By brand & segment: Big incentives or interest-rate buydowns for pickups. But many Kia, Toyota, and Honda models essentially out of stock.
By Wolf Richter for WOLF STREET.
Inventories of new vehicles at the end of September rose to 1.23 million vehicles, still down by 62% – or by 2.13 million vehicles! – from September 2019, where there were 3.45 million vehicles in inventory, according to data from Cox Automotive.
But it’s not across the board: Some brands offering vehicles with high fuel economy are essentially out of stock (particularly Kia, Toyota, and Honda); other brands are amply stocked or overstocked, particularly those focused on full-size trucks and SUVs (Ram and Jeep). At Ford, Chevy, Chrysler, and Dodge dealers, supply is normalizing. There are now big discounts off MSRP or interest-rate buydowns being offered on pickup trucks. Gone are most of the obnoxious addendum stickers on top of MSRP.
Supply at the end of September ticked up to 42 days – enough inventory in stock and in transit to support 42 days of sales. This is still very low, but up from the 30-day range last summer. In the year 2019, supply averaged 89 days, and incentives were big, and there were lots of deals to be had back then. Now, overall supply is still far from those 2019 levels, but inventories of some truck models are climbing back into that range.
Overall sales are still terrible – back in the range where they’d first been in the 1970s – handicapped by the shortages across many models, and now perhaps also by sky-high prices. Total new-vehicle sales in September dipped to 1.16 million vehicles, according to data from the Bureau of Economic Analysis. The seasonally adjusted annual rate of sales in September was down by 21.6% from September 2019.
By brand, from shortages to oversupply.
As a result of the spectacular price spike of gasoline this year, demand for fuel efficient vehicles surged, which caught automakers by total surprise. Supply chains are long and complex, and production plans are decided way in advance, and production cannot be changed on the spot to accommodate such a sudden change in consumer preferences.
In addition, in a move that will go down in automotive history as the best-ever act of Wall Street genius, US brands killed off their smaller fuel-efficient car models in recent years because they couldn’t make enough money on them. Wall Street imposed short-termism had won the day. US automakers, one after the other, fell into the trap. Now they have nothing to sell to those customers. Import brands, whose vehicles are mostly assembled in the US and Mexico, are raking it in.
So now the most fuel-efficient vehicles have essentially sold out at dealers. Brands with somewhere near “20 days’ supply” (such as Kia) means that you will find nearly nothing on many dealer lots, and most of the vehicles they’re showing in “inventory” on their websites are actually in transit, and many of them have already been sold before they arrive on the lot.
The five brands with the tightest supply – between 19 days and 27 days – are all “import” brands. But they assemble many of their models at plants in the US and Mexico with components that are manufactured in the US, Mexico, Canada, China, Thailand, Japan, Korea, etc.
Kia has the least supply: 19.1 days in September, roughly unchanged from August. This means it will be tough to walk into your local dealer and pick out a new vehicle that sits on the lot, and drive home with it.
Tesla doesn’t have dealers, and so doesn’t have inventory on dealer lots, because back in the day when EVs were still ridiculed, Tesla managed to make deals with numerous states to be exempt from their state franchise laws and sell directly to consumers. Any inventory it has is its own inventory. It doesn’t disclose US sales, and doesn’t disclose its own vehicle inventories. And so Tesla is not on the list.
Fiat and Alfa Romeo (Stellantis brands) are also not on the list because sales in the US are minuscule, and days’ supply is so huge – 120 days for Alphas and 130 days for Fiats – that it would distort the chart. And overall in the US, they just don’t matter.
Volvo is overstocked with 87.5 days’ supply. It is owned by Chinese automaker Geely, and some of its models are made in China. This is the most overstocked brand on this list (data via Cox Automotive):
As you can see in the chart above, the US brands have now at least adequate supply – though some models may still be in short supply. Ram and Jeep are overstocked. Ram started piling on big incentives a while back, and has managed to reduce its supply by three days over the past month, to 79.6 days. Dodge reduced its supply by 12.9 days month-over-month, to 66 days, which is ample. Supply at Chevy dealers rose by 4.5 days month-over-month, to 48.4 days, adequate. Supply at Ford dealers jumped by 7 days to 57.1 days; and at GMC dealers by 12.4 days, to 57.8 days, both normalizing.
The 5 segments with big shortages.
Five of 23 major segments had less than 30 days’ supply. This is an improvement from August, when seven segments had less than 30 days’ supply. At these levels of supply, most of vehicles in “inventory” on dealer websites are either in transit or have already been pre-sold.
Four of these five segments are composed of relatively fuel-efficient vehicles. The outlier is the segment of high-performance cars (22.1 days’ supply). With an average price tag of $113,770, per Cox Automotive, they’re not mass-market vehicles and sell in only relatively small volume.
|Overall Rank||Segments with biggest shortages||Day’s supply|
|1||High Performance Car||22.1|
The 11 segments with tight to adequate supply.
In another sign of improvement, there are now 11 segments with supply in the 30-50-day range, so from tight to adequate, up from nine segments in August.
This group spans a broad range of segments. Compact cars have the tightest supply in this group, and getting tighter: 31.9 days in September, down from 34.2 days in August, amid strong demand.
