4
0

Used car market implodes on bad loans…


 invite response                
2022 Jul 2, 12:48pm   13,557 views  99 comments

by Ceffer   ➕follow (5)   💰tip   ignore  

"The used car market is on the brink of an auto loan collapse that can shake the entire industry.

I am shocked that more people are not talking about this!

We are facing a 2008-ish scenario in the used car market and honestly, it's a disaster waiting to happen."
"My beautiful Monster Truck! Melting, Melting!" Couldn't afford the gas prices for the sucker, anyway. My self image driving Mom's old Prius will really suffer.

https://threadreaderapp.com/thread/1542860348742836225.html

« First        Comments 61 - 99 of 99        Search these comments

61   gabbar   2023 Feb 17, 5:50am  

New car inventory is still low. WTF is going on? Supply chain breakdown? Inventory control?
62   zzyzzx   2023 Mar 1, 5:20am  

https://finance.yahoo.com/m/9a801cdf-a385-33d1-a268-04f3c9294946/general-motors-is-reportedly.html

General Motors is reportedly cutting around 500 jobs, a month after CEO said ‘We’re not planning layoffs’
63   🎂 Tenpoundbass   2023 Mar 1, 6:04am  

HeadSet says

Still no used or new car bargains here yet.


The Deals are all at the auctions. They buy them cheap and put them up for sale with a huge markup, to protect the rest of their inventory.
(Shrugs) It worked for the Real Estate market.
64   WookieMan   2023 Mar 1, 7:47am  

gabbar says

New car inventory is still low. WTF is going on? Supply chain breakdown? Inventory control?

China is dying demographically. So is a lot of Asia that makes the electronics for some car parts and other electronics. I dislike Biden in general, but he made a good move following through with Chips Act. Probably will be his only and greatest achievement. And yes probably kick backs to the big guy included... But this is a massive project. Drove by it a couple weeks back. It's huge.

https://www.azcentral.com/story/money/business/2022/12/07/what-to-know-phoenix-taiwan-semiconductor-factory/69707994007/
65   GNL   2023 Mar 1, 8:17am  

zzyzzx says

https://finance.yahoo.com/m/9a801cdf-a385-33d1-a268-04f3c9294946/general-motors-is-reportedly.html

General Motors is reportedly cutting around 500 jobs, a month after CEO said ‘We’re not planning layoffs’

500 jobs out of an employee count of 167,000. Oh no!!!
66   HeadSet   2023 Mar 1, 7:42pm  

Tenpoundbass says

The Deals are all at the auctions.

Auctions is where the cab company got most of its vehicles, so I am familiar with them. Still no deals yet.
68   WookieMan   2023 Mar 2, 3:59pm  

HeadSet says

Tenpoundbass says

The Deals are all at the auctions.

Auctions is where the cab company got most of its vehicles, so I am familiar with them. Still no deals yet.

There won't be any deals on cars until there's more of them. THIS is the same thing as real estate that some users can't wrap their mind around. If there's no product and people NEED a car or house you'll pay more. INVENTORY. 10 people fight for 1 house or car and the price goes up. 10 people move out of the Bay Area and no one wants it prices drop. 10 people move to my town and there's only 1 house, prices go up.

Not shitting on you Headset. There's just some lately that don't have any logic here or are basing it on the specific zip code they probably rent in. That's not the rest of us. It's the uhaul effect. Check the prices going into CA versus out to say Texas somewhere. Same route. They'll damn near pay you to bring a truck back to CA from TX.
69   GNL   2023 Mar 3, 6:31am  

It looks to me like the goal is to make the same profits on fewer sales. This solves the resource problem the greenies/globalists want while keeping corporations solvent. Unless rising rates can solve inflation (and even cause deflation(?)), only the rich will own anything while the rest of us own nothing but still be happy.
70   1337irr   2023 Mar 3, 7:23am  

WookieMan says

HeadSet says


Tenpoundbass says

The Deals are all at the auctions.

Auctions is where the cab company got most of its vehicles, so I am familiar with them. Still no deals yet.

There won't be any deals on cars until there's more of them. THIS is the same thing as real estate that some users can't wrap their mind around. If there's no product and people NEED a car or house you'll pay more. INVENTORY. 10 people fight for 1 house or car and the price goes up. 10 people move out of the Bay Area and no one wants it prices drop. 10 people move to my town and there's only 1 house, prices go up.

