All kinds of crazy spikes in used-vehicle wholesale and retail markets topped out, but by only a tad.
By Wolf Richter for WOLF STREET.
Dissecting and reporting the nutty spike in used vehicle prices for the past 10 months has been quite a ride for me, having spent a decade working in the car business. I’d never before seen anything even remotely like it, with year-over-year price spikes of over 30%, leading to the crazy situation where some sought-after one-year-old used models sold for more than the new model, as people couldn’t buy the new model because it had sold out due to the semiconductor shortage.
But we may have finally seen peak nuttiness. Dealers and customers may be finally taking a deep breath. A month ago, I reiterated my gut feelings “that these crazy price spikes cannot continue for long, and some of this will eventually unwind, and thereby they sort-of fit the Fed’s definition of ‘temporary,’ but they won’t go back to where they had been.”
In its weekly auction index, J.D. Power noted that the price increases of used vehicles that sold at auction were softening in late May. Then, for the week ended June 20, it noted the first week-over-week price decline, after 24 weeks in a row of often hefty price increases.
About 80,000 vehicles were sold at auction that week, according to J.D. Power. That was down nearly 30% from the same week a year earlier and well below the average in April and May.
In its mid-June update, Manheim, the largest auto auction operator in the US and a unit of Cox Automotive, had reported that prices were up only a tad compared to May and had begun to weaken.
Today, Manheim reported that for all of June, its Used Vehicle Value Index actually ticked down 1.3% from May, the first month-to-month dip all year, but was still up 34% from June last year. This early evidence suggests that the spike in nuttiness may have gone as far as it’s going to go:
Pickup trucks were still the hottest price-spikers, but the year-over-year price spike of 49.5% in June, as mind-boggling as this still seems, was down from the 70% year-over-year spike in May, and the 78% year-over-year spike in April. These are just head-scratcher figures:
Sales volume also fell on the retail side. In June used vehicle retail sales fell to a seasonally adjusted annual rate (SAAR) of 21.3 million vehicles, down 7.8% year-over-year, and down 2.7% from May.
Supply, both retail and wholesale, continued to climb back toward normal levels. Retail supply at the end of June rose to 41 days, up from 38 days in May (44 days = normal); wholesale supply rose to 20 days in June, up from 19 days in May (23 days = normal).
This chart from the Cox Automotive quarterly conference call and presentation today shows used vehicle supply by week of each year. The big burst in 2020 from week 12 through 18 occurred during the lockdown in 2020 when sales volume collapsed. The yellow line, retail supply in 2021, shows how supply has been growing in recent months to end up in June just a tad below 2019 (gray line):
Used vehicle resale values over the past 10 months were another head-scratcher. They blew everything away. They surged across the board for all ages, with prices of newer vehicles surging the most. According to Cox Automotive, based on Manheim data, the average resale value of one-year-old (1 YO) vehicles surged by $6,718 year-to-date through week 26. Even the average resale value of 10 YO vehicles still jumped by $1,349:
In its presentation today, Cox Automotive also shed more light from a different angle on the curious phenomenon of low-mileage sought-after used vehicles suddenly retailing for more than their equivalent new models – as the new models were sold out due to the semiconductor shortage.
The chart below shows two indexes: the average transaction price (ATP) for new vehicles set at 100 for January 2012; and the unadjusted Manheim Used Vehicle Value Index, also set at 100 for January 2012. The ATP index had been rising slightly faster than the Used Vehicle Value Index until mid-2020, when the used vehicle prices began to spike.
And there’s another mind-blower: a spike in the average mileage on vehicles that rental car companies sold at auction.
Prior to 2020, rental fleets bought over 2 million new vehicles per year. But in 2020, as demand for airport rentals collapsed, rental companies defleeted by selling vehicles and by slashing orders for new vehicles. In 2021, when travel took off, and rental fleets needed cars, automakers got hit by the semiconductor shortage and prioritized high-profit retail sales over low-margin fleet sales. And rental fleets, short on vehicles, kept what they had much longer.
Rental fleets dispose some of their vehicles by selling them back to automakers under programs where the automaker is at risk for the resale value; and they dispose of the remaining vehicles by selling them at auctions or on their own retail lots. With these units, fleets carry the risk of resale value.