Sports cars are not the same as “high-performance cars.” Sports cars – which include cars such as the Mazda MX-5 – have an average listing price of $47,979, according to Cox Automotive, just a tad above the overall average new vehicle listing price ($46,294).
|Overall Rank||Segments with tight to adequate supply||Day’s supply|
|7||Luxury Full-size SUV/Crossover||36.0|
|10||Mid-size Pickup Truck||39.9|
|13||Entry-level Luxury Car||41.4|
|15||Luxury Mid-size SUV/Crossover||43.6|
The 7 segments with enough or more-than-enough supply.
The big feature here are full-size pickup trucks – a huge, super-popular, and incredibly profitable segment in the US. Americans just love to pay large amounts of money for pickup trucks, voluntarily giving automakers big-fat profit margins. Last year, if you could even find full-size trucks on dealer lots, they often came with crazy and obnoxious addendum stickers on top of MSRP. No one should ever buy at those prices. A buyers’ strike last year would have stopped those shenanigans. But that didn’t happen. Last year, people who wanted to buy a truck just paid whatever as the inflation mindset had gotten a hold of them, and with customers paying whatever, dealers charged whatever.
This era is now over. The segment of full-size trucks is now the segment with the second largest supply with 64.5 days, up from 59.2 days in August.
In another sign of improving inventories, in September there were seven segments in this category of 50+ days’ supply, up from five segments in August.
|Overall Rank||Segments with enough or more-than-enough supply||Day’s supply|
|19||Luxury Compact SUV/Crossover||54.3|
|21||High-end Luxury Car||62.6|
|22||Full-size Pickup Truck||64.5|
|23||Luxury Subcompact SUV/Crossover||70.0|
Discounts and interest-rate buydowns are back.
I just checked around at dealers in the San Francisco Bay Area. Incentive and interest-rate buydowns may differ from state to state, or by region. So here are a couple of examples.
Ford dealers in the Bay Area are now offering interest-rate buydowns to 1.9% APR on 60-month loans for 2022 F-150s, the same dealers that had slapped $5,000+ in addendum stickers on these trucks last year.
And at Ram, big discounts replace the obnoxious addendum stickers:
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Whats with the low stock of BMW’s? I drove by a BMW dealer on my way home today and the lot was crowded with used cars but not a BMW to be seen. Sure they some cars that fall in to the ” high performance” category but many of them are just midsize to large Suv’s.
Not sure if that’s still a problem, but BMW ran into big supply issues of wiring harnesses (in addition to chips) which were made in Ukraine, and the factory shut down at least temporarily.
Same here. The BMW dealer a mile from my house has an almost empty lot where new stock was always parked. The used lot is chock full of Ford and GM pickups and SUV’s of various makes.
As Wolf speculates above, it’s probably a manufacturing supply issue related to wiring harnesses and other parts.
I just hit the website of Penske’s BMW dealership on the south side of the Twin Cities. There are 148 pre-owned vehicles in stock. But the site shows zero, repeat zero, new BMW products of any type in stock.
Two 2023 M4 Competition xDrive convertibles, for $102k & $103k, are “In Production” in their “New Vehicle” section. That’s it for the M4 at the dealership’s inventory in new models.
I would guess that most people in Minnesota would not buy a convertible M4 in late October unless they winter in AZ, TX or FL — as many do for tax reasons — and weather reasons. As Anthony A. commented a while ago, license tabs and vehicle taxes are a hell of a lot less in Texas. If you winter in Texas, buy the car there too (if you can?).
The BMW SUVs are all built in upstate South Carolina and exported world-wide. A recent article said that BMW was having to fly in just-in-time parts from all over the world, and had prioritized the SUV models over any others models that are built elsewhere.
Indeed just over 257,000 BMWs were exported from their plant in Spartanburg South Carolina in 2021 with a value just over $10 billion.
The author obviously lives in import loving, California. American brands that sell full size pickups need to have a bigger variety of those trucks on their lots because the market demands it. Not everyone wants a short bed 6 cylinder 2wd. But if the customer is a flag burner that only considers import sedans from say,toyota or honda? They probably have 2 versions on their lots. And let’s remember where the profit goes when buying an import brand….it isn’t here. It’s goes back to the home country. GM sells a lot of vehicles in China. But profit comes back here. You think Toyota is putting it’s money in an American bank? Try again.
“The author obviously lives in import loving, California.”
Not sure what you mean. California is an EXPORT power house, from gasoline to nuts, including all kinds of high-tech stuff. Teslas are made in California and are very popular here. And Californians drive what everyone else is driving: “import” models made in the USA or Mexico, US models made in Mexico and China (i.e. Buick Envision). US models made in the USA. And and some “import” models made overseas.
Saw my first BMW X7 50i on the way home today………..
It was between a Porsche Cayman and a Mercedes AMG Coupe.
Must have hit the ‘rich wives going to lunch” crowd……….
The Porsche driver must have felt out of place.
This has been repeated at least four times since the 70s oil embargo.
They are not hiring the best…
“In addition, in a move that will go down in automotive history as the best-ever act of Wall Street genius, US brands killed off their smaller fuel-efficient car models in recent years because they couldn’t make enough money on them….Import brands, whose vehicles are mostly assembled in the US and Mexico, are raking it in.