Not shitting on you Headset. There's just some lately that don't have any logic here or are basing it on the specific zip code they probably rent in. That's not the rest of us. It's the uhaul effect. Check the prices going into CA versus out to say Texas somewhere. Same route...

I can attest to the Uhaul stat.
71   WookieMan   2023 Mar 3, 7:47am  

GNL says

It looks to me like the goal is to make the same profits on fewer sales. This solves the resource problem the greenies/globalists want while keeping corporations solvent. Unless rising rates can solve inflation (and even cause deflation(?)), only the rich will own anything while the rest of us own nothing but still be happy.

I believe it's a generational thing. Multiple factors. The boomers built a shit load of houses that weren't needed. Lenders fucked up and loaned to unqualified people. Housing crash happens and shit hits the fan. Builders stop building and the trades lose a generation of plumbers, hvac, framers, concrete, electricians, etc. So we're now left with a labor shortage in the trades and a bunch of you tuber digital generation.

We solved this by having damn near negative interest rates to an extent though not all that much building outside of hipster areas like Denver and Phoenix (Boomer retirees). Combine that currently with covid and cities going to shit we have a very weird situation. Millennials are finally having families and realizing that you cannot raise kids in cities. No one was building in the far out suburbs where there's cheap housing because of profit margins so existing home sales sky rocket.

This is why I get so testy on this topic. We're witnessing the 80's and early 90's. It's a cycle. The same happened in the 40's and 50's. If you have kids you don't want to raise them in a city. It's a central work place for big business. A good chunk are there to serve in the restaurant, tourism, travel, service type industries. Basically it's ghetto/losers. Then you defund police and allow blatant homelessness and no one wants to live there. So prices drop in the highest cost of living areas, but rise in the outlying areas. But it drags the median price down. This is regardless of interest rates. It's demographics, movement and inventory.

This will happen again in 2050(ish) is my guess. You guys can call that prediction out then. Goal is to be alive then, but not much longer after. As long as I see a grandkid at some point, life will have been fulfilled for me. I'm not long for this earth lets put it that way. If you're not enjoying life why do it? That's my single goal. To see one of my boys had a kid and not have to pay for the wedding.... Hold the baby and start doing really crazy shit when I'm 60. No intention of living past 70. All my parents boomer friends are in miserable health and quality of life. I kind of want to go like Sonny Bono did. Just smash a tree and die on a mountain. Maybe fall into the Grand Canyon. No chance in hell I want to "feel" what 80-90 is like. Rant over.
74   🎂 Tenpoundbass   2023 Mar 20, 8:21am  

WookieMan says

The boomers built a shit load of houses that weren't needed.


But we have a housing shortage Lt. Dan!

Houses wouldn't be 1/3 of the price that they are if there were adequate housing stock. Had Trump built 10 new Metro areas, the median house would be $150 to $175K the building boom would be so great, nothing that Joe Biden did would be fucking up the economy. They would have had to outright halt all construction on those towns, to have crashed the economy.
75   GNL   2023 Mar 20, 8:23am  

Tenpoundbass says

WookieMan says


The boomers built a shit load of houses that weren't needed.


But we have a housing shortage Lt. Dan!

Houses wouldn't be 1/3 of the price that they are if there were adequate housing stock. Had Trump built 10 new Metro areas, the median house would be $150 to $175K the building boom would be so great, nothing that Joe Biden did would be fucking up the economy. They would have had to outright halt all construction on those towns, to have crashed the economy.

Building new cities goes against greeny and the globalists.
77   clambo   2023 Mar 20, 9:23am  

I don't understand why anyone doesn't just pay cash for a used car.
After a few years they lose most of their value but they still are good.
I guess it's a dumb question; nobody has any cash.
78   zzyzzx   2023 Mar 20, 9:42am  

clambo says

I don't understand why anyone doesn't just pay cash for a used car.