The mileage on these “at risk” rental units had been increasing for years. Then came the rental vehicle shortage of 2021, and the average mileage spiked. By May 2021, the average miles on at-risk units sold at auction had doubled year-over-year. But here too, the spike seems to have peaked: In June, it ticked down a smidgen to a still astronomical 86,888 miles
Vehicles are a discretionary purchase for most people. Most people can continue to drive what they now have for another year or two. They’re buying today because they want to buy. If they don’t want to buy, they can easily wait. And they did that massively during the Great Recession when vehicle sales collapsed and stayed low for years.
The kind of nuttiness that has transpired since last summer normally gets resolved long before it gets this far. Normally people go on a buyers’ strike, which ends the price spike before it gets started. It didn’t happen this time. Instead, dealers and retail customers jostled for position to pay ridiculous prices. But this may have finally gone as far as it’s going to go.
Going forward, lower prices are likely – but lower only from the crazy peak of the spike. It’s highly doubtful prices revert to anywhere near February 2020 levels. They will likely fall some, find a base that is still much higher than February 2020, and then move higher from there.
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How about adding $6 per gallon into the mix?
Data Point: Purchased a new higher end Subaru two years ago. Dealer calls me and sez I can trade it in a get a new same model one for only $4000.
I declined but you don’t see that too often.
“Going forward, lower prices are likely – but lower only from the crazy peak of the spike. It’s highly doubtful prices revert to anywhere near February 2020 levels.”
It think prices will revert back in January when the dealerships are stocked full of cars.
A growing percentage of Americans only buy used cars, because they are cheaper.
Right now, sedans and smaller cars are becoming less desired in America, partially because of the cars arms race and partially because of obesity problem.
It’s important to note that both GM and Ford are phasing out, nearly all non luxury sedans.
The fact that GM and Ford won’t be making many sedans (coupes and the like included) anymore, means that total demand would go down (due to cars arms race), but without new sedans from them, some used models (mainly bigger models) would have less competition and go up in price.
While Americans can just buy foreign sedans, used American sedans like the Impala will probably go up in price, and many to most small cars (especially non-American small cars) could go down in price. Used pick-ups and suvs could probably still go up for awhile. Suv’s will probably vary much more, by model.
Next few years, could be very up and down for used cars, and potentially by size.
Longer term (5+ years), possible recessions, fallout from work from home, self driving cars, people moving around, newer cars (the ones currently being made) potentially being more expensive to maintain, changing demographics and many other factors, make it impossible to predict.
Apparently, GM is discontinuing most luxury sedans too.
(someone else comment first. i wanna write but be in the back with the riff raff.
Wolf should auction off “first post” rights and then track prices depending on the article.
Artem, even better, he should issue a new crypto currency and require the auction bids for first post be tendered in Wolfcoin!
Artem, that IS interesting because i wouldn’t (and don’t) want the pressure of opening the show; i wanna come in when all the harder warm-up factual comments or trying to come up with most pithy succinct summary is done and CLOSE the show.
besides that’s when Wolf is busy on the next article and he doesn’t seem to mind me dancing on the bar so near to closing time.
i’m here because this article is about USED cars and big scary manly things with internal combustion engines (still) and greasy scary things that go BOOM— and thus, this is the only subject where Actual True Adult Time is hiding in plain sight:
the millennials, and other children, are only interested in cars via OTHERS driving them around in perpetuity.
and i don’t want to talk in front of the children anymore. they’ll have to stumble upon grown-up conversation and troll the alleyways for veracity the way we had to live our lives with ever-constant vigilance and the openness to happen upon our own Accidental-Pink Adult Moments in our own apartment building’s dumpsters or down alleys of Real Life Adventures.
i’ll be back here SUNDAY when all the falderal dies down of being early to comment in the Used Car News, and the lights are out and cold in the rush rush rush of what’s NEW!, but the tinsel is still magical yet, and Wolf is onto his Monday article.
yes. this is reverse gentrification. but where all the fun is SUPPOSED TO BE, remember?
(i know, i’m talking smack. making stuff up. that’s my JOB, though and why i’ll report on what’s next out here as i try to repopulate The Real World again offline).
i’m living an episode of Twilight Zone starring either Ruth Gordon or Ruth Buzzy but i suspect BOTH.
“Reverse gentrification” – purr-fect word, Kitten, to describe our current national plight. On a separate note, I do miss “Unamused”.
“…grown-up conversation and troll the alleyways…”
Kitten just admitted she’s a TROLL!!!