Dodge is trying to get back into the party with the Hornet coming out next year. I guess we’ll see if it’s too late to make an impact.
These people ever heard of a company called Hudson? What’s next, the Toyota Edsel?
Haha…..I did my driver’s license driving test on a Hudson Hornet in 1961. Dodge?
“It’s difficult to make predictions, especially about the future.” -Yogi
The fad-motivated public and the oil market can turn on a dime, but the car business takes longer. This IS like the ’70s all over again.
Driving huge $100K pickup trucks to pick up the groceries just laid an egg.
But all the cars look the same now so all they have to do is drag out the old tooling (hopefully they saved it if they’ve learned their lesson), tart them up a bit, and make little cars again.
Kind of wonder if top is in for 1/2 ton glamour trucks with the EV models. It’s kind of silly if you are concerned about environment to be riding around alone in 6,000 lb. brick shaped vehicle unless you need one for your duties. Weight, shape and tires are the big three I think for physics of getting from point a to point b.
Not hiring the best? Well, here’s Arizona Slim with a little story from back in the day:
During the late 1970s, I was a student at the University of Michigan in Ann Arbor. This era coincided with the start of the long downhill slide for the American auto industry.
I had no interest in going to work for Ford, GM, or Chrysler, and I wasn’t the only one. There was a striking lack of interest among my classmates.
The really bright and talented kids — from a technological and engineering standpoint — were most interested in a relatively new industry. At the time, that industry was simply called “computers.”
It would have been so much better if these corrections started 3 to 6 months back.
The administration trusted Powell over the likes of Powell and now we may have a terrible hangover on the night of 11/9.
Correction: over the likes of Wolf.
Wonder if Powell can be sacked if Dems lose both House and Senate? I think he would definitely have support from Republicans for screwing administration, but will it be enoughto save him?
Can Janet change rules to buy treasuries directly, so that Fed can be removed from equation and all financial powers are consolidated with treasury.
The only benefit of getting Fed to buy debt was that assets could be inflated without increasing CPI. That relationship is no longer valid and now any printing via Fed / govt is increasing CPI. So, can we not merge Fed balance sheet with treasury?
To remove a member of the Board of Governors, … has to have a reason—a “cause,” to quote the statute—a term that courts have historically interpreted as requiring “inefficiency, neglect of duty, or malfeasance in office.” Policy differences are probably not enough justification, but the Supreme Court could ultimately decide that question differently. If it did, that would represent one of the biggest changes in administrative law in the United States in 80 years, so don’t count on it.
The statute says nothing, however, about whether the President can “fire” the Board chair, effectively demoting him to being just one of the other governors. Other presidents have concluded that they lacked that authority, and there is good reason to think they were right. But we just don’t know: it’s legally uncertain.
Front running stock trades in advance of meetings should qualify, no?
Wouldn’t failure to maintain inflation at 2% qualify as incompetency / ineffeciency / neglect of duty?
“Can Janet change rules to buy treasuries directly, so that Fed can be removed from equation and all financial powers are consolidated with treasury”
You misinterpreted a headline. The US Treasury Dept. can get cash to pay for anything in only two ways:
– from taxes –
from selling bonds.
Tax revenues are already not enough to pay for outlays. So any bond-buybacks would have to be funded with new bond sales. And that’s exactly what they talked about in that meeting: replacing less traded older bonds with more easily traded new bonds. ZERO to do with QE. The Treasury CANNOT create money and CANNOT do QE. Only the Fed can.
They discussed this idea (of replacing older bonds with newer bonds) at least twice before, in 2015 and last summer, and nothing ever came of it. And I think nothing will come of it because replacing one set of bonds with another set of bonds is complicated and could be a technical default, unless the bonds are callable, and to my understanding there are no more callable Treasury securities outstanding.
Out there in the social media and blogosphere, there is a huge amount of ignorant garbage floating around about this meeting.
“Tax revenues are already not enough to pay for outlays. So any bond-buybacks would have to be funded with new bond sales.”
This is not entirely accurate. The Treasury does have a significant amount of money in their cash account currently. They could in theory use it to buy hundreds of billions in treasurys before they would need to replenish their cash reserves in the open market (and who knows, by then the Fed could have introduced the much-awaited ‘pivot’).
So where the heck do you think those funds in the government’s checking account (TGA) came from????? From tax collections and bond issuance! They just haven’t spent it all. Sheesh.
The US government CANNOT create money. It gets is funds in two ways: Receipts from taxes/fees; and bond sales.
OK, right now it also gets money from selling oil from the SPR, but most of that money is just funds that it had put into buying the oil in the first place, and a small portion of it might be profit.
Note the huge spike in the TGA balance in 2020, when the Treasury sold a huge amount of bonds to fund the stimulus expenses, but then didn’t spend it all. Most of it got spent by now. Balance is down to $640 billion. They probably don’t want it to drop below $400 billion, given the large money flows through that account.
The meeting specifically discussed a bond exchange – buying back old less traded bonds and replacing them with new heavily traded bonds to improve liquidity.
The people out there who say the government does QE when it buys back bonds (with proceeds from selling bonds) are clueless morons. I’m so tired of having to deal with this BS.
… And mint coins?