Sub-prime borrowers are about as good with their money as the proverbial drunken sailor or politician. They can't save up for a car, or anything else.
79   NuttBoxer   2023 Mar 20, 11:12am  

I've always paid cash for my cars. And it's not a few years. As soon as you leave the lot, your car loses thousands in value. It's a depreciating "asset" for getting you around. Whatever runs and requires low maintenance, go for that.
80   Reality   2023 Mar 20, 11:18am  

I used to pay cash for brand new Toyota's and Honda's, then keep them for decades passing them to family members (kids newly getting licenses, so reliable cars that can take dents make sense); however, in recent years (before the FED tightening) when loan interest rates were heavily subsidized (like 1.5%) or lease residues were heavily subsidized (e.g. 70% residue at the end of 4yr lease), on some more fashionable brands, while dealers refused to budge on sale prices (likely due to accounting reasons, a little like some home builder would rather throw in a new car instead of discounting on home sale price because discounting would instantly put his inventory into negative equity and could trigger the bank into recalling commercial loans on the inventory), financing and/or lease became better deals. Of course, the folks taking out subprime loans were likely not coming to that conclusion after crunching the numbers.
81   SunnyvaleCA   2023 Mar 20, 12:51pm  

FuckTheMainstreamMedia says


Speaking of which, why the hell do the idiots driving those big trucks insist on driving way too fast for conditions. Morons don’t realize that heavy large trucks take longer to stop than smaller cars? The new compensation? No longer a sports car, now compensation is a large truck?

I think the truck trend has a few helpers:
• Federal (and California) regulations are tougher on cars than "light" trucks (pollution, fuel economy, required "safety" features, etc are all tougher for cars)
• Marketing
• Versatility of trucks
• Dumbed down and numbed driving experience narrows the additional pleasure of driving a sports car
• Perceived and actual safety benefits of being higher and heavier than everyone else

The safety thing is a bit tricky. Physics will tell you that if 2 vehicles collide head-to-head, the taller and heavier vehicle will generally come out on top (literally and figuratively "on top"). So, buy something bigger than most other vehicles! It's an arms race that started when farming and handyman work pickup trucks were refitted with larger cabins and rear seats to become the 1990s SUV craze. Now that everyone has a large variety of SUVs to choose from, the SUVs and pickups have been progressively getting bigger to continue to trend.

But this safety logic is not fully correct. More than 1/2 of driving fatalities occur in single-vehicle accidents and many of multi-vehicle fatalities occur in the at-fault vehicle. Tall trucks substantially increase rollover risks and rarely have sufficient roof strength to protect occupants from being crushed, so the multi-vehicle-crash benefits are mitigated by single-vehicle-crash increases. One disconnect is that many drivers believe that the biggest danger comes from other vehicles, so multi-vehicle crash scenarios are given more weight than they deserve.

As a society, the benefits of tall-and-heavy are only relative to other vehicles: If everyone upsized then there's really no benefit overall. Also, the advantages of upsizing are only to the disadvantage of everyone else.

Unfortunately, government crash requirements exacerbate the trend to upsizing. Vehicles of all sizes are required to protect occupants in side-impacts of ever-increasing height and force. That puts small vehicles at a significant disadvantage, as truck bumpers are now aimed squarely at the heads of people in cars. Instead, the crash safety should at least partially come from requiring that the tall and heavy vehicles take extra measures to limit the damage they do. For example: Truck bumper heights should be required to meet car standards when the trucks are driven on-road and the bumpers could be required to spread and dampen force – it's much easier to limit aggression than it is to require substantially more defense.
82   gabbar   2023 Mar 20, 3:31pm  

NuttBoxer says

Whatever runs and requires low maintenance, go for that.

Which automobiles would fit these two criteria?
83   RC2006   2023 Mar 20, 3:44pm  

Hurry up and crash I have to buy a car in a few weeks after mine was totaled by old people that rear ended me.
84   Ceffer   2023 Mar 20, 4:53pm  

SunnyvaleCA says

If everyone upsized then there's really no benefit overall.

We both loved my wife's low, sporty Honda. However, it was too small and low and nearly invisible to SUVs and monster trucks. After being run into in the shopping center parking lot by a monster Toyota that couldn't even see her, I told her it had to go and we got her a Honda HRV, which is nice, but has a much higher visibility and seating. She groused a bit, but yielded, and then went and put dark tint on the fucking back windows so without the camera, you can't even back up with the goddamned thing. I think I am giving up trying to force safety on her.
85   GNL   2023 Mar 20, 5:08pm  

gabbar says

NuttBoxer says


Whatever runs and requires low maintenance, go for that.