Supply is rising, because dealer lots are half empty, loaded with bad items
that don’t move.
I have lurked in these parts for a long time but this is only second post I have ever seen with complete sentences from Engel.
Quite the surprise. Probably won’t see one again for some time.
Way to jinx it, snake
Maybe the bot was upgraded to GPT-3.
its the price that
clears the market
even the junkyard is a market
Especially the truck side of new car stores.
Exception being Toyota [who by passed their JIT inventory control on critical computer chips required for vehicle assembly].
Curious notation: local Mopar mega store is full of late model Ford diesel pu’s on their used truck lot.
1) New car sales are down from 19M to 15.8M.
2) Used car sales are down from 23M to 21.3M.
3) US total car sales is huge : 19M + 23M = 42M/ annually.
4) US car market might be bigger than the one in China.
Somehow that has been bullish for new and used car company stock prices.
I guess Wall Street is forward thinking. LOL
5) Obama was right.
Are we talking about when he crushed thousands of perfectly fine cars that would have been purchased by lower income households just to stimulate people into being saddled with paying interest on a car loan?
Sometimes I can find a nugget of wisdom or sense from your posts, but this ain’t it.
crazyt-check. Can see another angle of it in terms of reducing the remaining numbers of hard-to-tune/maintain for air quality carbureted vehicles in the population at the time. (Sidebar-is it just me, or has the number of auto fires been increasing the last 25 years possibly due to the high-pressure electric fuel pumps/plumbing necessary for F.I. machinery? Sensitive to this as my maternal grandad perished in his brand-new ’62 Comet following a high speed rear end impact and gas tank fire-a design issue it appears that Ford didn’t adequately deal with until similar instances years later with the Pinto…not blaming Ford specifically for the current conflagrations i see, they seem to be well-spread among the manufacturers…).
may we all find a better day.
Good point about the apparent increase in auto fires 91:
Seen a bunch, and have used several of the extinguishers always kept at ready in our vehicles,,, fortunately, so far, none on our own cars and trucks, but always willing to stop and help,,,
Really suspect you are correct re increased fuel pump pressures and also the electric fuel pumps NOT turning off as fast as the mechanical ones of older vehicles.
Thanks for sharing your many good comments on here!
VVNV-thanks and back at’cha (especially for totin’ and knowing how to use extinguishers!) . Even if fuel pumps are cutout at impact, seems to me the high residual fuel pressure in the plumbing remains a fraught issue…
may we all find a better day.
Just watch the ETFs ( mentioned a day or two before) I am monitoring
on restaurants, hotels, airlines, cruise lines – all sloping to the south!
10y yield now is 1.297%. Bond mkt has spoken. Ignore it at your own financial risk! Reset has begun, but of course with some false up sticks, to suck more dip buyers!
(Been in the mkt since ’82)
Why would a reset result in lower bond yields?
In 2020 mortgage rates were the lowest mortgage rates ever recorded in the U.S.
Are low interest rates part of an asset bubble, or is inflation nothing new and should we expect more of it?
Why are unemployment rates so high?
6) Fred : Auto Inventory/ Sales ratio : the lowest ever, since the 1990’s.
That’s NEW vehicles, not used vehicles. Different ballgame. Semiconductor shortage.
I’ve got a 2016 single cab, F-150 Eco-boost with under 14,000 miles. It weighs only about 4,100 lbs, and, with 325hp, it does 0-60 in 5.2 seconds. I don’t need it, and my wife wants me to trade it in on the new base model 2-dr Bronco. Now I’m told that the dealer won’t have any until 2022, because of the chip shortage. When (if) the time comes, when the chip shortage has passed, there probably won’t be any dealer out there who will still pay stupid money for a used Ford truck.
I should sell it, now, anyway, but I hate to sell something that is in short supply. That’s what’s called a stupid business decision.
why is it a stupid decision to sell when the market is hot and hold the money to buy what you want when it’s available? i don’t get it.
“A”, you are correct. I agree that I’m making a stupid decision by not selling a vehicle I don’t care that much about, when the market is hot, just because other people want it.
Sell while the price is maxed out, then ride a bike until the Bronco’s are available.
This is a great time to sell a used truck. Maybe best time ever.
If you need it, keep it.
But if you don’t need it… See what you can get for it. Take it to a place like Carmax. They will give you a fixed price, take it or leave it. You have some time to think about it. That’s your base price. Then shop it to dealers and see what they will pay. If you get a surprisingly large amount of money for it, sell it.
