In the comments over there: "I helped my elderly father lease a new Jeep three years ago. I think the retail on it was about $25k. He hardly drove it and it was in great shape a few months ago when we went to turn it in. A few days before that I had the brilliant notion of buying the car from him at the lease buyout price (which was about $14K) and selling it. Two days later, I bought out the lease, took it to Carmax, and walked out with almost ten grand which I gave right back to my dad. He said that made it worth giving up driving." (That is, Carmax gave him $24,000.)
October 29, 2021
"As a new car, the Civic would have had a sticker price of around $21,000. But within seconds at the wholesale auction, the two-year-old model, with 4,000 miles, sold for $27,200."
"Soon after, a Nissan Rogue fetched what it would have cost new in 2018. A three-year old Toyota Camry with large dents and scratches on its hood sold for $14,200, nearly twice what it would have brought just a few years ago. And a 2015 Kia Sorento sold for $12,600, a staggering amount for a six-year-old car with 83,000 miles."
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Hey! We found an intervening cause!
Why not just blame the buyers. They're the ones jacking up the prices. /s
It's ironic that the people who think everything can be centrally managed (and they should be in charge) seem to have the least knowledge about how the economy works.
Simpler explanation: more gaslighting.
We had to buy my wife a new (to us) car a few months ago. It was looking like we were going to have to replace the transmission on the one she was driving. It would have cost more to replace the transmission than what KBB said the car was worth and it had over 100K miles on it. So, we trade it in and were credited around $5000 which I thought was pretty good. The dealership was pretty high end so I assumed that they would send the car off to auction and it would end up for sale in one of those dealerships that guarantee everyone gets credit. Well, my wife checked the dealership's website a few days later and our old car was being offered at $11,000 and it didn't stay on the website for very long.
I recently sold a pickup truck that I had driven for three years for what I paid for it. It was no creampuff, either.
Hmm, I have a car whose lease is almost up that is way under miles....
6 months ago I bought an extra around town little beater Honda 2007 CR-V with only 115k on the odometer. B+/A- condition. $3K cash. Just had an offer for it yesterday for $10K. Thanx but no thanx. Not letting it go even for triple what I paid for it.
This will drive inflation in a big way and fast. The dynamics of scarcity are the same here as with housing. How did people ever expect they could turn the music off for over two years —seriously shut or slow the global economy and its vast essential flows— and then magically turn it back on, without massive and still-emergent disruptions?
Wu Flu is the equivalent of a good-sized nuke strike with neutron bombs. Everything may look the same as before, but it’s not. Thanks, Fauxi!
It's great if you have an unused used car lying around but stinks for everyone else. But not to worry- the President's caregivers assure me the inflation that isn't happening is only temporary...
My car's on its last legs, but you can bet I'm doing what I can to squeeze a couple more years out of it. Not sure I can keep it running until a Republican is back in the White House.
Has anyone discussed the zoning law theory here yet? That guy from the twitterverse says the supply chain bottleneck should be blamed on zoning laws:
The ports are full of full shipping containers so there's no place in the ports to store empty shipping containers but the full shipping containers can't leave port because there's no available trucking chassis because zoning laws prohibit the trucking companies from stacking empty shipping containers more than two high in their transport lots so the transport companies are storing empty shipping containers on all the transport chassis. So, there's no available transport chassis to empty the ports of full shipping containers.
Or something like that...
...of course, that's not he only reason. The longshoreman's union has resisted automaton that would speed up the ports but cost some of them their phony baloney $175K a year jobs. States like CA are trying to eliminate contract work like truck driving...and then there's the mandates that people lose their jobs if they don't agree to a covid injection that neither prevents you from getting covid or stops you from spreading covid, while covid has an over 99 percent recovery rate, and that's with all the politicized resistance to covid therapies...
Enjoy your high priced new used car, though...
I bought a new 2020 Toyota 4Runner at the beginning of the pandemic for a little under $38K. The dealership was recently offering now a used 2017 4Runner for $5K more than I paid. I could probably get $48K for the truck now, but what would be the point of selling it?
The Toyota dealership has not had more than a few new cars on the lot for the past 9 months. They are selling them in advance with no bargaining. The supposed chip shortage has been quite a boon for the auto industry.
I will never have to buy another car again. Younger people are going to have to take out 7-10 year financing to afford a new car that will likely break down before it is paid off, unless they go with Toyota or Honda.
This a red flag to all those who think inflation is transitory. They forget the impact of public attitude. For many years now if people thought something was too expensive they would wait until the price came down or went on sale, keeping pressure on manufacturers and retailers to keep costs down. Now the public attitude is now I better buy it now before the price goes up, driving demand. This can be seen in many sectors such as homes, cars, and households goods as P&G increased prices across the board. Government stimulus will only make this worse. Biden may have not started all of this but his policies can surely aggravate the situation.
A local Audi store has its entire new-car inventory in the showroom. Two cars.
I asked the (only and lonely) salesman how long I would have to wait if I ordered a new one. Nine months. Not a joke.
The service department was busy. Probably the only thing keeping the doors open.
Manufacturers have been trying to eliminate "independent" dealers and sell direct (ala Tesla) for decades. This may finally do it.
I was in the market to buy a used car for one of my children. Looked at a 2004 Impala, 100k miles for 5k from a reputable new car dealership. 5K was my upper limit Decent enough deal according to bluebook. I like this dealer because they are pretty good at disclosure. When I investigated the vehicle, they suggested that about $3500 in repairs might needed to be done. I looked a t a few other cars that looked reasonably priced but passed on them as well. Ended up spending 12k on a 2011 Jeep patriot with 47000 miles. Not pleased that I busted my budget, big time, but looking at the feeding frenzy Althouse posted, I am now much more content with my purchase. I will get my money's worth out of it. In regards to earlier comments about 4Runners. I also noted that cars just like the Blogger spouse's 4runner is being listed for more than we paid 2.5 years ago for the one we have. We'll be keeping ours. 4Runners can last a long time.