At least I think the government can do that.
The average amount in the TGA in the decade prior to the pandemic was $250bil so that gives them $400bil to buy bonds without issuing new debt, at least not immediately (and with the hope I guess that by the time they do, the Fed would have resumed QE).0r
Forget average. You need to look at the trend. The debt is now $31 trillion, with a huge amount coming due every month and needs to be replaced, and so enough cash needs to be in the TGA to fund those maturities. In addition, the budget has ballooned and a lot more money is coming in and going out. So you MUST look at the trend, how it has grown, and will continue to grow.
Even if the TGA drops by $200 billion, the reason why it drops is irrelevant, whether to buy back bonds or to pay for supplies, salaries, and equipment, it makes no difference. It’s not QE. And it doesn’t have the effect of QE.
The TGA drops when less money comes in (from taxes and bond issuance) than is being paid out. Just like any checking account.
That BS of the Treasury Dept doing QE attracts nothing but more BS.
“They discussed this idea (of replacing older bonds with newer bonds) at least twice before, in 2015 and last summer, and nothing ever came of it.”
Wasn’t that what operation TWIST was?
No. Not at all. Had nothing to do with. That was done by the Fed, not the Treasury. And it involved letting Treasury bills roll off when they mature and replace them with long maturities, such as 10-year yields. The purpose wasn’t to improve liquidity in hard-to-trade bonds that were issued years ago (the current problem) but to push down long-term interest rates with printed money.
If the Treasury were to purchase treasurys in the open market using cash in TGA without turning around and issuing new debt in their place (i.e., drawing down their cash balance instead) then the effect would actually be pretty similar to QE (again, at least temporarily until they issue new debt). That was the point of my post.
“If the Treasury were to purchase treasurys in the open market”
No one can do that. Bonds are bonds. They’re binding for the issuer. The issuer has to pay face value at maturity date, and has to pay interest until then. The issuer cannot buy them back willy-nilly (at a discount, hahaha). No company or government can do that unless the bonds are “callable” which they’re not. That would be violating the bond contract. It would be considered a form of default — a “bond exchange.” What do you people think bonds are????
Even if they could do that, it wouldn’t be QE because QE is purchasing bonds with newly created money, not with existing money from a checking account. Good lordy.
“Wonder if Powell can be sacked if Dems lose both House and Senate?”
Why ? So his replacement can resume hyper-counterfeiting again and destroy the world reserve currency ?
Enquiring minds want to know, ha.
A beginning of the end of the letge, costly & inefficient dealer network
Do you think that it’ll take a few more months before the domestic automakers begin to have layoffs ? They don’t have anything affordable or efficient that they can switch to.
I would have thought that Toyota would have ramped up production of hybrids sooner. Of course the lead time for that is measured in years rather than months.
Nah. Production cuts leading to shortages have created pent-up demand of about 4 million new vehicles — meaning about 4 million people haven’t bought a vehicle over the past 18 months because of the shortages. But they’re eventually going to buy when lots are full.
That said, legacy automakers have been laying off people in their ICE divisions, and they’re hiring like crazy in the EV divisions.
High Days of Supply (60-90 days) should be considered an obsolete metric and abandoned now.
Piling up cars and awaiting them to rust away on the backlots while accruing interest expenses and other charges is a tremendous waste and inefficiency.
What is needed is flexible, responsive production systems. Cars manufactured to order and delivered to a customer 21 days or 45 days, maximum, domestic and imports respectively. (Specialty cars, excluded).
Why should the GM model of production and distribution, perfected in the early 1920’s be relevant today?
With the sophisticated supply chain, forecasting, and production/manufacturing systems, real time visibility of the entire process, the 1920’s business model should be buried for dead. Under the current antiquated system, the only beneficiaries are the car manufacturers. They build the cars; dump them on the dealers; and the customers pay for the inefficiencies of both the factories and the dealers.
I mean … the world has moved more and more to just-in-time supply, but that’s brittle, as we found out during COVID.
Complexity is what makes “flexible and responsive “ manufacturing difficult. There are literally millions of combinations of vehicles that can be built. Also, the body shops have a larger lead time….try painting 10K vehicles per day.
Last new vehicle, a 2019 pickup with plans to drive at least six times across USA, was ordered to my choices to be able to navigate back country Rocky Mtns and still be as fuel efficient as possible compatible with 4×4 and full bed for camping, etc.
Took well over 4 months, before any hint of pandemic, etc., and came with several mandated appearance upgrades…
SO, IMHO, the manufacture to order biz needs some serious improvements before it becomes viable.
OTOH, similar in 1989 was delivered in 4 Weeks and exactly as ordered.
Otherwise agree BC…
I think the ordering process depends on the manufacturer. Ford will deliver based on allocation, and from what I hear RAM will custom build from predetermined options what you want.
BC’s theory would work on the theory of “any color you want, as long as it’s black” production model. Having spent decades working for an auto manufacturer of not insignificant sales and production, the production planning has a lot to do with plant profitability and access to components. Not consumer whim – which changes on a dime.
Access to components appears more a political past time . . .
As long as states mandate that you need to purchase your new vehicle from a dealership, there will be cars and trucks rusting on their lots with helpful salesmen looking for a commision.
