to suffer the depreciation (or leasing) there wouldn't be a good used car selection.

For warranty coverage? How many repairs does it take to reach 5 or 6 hundred dollars a month in car payments?!?! For SEVEN FREAKING YEARS?!?!?
It's not so much the cost of repairs as much as it is the peace of mind knowing I can hop in my car anytime I want and go on a long road trip without keeping an eye out for the nearest auto parts store. It's probably also worth factoring in the fact a used car obviously won't last as long.

Side note, still can't believe people actually go for the 7-year option.
 
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Danoff

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...Unless you want a manual (in the U.S.)... Or one that isn't white, black or silver. Not to mention if you're looking for a certain type of car the selection may not be all that great, leaving the buying new route to be the best.


Some people find it's worth the extra cost to get a car that is built to what they want. I'm actually considering getting a new car for my next one purely for that reason (went with CPO this round).

There's also the situations like you see with pickup trucks or Wranglers where the depreciation is so minimal you're not really saving much unless you go for one in terrible condition.

It's also worth mentioning that if it wasn't for people willing to suffer the depreciation (or leasing) there wouldn't be a good used car selection.


It's not so much the cost of repairs as much as it is the peace of mind knowing I can hop in my car anytime I want and go on a long road trip without keeping an eye out for the nearest auto parts store. It's probably also worth factoring in the fact a used car obviously won't last as long.

Side note, still can't believe people actually go for the 7-year option.
OP was complaining about money. Responding that it's worth the luxury to buy new doesn't really help someone who can't afford the luxury. It's not generally worthwhile for most people to buy new. That luxury comes with a big price tag.
 

Northstar

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OP was complaining about money. Responding that it's worth the luxury to buy new doesn't really help someone who can't afford the luxury. It's not generally worthwhile for most people to buy new. That luxury comes with a big price tag.
I wasn’t replying to the OP...
 

TonyJZX

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Australia
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well yeah. Even the Chinese cars here are all basically RRP and they arent affected by any tsmc chip shortages BUT since everyone else is affected then some people will fall onto Chinese cars and hence... demand everywhere.

It made me lol when I saw Ford pickups hundreds lined up without ecus. And I suppose they have a handful of ecus they cycled in and out of new cars when they're needed on the production line and then removed when parked.

Over here most cars have gone up in price inc. 2nd hand cars.

But also enthusiasts cars have gone up. eg. GT86 and any rwd v8 or turbo six. Any performance car from a discontinued company.

Any car in demand especially compact SUVs like RAV4s and also any medium sized pickup like Rangers Navaras etc.

If you can hold onto your car, then do so.

If you can avoid a new car, then do so.

If you can get away with buying a 'placeholder' car... ie. a sub $5,000 car that is reliable but willl get you over this "hump" then do so.

eg. I'm looking at a medium sized fwd Japanese sedan BUT its manual. People wil not gravitiate towards that.

I would be avoiding obivous traps like 10yr old BMWs. 10yr old Korean cars... perhaps subarus if you dont want to play with boxer 4wd complexitiy.
 

wfooshee

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I wasn’t replying to the OP...
But my point was pretty much the same as the OP. Financially, new cars make absolutely no sense. If you can afford it, great, but you can get an excellent used car if you're willing to look around. You can specify what you're looking for in the filters on the used car sites, including how far away you're willing to go to look at it. I have two cars at the moment, and a motorcycle, none newer than 2007 model.

As for how long they last, I inherited my dad's '88 Ford when he passed in 2010 and drove it for another 6 years, until my stupid sister overheated it by driving it after "the power steering went out," which was of course the serpentine belt being thrown, so no water pump, either... :mad: Over 260,000 miles, everything worked, still had cold air, power everything.

As for the "risk" of buying used, I've never kept a car less than 8 years after buying it. I've never bought a car with less than 100,000 miles on it. I've never had a car need major mechanical repairs beyond an A/C compressor. I've never sold a car I bought used except to a salvage dealer, when I'd pretty much used it up, or to an insurance company (I've had three destroyed by hurricanes...) As a matter of fact, the worst cars I've ever had have been cars I bought new.

A new car is a colossal waste of money. If you have the money, fine, go for it. It is true that without those folks buying new cars, there'd be no used ones for "more practical" people like me. :)

Even my motorcycle, being 18 years old and over 115,000 miles, is reliable as dirt, starts every press of the button, and runs smooth as silk. It's an '03 model. My Miata is a '99, and my Jaguar XJ8 is a 2007.
 