I recently had a local dealership, which has a mostly-empty lot, sending me postcards exhorting me to sell them my truck. I would get top dollar. Top. Dollar!!
I was flabbergasted - you see, my truck is 25 years old. I'm wondering how desperate would you have to be to engage in this kind of mailing campaign.
“ Well, my wife checked the dealership's website a few days later and our old car was being offered at $11,000 and it didn't stay on the website for very long.”
But they replaced the transmission, right?
But they replaced the transmission, right?
I don't know for sure, but I suspect they did. As I said, it's a high end dealer. And I don't think you could have sold it without doing so, the transmission was making some noise and when it shifted it just didn't feel right. But I think it says something about the used car market that a high end dealer was willing to take a several years old, high mileage car with numerous dings on it, fix it up, and put it on their lot.
We have a new vehicle on order. We should get it probably sometime in March.
I hope the used to market is still crazy then so I can sell our old one at a good price.
Although it’s mildly annoying, I can afford to wait four or five months. Some people can’t.
“ Well, my wife checked the dealership's website a few days later and our old car was being offered at $11,000 and it didn't stay on the website for very long.”
But they replaced the transmission, right?
I am sure it was replaced. At dealer cost & labor, not retail.
Last time I had to replace a transmission (actually the only time), a brand new one cost about $3,000 installed. So $5000 (what was received in trade) + $3000 transmission ("retail" cost) = $8,000. Unfortunately, there may be a lag-time in current values showing up on the valuation sites.
My neighbor as an Escalade lease ending soon. It's a 'mom car' and they need a mom car.
The buyout is something like $45k but it's worth $65k now in this market.
My friend is a retired car dealer...he say dealers are making tons of money right now. They are able to add a $10k and up surcharge on many models.
Let's go Brandon!
I blame Mecum for any auto auction fever.
@Tim in Vermont: I'm in the same situation. I have a leased car which will be under mileage in 8 months when the lease expires. Unless things really change in the market, I'll be buying the vehicle then.
Stein's Law is relevant here: "If something cannot go on forever, it will stop."
At some point, people won't be able to afford new or used cars, and the prices will plummet back to earth. What I see in the future, like a year ahead tops, is huge amounts of demand destruction on the way. If you are buying a new car or used car that you dont' actually need right now, you are going to regret it a year or two from now.
I had a boat basically doing nothing but getting older in my barn. It's not a good thing for boats to go unused. It needed $4K in repairs, rubber goods go over time, and there was a seal problem from fishing line getting tangled in the props. I towed it to a boat dealer and there were people gathering around it before I could unhook it. It was not cherry either, 15 years old. Sold it for enough to cover the repairs and still get what it should have been worth in a normal economy. Very nice boat ended up costing me about a thousand dollars a year. I bought it about a year old, with ten hours on it, and the guy I bought it from took nearly as much depreciation as I did.
My boat mechanic friend assures me that they will get cheap again soon as people are forced to sell them as the economy tanks. I don't know, they can print a lot of money these days without a whole lot of effort. Anyway, I am not sure. I have an old fishing boat with a blown engine I was going to re-power, but it's not that easy to get new engines. My buddy also said that a couple of containers of Suzuki outboards fell off of a ship at sea, and that hasn't helped. I am not sure how plugged in he is to these things though, but when I hear things like "fell off of a truck" or ship, or whatever, I think organized crime.
The dollar is going to zero. That is what happens in corrupt 3rd world shit holes with Regimes that spend their time enriching themselves.
Bitcoin, land, and houses.
In that order.
It is quite possible that you are buying food with bullets and batteries soon.
Jeezum Crow, my car's trade in, per Kelly Blue Book, is higher than the lease buyout by maybe $6-8K! Thanks Althouse!
Stories like this should be amplified and repeated, preferably in the NYT or other things that credulous high-status folks read. The object is to get BlackRock to buy tens of thousands of used cars at ridiculous prices.
"It is quite possible that you are buying food with bullets and batteries soon."
My mother lived through Nazi occupation in Holland and she told us kids of a lady who made it through the war because she had a box of sewing needles she bartered one at a time.
I pulled the trigger on a hobby tractor a few months ago. I don't really "need" it. But it's very useful at my property. And the same supply issues are at play as in the car market. Hedging against inflation was one of the reasons I didn't put off the purchase.
Having some real things is a good hedge against a little craziness. But if the world gets really crazy, there's not much you can do to avoid the danger without a complete overhaul of your life, other than investing in your physical fitness and broadly becoming competent at staying alive.
My boat mechanic friend assures me that they will get cheap again soon as people are forced to sell them as the economy tanks.
Legend has it that the two happiest days in a boat owners life are (1) the day he buys the boat and (2) the day he sells the boat.
At one of my credit unions new auto loans range from 2.49% for a 24-60 month loan and 2.74% for 72 months. At the other one 1.79% for up to 36 months, 2.19 for 37-50.
These rates are well below the current inflation rate, which most serious people think is only going to go up for the rest of the Biden train wreck. Rates are not going to stay there.
If you can find a new car on the lot that you like, and you suspect you’ll be needing a replacement for your current vehicle in the next four years, you should get one now. If you don’t need to trade in your old one- don’t. In another year you’ll probably be able to sell it for more than the trade in value.
My brother bought a brand new 2012 model GMC Sierra quad-cab V8 4X4 kn early 2013 as a "last years model sale". He paid $26,000 for it. He traded it in 6 months ago, with 85000 miles for $23,000. Had he waited he might have got as mush as $30,000.
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