That’s very good advice, and I will do just that. If I had really needed it, then it would have been driven more than 3,500 miles a year.
Let us know how it turns out. I’d love to know.
Following up on sell the truck/buy the Bronco
Here are the pros and cons.
Carmax offered me $23,200, and I paid about $24,000, including taxes and tags, when I bought it.
LIghtweight aluminum (4,100 lbs)
Averages around 25mpg on regular
Faster than a Raptor ( It’s a sleeper, 0-60 in 5.2 seconds)
Probably good for another 200,000 miles
One of the few vehicles that doesn’t hurt my back when I drive it.
I already own it.
I’m a crappy driver, and, unless I get a topper, I can’t gauge where the back end is.
Only a matter of time before I back into another car
Without a topper (probably costs over $2,000), it’s impractical to haul groceries.
My wife wants a new 2-door Bronco and says I don’t need the truck (still have the ’97 Expedition I bought new)
New 2-door Bronco positives:
Very cool looking
4-wheel driving for driving on the beach
Only 173″ long; much easier to park and drive
7-speed manual trans
Rated better than a Wrangler
will cost about $9,000 more unless selling over MSRP
None to test drive, and probably can’t get one until 2021
Side collision deathtrap
Extra cost for sound insulation, because very loud road noise over 40mph
2.3 engine nothing to write home about
Giant tires, not fun to get in and out of
But, to repeat, wife loves the image (it will be her vehicle), and IT IS cool looking
Annoying to no end – we’re stuck with much desired manual transmissions only on low end models. Have it on Subaru 2 liter, but 2.5 liter forced to a go-kart belt drive, your Bronco 4 cyl is good, but none on Bronco 6 cylinder. Here I sit today with a $$$$ bill for our 2008 car with 53,00 miles and rotting tranny cooling lines. What we want is completely irrelevant and what’s provided is completely detached from what we need.
Dig a little deeper, rich. The new Bronco shortage has nothing to do with the chip shortage. You will also find that odds of you finding a 2022 on the lot when the time comes will be slim to none.
From Road and Track Magazine:
“Ford Bronco Production Will Reportedly Temporarily Shut Down Due to Global Chip Shortage
Production of Ford’s most exciting new product in years is coming to a brief halt.”
From CNET Road/Show:
“Ford has been forced to halt production of the brand-new Bronco SUV due to supply issues stemming from the global semiconductor shortage. The shortage has also interrupted production of other Ford models like F-150, according to a report published Wednesday by The Street.
Just as Bronco production was starting to get up to speed, things are being forced to grind to a halt at the plant in Wayne, Michigan, which also produces the Ranger pickup. Specifically, Ford will close the factory for the weeks of July 5 and July 25, Bloomberg confirmed Wednesday.”
How much deeper do I have to dig?
I’ve done more than my share of tune-ups on cars and motorcycles with points and condensers. My Triumph Trident had 3 of each. Setting the timing with a timing light is a real pain. I’ve also spent many hours trying to get carburetors jetted just right.
Electronic ignition and electronic fuel injection are essential.
As far as I’m concerned, Everything else can be analog.
US500 Futures weekly (not over) : inside bar, red.
People don’t want to hear TA bs.
Me, July 3:
FYI in my neck of the woods, used car prices are decreasing and time-’til-sold is increasing. Several used Camrys for sale at excellent prices, days past they sold within hours. The beginning…
Things may come down some but I don’t see how they come down much given all the free printed money everywhere. This is simplistic, but if the whole economy was one lousy used truck that cost 20k a year ago and they printed another 10000 pieces of paper, wouldn’t that lousy truck be 30k now? I know, simplistic, but this funny money isn’t just gonna go away.
Ultimately, the Fed is going to have to start removing this cash from circulation, or it will have no ability during the next crisis.
Correct. That’s called cryptocurrencies. Prices will go through the roof for most cryptos in coming years.
A friend at work had an interesting story. Her daughter is still not working as she receives more in UE then she made working. And what did the daughter due with their new found riches(while unemployed)? Bought a car! Seriously……
Obviously this is just one person, but who knows how many more are so financially challenged.
Pretty much what they were all doing – livin’ large. That’s why, short of more stimmies, there’s a major crash coming in durable goods purchases.