Could any experts tell me what the heck is going on with Volvo? They make great cars, not just SUVs. I have always wanted one of their newer generation models, very fashion and comfort looking.
They’re a Chinese brand now, owned by a Chinese company. Nothing wrong with that. Go ahead and buy your dream car.
They’re lovely cars, but too expensive (new) for my wallet.
Had an old V70 years ago. Kids loved it. Eventually got too expensive to maintain.
I liked the PV544 because it reminded me of my ’47 Mercury.
Took one on a test drive when I was a kid, but couldn’t quite afford it: $2,500.
Volvos we’re ubiquitous in the 1990s. Their owners raved about them—except for the strange electrical problems. Then the car segment of Volvo was merged with Ford in 1999. They appeared to be making progress on shared platforms (and the electrical issues), but then Ford jettisoned Volvo to the Chinese around 2010, who don’t seem to be doing much with the brand, at least in America. I think they’re down to one chassis.
As a former Volvo owner, I can comment on why I no longer own/drive a Volvo:
The original Swedish Volvo’s were incredibly durable and long-lasting cars. They weren’t cheap to repair when they broke, but also weren’t difficult to repair. If you couldn’t handle the price of a new Volvo, buying a 3 to 5 year-old car and driving it for another decade was a very reasonable plan.
The new Chinese Volvo’s are effectively impossible to repair outside of an expensively-equipped shop. They’ve also used their control over parts to drive repair costs through the roof. A great example of this:
One of your axle seals starts to leak. In most cars, you pay under $100 for a new seal, and a few hundred for somebody to install it for you. Call it a $400 repair. You can’t buy axle seals for a Volvo. Volvo’s contract with the company that makes the seals prohibits them from selling the seals to anybody but Volvo. Nobody else makes a compatible seal, partly because Volvo has threatened to sue anybody who tries for infringing on Volvo’s intellectual property.
Volvo’s solution for your problem? You need to buy a rebuilt transaxle from Volvo for $4k. Add in another $1k labor to install it and your leaking axle seal has been fixed for a total cost of $5k.
After a couple of hits like that, even the most ardent Volvo fan goes down and trades the car in on something with more reasonable ownership costs.
Volvo has joined the other high-end European cars (Mercedes, BMW, Audi) as something that only makes sense to own/drive if somebody else is responsible for the repair costs (warranty or maintenance plan).
It has been confirmed by myself and many colleagues: almost all makes and models of automobile are trash in their own way. Some, more consistently.
It does seem difficult to find those parts, but I believe is possible now based on a quick search. Used 2020 XC90 t6 momentum and found axle seals, and transaxle seals.
@Cynical Engineer insightful thanks
Ran into same problem with “lubed for life” u-joints in split 71 Volvo Wagon drive line. Had to buy entire driveline. Maybe had 100K on it. But their motors back then still ran forever. Had 63,66,Sedans, 71,72. 72 Wagon hauled lots of cement, cinder blocks, and would hold 10 ft 2 bys with read door shut…..was right up against glass. Also slept in it in winter for several years till I got more stuff built. Off grid home the hard way…..still worth all 16 years.
Bleeezzez it dont don’t really.
As the full switch over to electric cars is on an unknown time-table, at least to the buying public, I doubt we’ll ever see the decent petroleum vehicles ever again have a large supply of superfluous vehicles. Which makes good sense. Toyota, which is top of the pile in petroleum vehicles, is sitting in the right spot with minimal inventory.
We’re nearing that point like in 2008ish when CRT televisions were discontinued in favor of the much better technologies of the flat panel tvs.
I’m sure no auto dealer wants to be stuck with old gas guzzler vehicles.
I don’t know why the manufacturers make such a big deal with the electric cars and trying to make them appear as unique or special vehicles anymore. The only real difference between a petroleum vehicle and an electric is the motor and energy storage. The rest is the same. 4 tires, seats, windows, accessories, etc.
It will be so nice when the noisey, air polluting, dangerous fuel, high maintenance petroleum vehicles are finally gone.
“She’s the last of the V8s. She sucks nitro. Stage four hits.. 600 horsepower through the wheels.
Come on Max; you’ve seen it. You’ve heard it. And you’re still asking questions?
When do we go for a ride?”
Ha! Just watched that one again last night. Still waiting for someone to explain the jet contrail in the sky above Max’s head in one shot out on the open highway. Planes, with little available fuel production? Fat chance!
How do you think the oligarchs are going to their summer villas in Mad Max time. They’ll take their private jets just as they do today.
They need to market them as special to get the older customers on board with leaving behind ICE.
Not really. Maybe it’s the “older customers” know from experience that it isn’t always wise to be an early adopter of unproven technology. Witness the issues with the electric vehicles after Hurricane Ian. I’ll bet that there weren’t too many that foresaw that problem (fires) associated with flooding.