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GilesGuthrie

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Financially, new cars make absolutely no sense. If you can afford it, great, but you can get an excellent used car if you're willing to look around. You can specify what you're looking for in the filters on the used car sites, including how far away you're willing to go to look at it. I have two cars at the moment, and a motorcycle, none newer than 2007 model.
This is a very typical viewpoint of someone who is interested in cars. "Why buy a new one," they will say, "when you can get a used one for cheaper and the risks are negligible." They will then go on to say that they have multiple older vehicles. But for a lot of people, who are not interested in cars, those risks are everything. People not interested in cars don't want to maintain two cars plus a motorbike. They don't even want to maintain one car. They don't want variable costs, and they absolutely cannot stand roadside failures. They depend on their car to get to work.

For these people, leasing a new car is absolutely the way forward. Fixed monthly costs, one service during the ownership period, no need to repair anything (unless it's crashed), and then after three years hand it back and get another one. It's utility motoring. You only have to watch all the terrible cars in awful colours being driven badly by people on their phones, to get a sense of just how little people can care about motoring.

Who, of all the people you know who care about cars, would look at the market and choose to drive a 1.6 litre diesel crossover, like a Nissan Qashqai (or a Rogue in the US)? Nobody who cares about cars looks at their wants & needs, looks at the market, and thinks "Yes, this bland, inoffensive, cheap, economical car with a good safety rating is the one for me." So why are they everywhere? It's because they're buying a new car for five grand down and four hundred a month.

Until the start of the chip shortage, nobody paid full retail for a new car, unless they were buying exotic, limited or built-to-order (and I've seen some great deals on built-to-order cars as well). So, for sure, losing 60% of the value in 4 years seems financially mental until you remember that they only paid maximum 90% of retail, and even then they financed the deposit with their old car and paid off the new one at four hundred a month. These buyers don't typically see the depreciation: they're not handing over a massive wad of cash at the start and getting a tiny wad of cash at the end, because it's five grand down and then after three years they hand the old car back and get a new one, with the monthlies rolling over.

These sorts of people don't want "to look around" either. They want to turn up at a lot, or point to a screen, and say "that one," then conclude the transaction as soon as possible. People don't want to weigh the pros & cons of a car that's 2 years old or 4, has done 10,000 miles or 30,000 miles. They don't want to find a car that has dual zone climate control when they can tick the "dual zone climate control" on the order sheet. They don't want to check that the services were done on time by reputable shops. This is all unnecessary detail that can only cause stress for them.

So, yeah, new cars make a lot of sense for a lot of people, so long as you can see past the sticker price at the start & end of a traditional buy-as-asset commercial agreement. And I realise I've ranted on a bit about this, please note @wfooshee this is in no way a personal attack on you, I'm just presenting an alternative viewpoint.
Article here. I agree with it - I was visiting a local Hyundai dealership, and some of the new vehicles had a $1,000 markup. It's nuts. It's also a shame because I was really hoping to get a car soon. Then again, I don't really need a car of my own yet, as my parents' 2008 Honda Odyssey works perfectly fine despite having over 181k miles on it, haha! Perhaps I'll take this time to do a bit more research. My folks and I think I'd be best with either a Hyundai Kona, a Subaru Crosstrek, or possibly a Mazda3. I'm not sure which trims I'd get any of these cars in, either, though we can definitely rule out the Kona N, haha! But seriously, I'm aiming for a new or used car that's about $24k at most, and RWD is (perhaps unfortunately) out of the question, although it feels like snow has becoming less and less common lately here in CT.
Snow is about tyres. Get yourself a set of winter tyres and your snow worries are gone. My main advice to you for what sounds like it will be your first car is this: Don't back yourself into a corner. Don't insist on too many specifications. Each time you say "I want..." the pool of vehicles from which you can choose will decrease, and this diminishes your scope for finding a great car at a great price.

But generally, keep your cash in your pocket as long as you can while we have this supply chain issue ongoing.
 

TonyJZX

(Banned)
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Australia
Australia
I think in the current situation with 2nd hand cars being inflated and not far behind a new car, then get a new car.... esp. if it comes with very low interest rates.

Also some people love to get exactly the car they want with the options in the colour they want.

An example would be the car I'm looking at... for some reason black, charcoal or grey or dark silver is all thats available.

Lets be honest here, if you have the money you buy new, and look around you PLENTY of people have the money.

The 2nd hand market will always be a case of most people buying a car that's not quite as close to what you really want.

Sure to some people who are only after cheap A to B transport then you're always going to be find a white base Camry but is this the profile of someone who visits this place?
 