Yep. I think most have it wrong. Wealth affect mainly pulls things forward. QE pulls things forward. If you are retired and dividend payers pay 3% and Bonds pay 2% with inflation at 4% you aren’t very rich even if your account is $1million.
I know and have read a lot of stories like that Dave.
For many young single people, they see the Government has their back. So if things stay bad, the free stimy money keeps coming. So go ahead and keep spending. If the economy keeps getting better and the stimy money ends, then just go get a job as in theory, the economy is good and jobs are aplenty.
I know of young single unemployed people the past year who bought cars, computers, and boob jobs.
They are not that afraid.
ru82-might be said that they have ‘timed the government market’?
may we all find a better day.
It seems like the entire market is based on technicals. Fundamentals are the long term measurement. VWAP, 200ma, 50ma…blah!
The eco boost F150 sounds nice. You win either way by selling or holding.
The potential for many people being upside down on a car bubble purchase is interesting. The dealers are probably playing “hot potato” right now?
Here is a fun point from the used car market.
Two years ago I bought a used FIAT 500 electric from a dealer here in Seattle. Car had sat for almost a year. Had come up from California and needed a new starter battery, but was in good shape with 20k on the dial. With price reductions and lack of a sales tax for e-vehicles here in the State, probably saved 2k on the 10k sale.
Sitting at a light today, looked over and the guy, in his 60’s, was driving the SAME car, from the same dealer.
He probably paid more than 2k than I did.
Secret is out though. A used electric car, no matter how short the range, is the best thing you can have. Monthly operating costs are less than half of an ICE.
I have had the car for two years. No Repairs since I got the starter battery replaced two years ago, except some curbed wheels. No gas station stops means I’m saving about 50 a month, gas versus electricity. Operating costs are thousands less than the fleet of Volvos I had, and went through, over the last thirty years. Probably forced us into BK now that I think about it.
Our gas powered tank (2009 Volvo) sits mostly unused.
Kept trying to get the guy to roll down this window to tell me about his electric car. He assiduously kept his gaze that other way at each light. I must look like a psycho:)
But there’s the rub. You still keep your gas car in case you need to evacuate or do something else which requires driving long distances without a guarantee you can find a charging station.
Once we have enough charging stations and they’re rapid enough that people are confident enough to get rid of the gas car, then ICE will be on a rapid downward spiral
LOTS of charging stations on the West Cost Thousands in California alone. They’re everywhere. There are more charging stations than gas stations in San Francisco, for example.
You can look them up here for the US
The lines of green dots are highways through thinly populated areas in Nevada, Utah, etc.
Yep, but I live in South Florida, and wouldn’t want to take the chance if I had to evacuate in a hurry that I could find one that didn’t have a really long wait.
I had an electric car for a while, and loved it, but wouldn’t rely on it to be my only car just yet.
Though you are clearly on the right side of the long term Gaia healthy program indicated for our human brothers and sisters of all ages and gender possibilities, ( 32 apparently at this point read recently ) the fact is that in any kind of serious SHTF situation at this point because of the apparent lack of security/fragility of ”the grid”…
The huge and growing electrical grid of USA will be the very first thing to ”go down” either by EMP from the sun, IMHO the most likely, or by bad actors of any and every sort, as we have recently seen several times this year alone.
In that case, many ‘gas stations’ AKA petrol fueling facilities will be up and running for at least a ”short time” ,,which time is not in any general way knowable in advance.
Almost all the truck stops and some gas stations, have back up generators, ( and if any new fed and state and local law is needed, the requirement of ALL gas stations to have enough generator and back ups to be able to pump out their fuel tanks should take priority ASAP!)
That’s a very simple equation, and even though it should be based on full fuel tanks, even some margin of that, with the balance to be pumped out by manual pumps should suffice for now.
C’mon Wolfers,,, put your creativity and experience,,, long and longer experience from what I read on here, to WORK and let’s have a serious series of suggestions to deal with the obvious and very serious challenges we are currently facing… with the caveat to respect Wolf’s declared intent to keep politics out of our suggestions, comments, etc..
Case has been made here that the political puppets on both and every side(s) are all on the same team against WE the Peons. (Thanks UnAmused! )
Having known a bunch, I really didn’t think so, but it was many years ago that I knew them – all of them down to earth folks with a ton of heart,,, and, even then, very thick skin.