Having spent more time than most of you in the car biz, I know not to buy a first year model until later in the production run after the “customer QC team” (aka early buyers) help discover the flaws in it and the engineers have time to sort them. I occasionally drove prototype cars (called mules) that had the existing body style but new running gear/technology. One had an active cruise control and CMBS (collision management braking system) over 15 years ago (which was developed in Indycar and F1) and it was a hoot driving in LA traffic. Early versions would just jam on the brakes randomly when a road sign or “welcome to” monument entered it’s field of vision. I took one mule with the lane monitors on a drive through Texas in the fog. Finally pulled “fuse 20” to keep the dang thing from shaking the wheel as it was blinded by the fog and assumed the driver crossed the lines There was no disable switch visible (it was buried in a menu) not to mention the screaming yellow “BRAKE” light that illuminated as well. That’s why most of the latest tech is introduced on limited production vehicles. The number of cars you have to buy back is greatly reduced. Ask BMW about when they went to fiber optic wiring in the 7 Series in the early oughts but didn’t include redundancy… when the fiber broke, things went dead and the only way to repair it was to dismantle the car and replace them.
So… I’ll stick with my dinosaurs for now.
My point exactly.
Older folks will want to stick with ICE because they are uncomfortable with change.
“It will be so nice when the noisey, air polluting, dangerous fuel, high maintenance petroleum vehicles are finally gone.”
AGREE! Even better when there are no more wars, and peace in the Middle East. No Poverty nor hunger…no babies born with crooked backs….
I can’t wait….
I can confirm meaningful incentives for full size trucks. $8000 off a $66k Ram 1500 Laramie truck in OR. They seem to be selling at those discounts.
NOT nearly enough H:
Last RAM, per above, was MSRP $42K; we paid $32K…
In spite of all the so called hedonics, it’s still the same 4 wheels, etc.,
Not in the market currently, in spite of my ”jonesing” for another new one,,, and plan to stay OUT until they,,, the GUV MINT they, get their stuff together to at least ”ALLOW” cars on offer something close to the fuel efficiency of my early ’80s civic hatchback,,,
with a 5 on the floor and the 1100 engine, we were getting close to 60 MPG,,, around town,,, and even a bit better ”on the road.”
Until ”they” get IT,,, gonna ”lay low and buy low, used,” and to heck with all the not needed tech, etc., to heck in a
straight line or not…
And many thanks to the commenters from India, et cetera with the clear indications of the insane ”TAX” on WE the PEEDONs due to the fascistic controls on our rides — from both side of the aisles of the current NANNY STATE of USA…
US car brands are just plain dumb.
Toyota and Honda will just keep eating their lunch, until the US brands all go belly up. Their waste of billions being plowed into EV’S will be what causes their final demise.
“Their waste of billions being plowed into EV’S will be what causes their final demise.”
Ha you better watch out – you’ll get “moderated” here for saying that ….
EVs is the only thing where sales are growing in leaps and bounds. ICE sales are way down. Time to get off this idiotic copy-and-paste horse you’re riding to death. You’re just making a fool of yourself in public.
I don’t disagree Wolf. I just don’t understand why their sales are growing leaps and bounds.
Because people want EVs? It’s the most exciting thing that happened in the otherwise boring auto industry in decades. You cut your fuel and maintenance costs by a large amount, and EVs accelerate better the ICE vehicles because even small electric motors have an enormous amount of torque, and the torque curve is flat. And they make little noise, and they recapture some of the energy from braking (regenerative baking), etc. etc. Drive one!
And instead of going to the gas station and getting your hands dirty and wasting time and gasoline going there, you plug the thing in at night in our garage. People love that.
Solar powered charging of EVs fine. If grid powered – grid balancing – will a boiled kettle have to wait until the car is charged?
FYI ,Kia,Hyundai have engine problems,that they use 1 quart of oil every 1,000 miles .Was going to buy a new Kia Rio did some investigation found this issue on web .Then my friend’s brother has a Hyundai asked him about it confirmed the issue .But they did replace engine Buyer beware
Hyundai/Kia issued a HUGE recall on their 2015-2017 gasoline direct injection (GDI) engines. And the companies set up something like $2 billion in charges to cover it. Came out last week.
Thank god they have hot-selling EVs that don’t have ICE problems like that.
The correct reply is Chinese EV brands NIO and BYD will be eating their lunch in the near future because China is 70 percent of all battery production and we all know the story with labor arbitrage.
Honda pulled most of their engineers who were working on the Red Bull Formula One team’s hybrid power units’ production and R & D away, one year ago, towards the end of the 2021 season. They are now working on Honda’s EV projects. Mind you, these are the best of the best engineers in this field.
Honda and LG are about to begin building a multi-billion dollar facility in Ohio to begin producing battery systems and vehicles outside of the realm of gasoline power and into EV land.
And Neel, when I see some of the amazing photographs of the James Webb Space Telescope that have just been published by NASA, I do want to thank you for your time in Redondo Beach, Cali when you worked at TRW Inc. and helped design the stabilizing components for the telescope.
Yeah, the President of my Fed’s branch, just upstream the Mississippi from my house on the Prairie, really was a rocket scientist back in the day.
P.S. Rest in Peace Didi. Your team won the Constructors Championship yesterday.
I doubt anyone in the US will be able to buy Chinese EVs in the foreseeable future.
Dealers aren’t even smart enough to keep one car of each model, so customers can come and check them out. They’d make a lot more money on pre orders. But you can’t even go for a test drive. The lots are empty.
I’d love to be able to afford a dealership. I could manage it better than they do on day 1.