8,814
United States
Marin County
I'll only offer that it's certainly an annoying ass time to need a "new" car...

Me and my SO were looking at Toyota Rav4s (2012-2017 models) prior to the pandemic and those same cars are something like 20% more expensive now even though they are all older and have more miles at this point. Don't even get me started on BOF Toyota vehicles...used cars are not the deal (compared to equivalent new cars) they were prior to the pandemic.
 

Wolfe

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Wolfe2x7
It's darkly funny, because I've just about reached a point in my life where I might reasonably consider making payments on a new car, but the idea's been totally off the table as of a few years ago anyway.

New cars are amazing if I ignore the infotainment and "safety" manufacturers have stuffed into all of them to woo buyers, to add extra conveniences for a buying population that has skewed older, and to earn brownie points. The engineering has never been better; for reliability, for rustproofing, for NVH. I also quite like some contemporary styling trends. The problem is all that bloat that you cannot opt out of.

Given that almost all cars are great now, it makes sense that this technology has become a differentiating factor. The economics are rational, but just haven't worked out for people who'd prefer a more spartan vehicle -- until side-by-sides started selling like hotcakes in areas like where I live and municipalities were pressed to pass ordinances allowing them on as many roads as they could justify. Now side-by-sides buzz around all the time. I think that could be a clue.

I wonder if there isn't an overlooked segment of the market that would appreciate going back to basics a bit, but still buys new cars with all the bells and whistles for the reasons @GilesGuthrie explained? Lower costs, lower prices? Fewer chips.
 
39,077
I mean, realistically at this point right now it's probably not a bad idea to buy new and get the warranty and get what you want and have a fixed(ish) price than it is to buy used and pay not much less (for most cars and especially pickups; BMWs and whatever are probably still halved as soon as you sign the paperwork) and still have the huge hit in depreciation (once the market fixes itself) and have worse lending terms and pay whatever laughable price a dealer wants to quote you.





It's certainly factoring into what I want to do in a couple months.
 
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Danoff

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This is a very typical viewpoint of someone who is interested in cars. "Why buy a new one," they will say, "when you can get a used one for cheaper and the risks are negligible." They will then go on to say that they have multiple older vehicles. But for a lot of people, who are not interested in cars, those risks are everything. People not interested in cars don't want to maintain two cars plus a motorbike. They don't even want to maintain one car. They don't want variable costs, and they absolutely cannot stand roadside failures. They depend on their car to get to work.

For these people, leasing a new car is absolutely the way forward. Fixed monthly costs, one service during the ownership period, no need to repair anything (unless it's crashed), and then after three years hand it back and get another one. It's utility motoring. You only have to watch all the terrible cars in awful colours being driven badly by people on their phones, to get a sense of just how little people can care about motoring.

Who, of all the people you know who care about cars, would look at the market and choose to drive a 1.6 litre diesel crossover, like a Nissan Qashqai (or a Rogue in the US)? Nobody who cares about cars looks at their wants & needs, looks at the market, and thinks "Yes, this bland, inoffensive, cheap, economical car with a good safety rating is the one for me." So why are they everywhere? It's because they're buying a new car for five grand down and four hundred a month.
People who think about cars in terms of monthly payments are much more likely to buy new or lease because it's much harder (though not at all impossible) to get lending on an older car. That doesn't make it any less of a colossal waste of money in general. It's high luxury. And if you're thinking on a monthly basis, you probably cannot afford that high luxury.

The fact that people don't want to shop, and don't want to have any patience for maintenance, is perfectly fine as long as they're loaded. When they're not loaded, it's horrific to spend that much on something you're getting no enjoyment out of. It's precisely the people who buy those crossovers and who don't care who should be buying them used. Because they don't care.

It's hilarious to me that we treat the laziness of not wanting to shop for a few seconds, and not wanting to get brake pads changed or new tires, and the pickiness of wanting a specific interior color, as somehow being unimpeachable for people who, as we stated going in, don't really care about cars, and especially for people who can't afford it and are living month-to-month.

Let's not apologize for this, let's call it what it is. Terrible financial habits.
So, yeah, new cars make a lot of sense for a lot of people, so long as you can see past the sticker price at the start & end of a traditional buy-as-asset commercial agreement.
As long as they're loaded and want the luxury.

Edit:

We all know there are exceptions to this. Certain models simply do not depreciate, reducing the benefit of buying used. I'm speaking in generalities here. The people who are being careful to buy one of those models that don't depreciate probably understand enough to make an informed decision about whether to buy used.
 
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