With an EV, you top it off every night by plugging it in when it’s parked in your garage. This topping off is quick because on a regular commute, you might only drive 30 miles a day. So you nearly always have a vehicle that is fully or nearly fully charged, in case of an emergency. Depending on range, that will take you 200 to 350 miles.
You don’t top off your ICE vehicle every day. And so you’ll have to get gas when the panic has set in and everyone is trying to fill up their ICE vehicles. So don’t buy an EV, and just wait in the gas line before you have to get out.
Also, it has been learned the hard way that you cannot evacuate a big city like Houston. There is not enough highway capacity to carry that many people all in the same direction.
Also, when the power goes out for a long time, everything goes out and everything closes, and payment systems shut down, and you cannot buy gas even if the gas station has power backup. Just ask Texans.
On the local news last night people are ditching cars and buying E bikes for local commutes. No provincial sales tax on the purchase and gas is around $1.70/liter these days. Lots of incentive for sure.
E bikes are pretty dangerous. They are like a small motorcycle with no horsepower. Maybe in communities where there is limited traffic they are safer, but in congested cities and suburbs, they are not ideal. A used, small electric car has more utility and is safer. Something like the Fiat 500 like Kurt talks about above or a Nissan Leaf would be good choices.
I’m waiting for the States/Municipalities to realize E Bikes are just motorcycles and require the same level of training, obedience to traffic laws, and taxes.
It’s going to happen.
I have an ebike. Ariel Rider M class. Love it! Take it everywhere. Live in Sacramento. Have been riding bikes since childhood. Hit 72 years old. The hills and wind got a little tougher. Great exercise depending on your pedal assist level. Would take it shopping, but they have no safe parking. Crazy to take 4000 lb. car for 10 lbs. groceries.
Not safe due to theft!
If you don’t want/have to worry about
where the used batteries end up
how polluting is the power source
how the mining for the battery raw materials is done
how the money for EV discount comes from
how to charge the car during power cuts, etc
then it’s an awesome purchase.
Coworker bought a used Prius. It’s several years old. After two years of ownership, the battery died. New battery replacement ~$5000 with a multi-year warranty. Used battery about half the price, but no warranty. Even though the Prius has a gasoline engine, you cannot drive it with a dead battery. Point: not enough data to know the true cost of ownership for an EV.
In Europe small cars are all the rage. Good luck finding a well-looked after Opel Adam, Suzuki Ignis or Citroën C1. The Fiat 500 tops as the most appreciating used car: 2-3 year old examples can sell for 110-120% of new price.
Operating cost on SUVs and Trucks are becoming prohibitive. That’s why people are hanging to their old cars/SUVs.
One new wheel on some of these SUVs are over 1k, EACH.
A new set of wheels on my little car is just over $400
1) Manheim : pickup trucks are up 50%, people infatuate with them.
2) US gov debt $28T.
3) The best toll to deflate the pile of debt is stealthy inflation.
4) US gov imposed an embargo on the (US !!!) oil sector to cause inflation.
5) Mix taxes and WTI and u get high prices in gas stations.
6) CASY, MUSA and seven eleven selling junk food and Fill-A-tank are doing well, because pickup truck owners are coming every few days.
I buy 3/4 and 1 ton trucks every week all over the country for my dealerships. Condition is going down quickly but not price. I’m fearing a squeeze in availability not a drop in prices.
Hee, hee…makes me wonder what words Cal Worthington would be singin’ these days….If you’re worried you can’t get what you need, See the guy that hauls ’em in with such speed, You won’t have to lose your ass, And the tank is full ‘o gas, Go see Cal, Go see Cal, Go see Cal!
Buy-what would Cal be presenting as his animal mascot these days?
may we all find a better day.
Weasels? We seem to have an abundance of them these days.
“…hi, this is Cal Worthington and my dog (weasel) Spot…”, i like it!
may we all find a better day.
I will never understand what kind of stupid person would overpay in such gross fashion for a used vehicle.
Send checks to Millennial YOLO’s and of course used car sales skyrocket
Give money to people who need the money and they will spend it. However, money given to people who don’t need it, won’t be spent. This is why all those tax cuts over the last 40 years resulted in so little impact on the economy (job growth, inflation, or otherwise). Keynes was right about demand side economics.
Just giving money to people is stupid beyond words.
Wolf, the reason prices are going to drop is there’s no more “free” money. Everybody spent that check.
Yes, people keep cars longer, but that requires the owners to care for a vehicle.