“I’d love to be able to afford a dealership. I could manage it better than they do on day 1.”
hahahaha, no, after your investment is burned up in a few months, and you can’t pay your payroll and floorplan, you’re gone. You have no idea what you’re looking at.
It’s like the old joke. “How do you make a million $ in the car business? Start with $10 and buy a dealership”.
I guess none of them read the article that some Lincoln dealers will have to cough up $900K to sell EV’s. For Lincoln.
A dealer friend of mine (small-town dealer) is going through that very thing with his Lincoln franchise just after Toyota forced him to spend a gazillion dollars building a separate Toyota showroom building (he’d had one showroom for his three franchises). It never ends.
It is continually remarkable to me that so many people buy a car based on current gas prices. Gas prices high? Buy an efficient car. Gas prices low? Buy a huge SUV. As if prices had never been high or could never be high again.
Maybe the short-termism isn’t Wall Street’s fault, it’s just American.
I used to be a Regional Manager in New England. During the winter, you couldn’t wholesale a white car because there was no demand for them because “they couldn’t be seen in the snow”.
Fast forward to April, and the dealers were clamoring for them because “they’re cooler in the summer”.
I guess no one considered that the seasons change…..
Drive in Mexico. Majority cars small compacts and smaller Suv.
Different world there as far as vehicles go.
Many of the vehicles sold as new in Mexico cannot be sold in the U.S. due to Federal regulations.
Which is ridiculous. US (NHTSA) standards create vehicles that are tanks – safe for the driver only, and only marginally so if you consider that these cars feel safe at speeds that are way beyond the capabilities of the average driver (hence more risks), now come with AWD even in places where it doesn’t snow (so drivers take even more risk), and have insane acceleration capabilities (and again, more risk). US vehicles design is an everyone loses situation. Now go rent a car in any other country, so you can know what underpowered feels like, or that base vehicles do exist. Why would anything change here? When so many idiots keep buying pickup trucks as passenger vehicles and then the rest just buy oversized SUVs and trade them in every few years for the latest techno-filled novelty.
A different view is that inflation was created and did happen when there was monetary inflation. That is, when the money was “printed”.
What we see now is the effect of inflation, prices are rising. Or rather, the exchange ratio between money and goods and services are rebalancing to reflect that there is more money around, but no more goods and services around.
Money where created, goods and services was not created, the purchasing power of money do go down and prices measured in money rises.
In the land where 1.3 billion people living, 4 door 1100 cc compact ( Suzuki/ Hyundai) new ( no power windows, no power mirror ,only fm radio+power steering+ ac ) basic no frill model costs $ 7000 new on the road.( Mileage 12 city/17-20 highway). MG / Kia recently launched mini SUV costs $ 13/15000 are quite successful too. Premium Japanese/ Korean sedans are around $10-12500. Driving alone i still use my Yamaha 110 cc automatic scooter to weave in &out of traffic.s
Honda /Suzuki/Yamaha automatic scooter costs new 1200$. Mine 7 years old still running like new (40km/litre) Different words indeed.( Petrol/ Diesel now $1.25/litre)
All stick models.no automatic in 4 wheelers
The Japanese scooters are really nice, trouble free, fun ways to run most errands. About $2000 grand will get you a good used one in USA. One or two year payback by leaving the car at home.
Here in Costa Rica new Suzuki 4 door, 5 speed manual A/C power windows in front $12,000US All taxes paid.
Vehicle made in India.
800 CC 3 cylinders. 18.5 km/liter gas.
Gas price regular about $6.00 gallon.
It looks like everyone who was rushing in with their stimulus checks to claim their dream ride may be going underwater quickly. Can you imagine trying to sell or trade-in one of those gas-guzzling 2020-22 monster pickup trucks now? The car lots are already selling newer pickups for a lower price than most loans are paid down.
Put that on top of homes bought at peak prices or mortgage loans taken out on stimulated collateral. Higher food, utilities, insurance, etc. The recession has already arrived for many folks.
I think that phenomena is called the bullwhip effect, and as you have pointed out, we are going through that now. Perhaps Wolf can write an article on the subject if he hasn’t already.
I’m already seeing those 2020-2021 trucks go up for sale around me. They’re asking nearly new MSRP for something with 16-24k miles. Gonna hurt as they eventually accept much less than they owe just to be out of that shiny albatross in the driveway.
If you need a truck for work, the newer light trucks are optimized to sell to a different market, and it’s style/appearance- and tech gadget- driven as much or more than the traditional utilitarian qualities of trucks. Not surprising that tastes change, quite apart from the price of gas, if it’s just fashionable transportation. If EVs hog market-share-to-be, the remanent of overly complex late-model ICE trucks may have few buyers and little serviceability. Orphans of technology. Hope to never have to buy new, and it’s prudent to avoid the dregs of sunsetting production of anything. Older trucks in mild climates can run a long time.
“Older trucks in mild climates can run a long time.”
Yep, people around here (Texas) who need a work truck buy used. There is a huge market here for good used trucks and people come from northern states to buy as they just don’t rust out here.
Yep. Fly down & drive it back. Spend way to much time searching
for 99 or 00 ford 7.3
I was looking for Saab on Wolf’s chart. Had to Google it. Bankrupt in 2011. Chinese company took it over. Never got the email…
Just another Saab story….
Ford’s compact pick-up, the Maverick, is reportedly selling well; owners report near-50MPG for the hybrid version. GM and Ford abandoned small cars but have gone all-in on EVs; that may save their bacon in the long run. Stellantis (Chrysler) appears to be lost in the woods.
“Stellantis (Chrysler) appears to be lost in the woods.”
Yep, if it wasn’t for Ram and Jeep, those guys would be long gone like Hudson.
That’s kinda silly. It’s like saying “if it weren’t for the iPhone, Apple would be long gone,” or “if it weren’t for windows, Microsoft would be long gone.”
Jeep and Ram are their bread and butter, and they sell like hotcakes. In fact, Ram makes the best heavy duty pickup of the 3, hands down.
There is already a hybrid Wrangler, and I expect Stellantis to expand on their offerings.
If I could buy a brand new 1995 Dodge Intrepid 3.3L, I would.
But that was not the same Chrysler company of the present.
‘Yup, the US admin decided they wanted higher gas prices, so it started the invasion of Ukraine..’
Complete crap on many levels.
According to Tucker, we forced them to invade.
I wonder how the Chinese soldiers compare to the Russian soldiers.
“…other brands are amply stocked or overstocked, particularly those focused on full-size trucks and SUVs (Ram and Jeep)…”
Real trucks, Wolf, that actually do work, are still nowhere to be found. I’m talking about 3500 series actual trucks, not 1500 grocery getters with small axles and rotors which warp if you look at them crosseyed.
There are plenty of 3500s around. They’re just expensive and decked out vehicles for close to $100k. That may not be what you want. You may have to order a strippy work truck. We always used to do that anyway so we could get exactly what we needed to get the job done. These are not mass-market retail units.
Where do you see them? The largest Ram dealer in the country has nothing on the lots, and they only show a few dozen on order.
I see the 3500s on the websites… and they have been issued stock numbers, so they’re stocked in at least on paper. I didn’t physically go there and drive one. The small-ish dealer in Walnut Creek has 3 of them.
A larger dealer in San Leandro lists about a dozen of them, but they don’t give out any info for anything unless you contact them by email, so forget it. There are others too.
All of them come with big fat discounts.
Here is a cute one. Seems like a small dealer in Napa. Has two 3500 work trucks, maybe what you’re looking for, pictures taken at his dealership out front. I know a dealer who does that, gives a personal touch by putting the trucks in front of the store that locals recognize.
Have a look:
I follow several brokers on the Lease Hackr forum, and there’s plenty of new car inventory with good percentages off MSRP if you know where to look.
One of the brokers mentioned the other day that there’s a ton of BMW X5 SUV inventory out there, and this broker had them for 12% off MSRP. Another broker has a ton of Toyota inventory, and hybrid models that were $3K or more over MSRP are going for MSRP now.
It’s time for me to vent. I ordered a 2022 Ford Maverick on Sep 15, 2021. I was called by my Ford dealer to come and pickup the vehicle on Oct 13, 2022. Yeah!! My wife and I went to the dealer, viewed and drove the truck then worked out the payment thing. Almost there. Then the floor manager showed up and told us he couldn’t sell us the truck. Ford issued a delivery hold, recall 22C20, on the vehicle. According to the recall notice concerning the side airbag curtains, “A complete Dealer Bulletin will be provided to dealers early 1st quarter of 2023 when it is
anticipated that parts ordering information and repair instructions….”. No instructions or parts are “anticipated” until “1st quarter of 2023”. Now my new truck will sit out in the rain, snow and cold on the dealer’s lot until some time next year. I may even get my 2022 vehicle in spring/summer 2023!!! As it sits right now, people who order their 2023 vehicle will theirs before I get my 2022 model. A 13 month wait as of now, Oct 2022, and I may get the thing in another 3-6 months. I’ve been buying Ford vehicles for decades. If I ever get this Maverick, it will be the
last Ford I ever purchase. There, miraculously, no profanity or capital letters.
Here is a question. I hope readers don’t find it dumb.
Will the price of a brand new Tesla Model X or Model 3 collapse in the future? It probably won’t happen next year (right away), but what if the unemployment rate surge and people lose their jobs? We have not seem a massive layoff yet.
Will the waiting list of tesla shrink because people can no longer afford one?
Out of selfishness, I am looking to get a tesla car. It’s not urgent, but I would like to know your opinions.
My 2 cents: the supply chain of chip shortage won’t be improved anytime soon. Instead, if the demand plunges (because people can’t afford it), I guess the price of a Tesla will come down.
I was in the market for EV few months back. Mu budget was 60K or so.
I test drove almost all EVs and chose non Tesla.
Tesla prices may come down because of competition as well .
Most of my friends bought teslas because of status symbol but they were not too happy with initial quality of Teslas, although Teslas are good cars.
60K?! I bought my 2020 BMW i3 with a closing price 48K, excluding the federal and state tax credit.
Perhaps i should feel blessed because i got an EV with bargain price?
Small correction: Canada also has Toyota and Honda Assembly Plants. All are also being impact by “supply chain issues”.
So why our genius CEO’s who are the smart people in the planet cannot produce cars? They make Multi-million pay packages and can’t deliver, literally.