There is a good size segment of the population that trash their cars on a regular basis. I have them in my own family. The cars never see an oil change or the inside of car wash. The back seat is steeped in garbage.
This segment of the population MUST buy a new, or new “used” car when their trashed one gives up the ghost.
They are the ones stuck buying at these prices. When inventory comes online to satisfy their portion of car buying demand that will be the end.
Credit card usage moving up again.
Muppets are so predictable.
Used vehicles, housing, commodities….
all have the same issues caused mostly by the Fed…
It is difficult to ascertain what money (the dollar) is worth.
The metrics are convoluted and distorted. CPI PCE curious….inflation 5% yet Fed funds 0, Ten Yr 1.3, 30 yr mortgages 2.9%…
this is an inverted arrangement conducted by committee. Yet, the discussion is of economic forces, when the real force is decision making by the unelected and unaccountable, and seemingly unlimited resources (digital minting).
If you want to see real time what inflation and demand have done to “Used” car and truck pricing start following BaT. The trend has certainly changed for what is now deemed in demand. ??
“we may have finally seen peak nuttiness.”
Now that statement is an open challenge.
Enter the EU Commission.
BMW & VW together just got hit with the EU’s biggest fine for anti-competitive behaviour.
They had agreed secretly to install only the absolute minimum of emission standards required by the EU.
Mercedes Benz, the good guys? Nope! They turned ‘grass’ and escaped a fine for assisting the investigation, which started after the earlier World emission con.
That’s only Germany, imagine how cut-throat it must all be on a global scale.
Make sure you check your EV’s brochure claims closely.
No shortage of people in florida willing to pay $15-20 and up for a vehicle with over 200K. Cars can’t even make to the detailer before they are sold. They are buying anything with no end in sight.
The computer chip shortage is probably the ultimate cause of all this. The resulting lack of new car supply causes greater demand for used cars, which drives up their prices.
Dear Anyone Who’s Still Here or Came Back!–
i said i’d be back on sunday, as i figured the kids would be in bed for school by now, and we can lurk creepily among the aisles of the complexities of Real Life and look at each other with telepathic dirty jokes. /
coming back to a dead comment thread on used cars is my practice for going back to the ’90s, for that is what i have decided to do, and have also decided to announce here, in the hopes that only a fraction of my friends here will notice this tentative line i’ve drawn in going any further into this future we’re currently living in.
Branson’s making a break for it, and the rest of the billionaires are sure to follow, using the rest of us as bio fuel. yes. we’re living another Twilight Zone episode but “To Serve Man” was at least about savoring us and who we are.
as in: we got taken out to dinner first. we’ve had years of marbling and massaging.
before i acquiesce to my complete obsolescence, i wanted to thank Wolf, Aqius, LeClerc, Phoenix, HowNow, Anthony A., Swamp Creature (say hi to Mrs Swamp Creature!), Eugene, and John Galt for having my back or merely acknowledging my existence.
it so floored me, as i don’t expect that sort of thing around these here San Francisco parts. thank you. in fact, i was speechless for DAYS about it. i felt all shy. because even though i SAY i write like this even if no one’s there, it doesn’t mean i don’t get tons of vertigo and joy when anyone answers me BACK.
so thanks for having my back on the proverbial Wolfstreet playground.
that actually contributed to my further audacity in trying to wean my work and my words offline where i’ve long been censored, deleted, or yes i suppose, Raging Texan—considered a troll?—- (save for HERE), and starting a tiny, obscure, irrelevant paper pink ZINE and sending out an edition of 250 copies max.
i didn’t know i was denying being a troll or that any trollery i do was in contention. “troll” seems so droll though, doesn’t it? it’s too passive for what i do and who i try to be: EVIL.
in fact, whenever i mention my megalomanical idea of trying to re-seed the creative joyful life in REAL LIFE, yesterday he came home from working outside all day and said of my fluffy ideas: “Leos have to get all megalomaniacal and say ‘i’m gonna make god my bitch! There’s no doubt Satan was a leo.”
that said, James also said you were brilliant for not listening to me, Wolf, when i try to push you into the thankless job of being a megamedia mogul for real and starting tangential companies.
i was just saying: “it’s the only way he’ll have anyone left to talk to when they turn the rest of us into biofuel.”
anyhow, i’m already practicing enjoying my even more obscure irrelevance by posting–closing out– the end of a Used Car Comment Thread.
i want to go back. i don’t like this future where you can’t even get hand crank windows and your car can lock you inside and not let you out until you talk to someone in a satellite.
i’m going back to the ’90s.
i’ll quite literally and actually in the real true archaic sense of the word, i will send you a postcard from the past.
so that’s my big business idea that i got after trolling, yes, trolling these comments all this time. this is the best i can come up with. when Branson goes high i go black and pink xerox with the freedom to say what i want via the U.S. Postal Service.
I used to joke that i was a pornographer to remind myself of my personal alliance and gratitude for what Larry Flynt and Howl and the likes did for perverted twisted dirty nasty curious questioning doubtful disgusting minds like mine.
but my future (past) now relies on the bouquet of freedoms they left for me as a woman who’s going to be my own tiny version of Hugh Hefner. except now that tits and hairless rimming are free for the asking for anyone, it’s radical to be nakedly real vulnerable emotional and clueless.
i’m clueless. i feel like i’m the only one trying to repopulate The Real so that we’re not dependent upon tech for everything ever again. but i know i’m not the only one.
so that’s where i’m going: backwards.
thanks for letting me post here. when i first got here, it even smelled different. i feel like a woman who crashed a men’s sauna and waved her chocha around, and not in a good way. in the most annoying leaky estrogen way possible.
i didn’t mean any disrespect posting in the car section.
i’m trying to find ways of hiding in plain sight.
— you mentioned David Graeber’s “BS Jobs,” but i started to read his book, “The Utopia of Rules: On Technology, Stupidity, and the Secret Joys of Bureaucracy” to understand how we got here, and thanks for the tip. i dig this guy’s writing and vantage point. thank you because i’m always desperate for a writer who can give me insights on how we got here and where we are. i breathe this water, swim in this air; i can’t get outside and “see” a thing.
i still don’t understand why the Fed is buying mortgage backed securities in the first place as i barely understand the existence and powers of the Fed and what all this has long meant this gold standard being over since ’71 thing and Modern Monetary Theory and oh my…
have a good week.
and thanks those of you who remembered and came back. (smile)
it’s these little kisses on the cheek that are making me dare to go back to paper…
i sent my friend a practice envelope with glitter and she waited all week to open it because she wanted to not ruin it. i reminded her about the beauty of LETTER OPENERS and how neatly they slit into envelopes.
stay tuned for more backwardness. / hey, ain’t hardly anyone flinging themselves into the future willingly. this seemed the only sane rational response. to start my own underground of ONE.
i’m tired of waiting for other people. so what they make sense. this doesn’t. pray tell: how long shall–and CAN–the twain meet?
when you all get some cars with roll down windows again, then i’ll listen to what you have to say.
until then, i’m calling my new pink zines via U.S. Mail: “Show a Little Pink.”
can you believe it was even available as a URL last year?… shows you that no one knows what it even means in an era where you no longer have to even ask.
have a good week.
Oh! Dear 91B20 1stCav (AUS)–
i wanted to actually say your comments of love always hit me like a wrecking ball of affection so thank you so much especially for seeing and getting what i’m trying to do.
Dear Sir, also i want to thank YOU for Your Service because even though you served elsewhere, i think when you SERVE you put that honor and heart –all that empathy and strength from all that discipline and struggle– out into the world and it can be the opposite of combat.
but you Warriors know exactly what i’m talking about. the “complexity of life” thing.
anyhow, thank you. the respect of warriors means the world to me. when my own pops who was in the air force in Korea looked at ME with respect for taking it out there, i felt puffed up and big. pain was transmuted into pride …dare i say, even pleasure!
who needs to be “told” one is loved in words when you get THAT look. it’s more than trite words and my leaky estrogen of neeeeed.
there’s that complicated life thing again.
thank you, dear Sir! / i miss my pops a whole lot so any up nods mean the world to me these days especially. we never grow up, do we?
thank, you Mr. 91B20 1stCav (AUS).
and yes… we will find a better day. it’s a miraculous world. thank you.
Kitten-i am VERY humbled, honored, and my cheeks are a bit damp. You are just as much warrior as i ever was, and who i still struggle to be in memory of those i couldn’t help make the journey home to a country where many, if not most, have free minds&hearts such as yours.
Keep on keepin’ on my dear, and yes, despite the contrary i may present in Wolf’s indulgent print of my own aged, never-informed-enough and curmudgeonly viewpoints, we WILL find that better day…