Which automobiles would fit these two criteria?

Toyota and Lexus. I've been told countless times by mechanics that these 2 are the best vehicles to purchase. I drive a 2013 Camry and expect to get 300K out of it.
86   clambo   2023 Mar 20, 5:25pm  

I concur with GNL; I owned 3 Toyota trucks which were great.
87   Onvacation   2023 Mar 20, 5:25pm  

gabbar says

NuttBoxer says

Whatever runs and requires low maintenance, go for that.

Which automobiles would fit these two criteria?

Toyota, Honda, and Mazda.
88   RC2006   2023 Mar 20, 5:30pm  

Onvacation says

gabbar says


NuttBoxer says

Whatever runs and requires low maintenance, go for that.

Which automobiles would fit these two criteria?

Toyota, Honda, and Mazda.


Id scratch Honda of the list I was a pretty diehard Honda fan until lately. They have fallen a lot in reliability. Was going to replace my 2014 crv that had 210k that was totaled with a newer one. They have a lot of engine issues now with oil dilution.
89   RC2006   2023 Mar 20, 5:39pm  

A lot of the newer models across brands are less reliable because of the regulations to squeeze more mpg. Looser cylinder rings, turbo, plastic parts.
90   NuttBoxer   2023 Mar 20, 9:42pm  

gabbar says

Which automobiles would fit these two criteria?


So not just the makers listed, but the year is important. The art of Six Sigma was perfected in Japan in the early 1990's. If you can still find a Honda or Toyota that are from that era, those cars were made to last. I know a guy who had a Civic 500k and was still going strong. Also, ask anyone about the old Toyota trucks, the 22RE is legendary.
91   RC2006   2023 Mar 20, 10:28pm  

You can search best and worst years of a make and model.
92   WookieMan   2023 Mar 20, 10:33pm  

Onvacation says

Toyota, Honda, and Mazda.

I've got a 4 Runner (wife) with low miles and 2 Nissans with 200k+ miles. I'd throw Nissan into that group. Everyone I see with older model cars it's all Nissan and Toyota. I don't know Mazda. I just think of the small coupe with Mazda and I ain't fitting in that.

Occasionally I'll see an older Ford or Chevy on the road that's pre-2000's. Subaru seems to do okay, but they feel like station wagons with good AWD. They have shit clearance on all their models and it's a bitch car in the mountains. Think Denver, Bozeman, Tahoe, etc. My Nissan Armada has been the best car we've ever had by any standard. We thought we were crazy buying it at the time. No regrets besides the starter going 1 year ago or so and that was labor intensive. At 220k and hoping for 400k.
93   gabbar   2023 Mar 21, 4:16am  

NuttBoxer says


So not just the makers listed, but the year is important. The art of Six Sigma was perfected in Japan in the early 1990's. If you can still find a Honda or Toyota that are from that era, those cars were made to last. I know a guy who had a Civic 500k and was still going strong. Also, ask anyone about the old Toyota trucks, the 22RE is legendary.

https://www.carcomplaints.com/ has interesting info on year of manufacture.
94   Shaman   2023 Mar 21, 8:59am  

I got 220k out of a 2003 Camry before it started to leak oil (head gasket) and I got rid of it. Bout the same with a Sequoia, then a freeze plug (iron) rusted through and it sprung a leak, losing all my coolant in a few minutes. Got rid of that too. I miss that one. Maybe I should have pulled the engine but I don’t have an engine hoist. We donated the car.
95   NuttBoxer   2023 Mar 21, 9:22am  

Head gasket is a pretty routine repair, and a lot cheaper than a new car. I wait until it's high miles and transmission, or engine rebuild.
96   Reality   2023 Mar 21, 9:58am  

I'm keeping a couple cars from the time before "drive and steer by wire" (i.e. newer cars liable to being Michael-Hastings'ed)
97   rocketjoe79   2023 Mar 21, 10:02am  

clambo says

I don't understand why anyone doesn't just pay cash for a used car.
After a few years they lose most of their value but they still are good.
I guess it's a dumb question; nobody has any cash.

I could raise cash from my Retirement plan, but I have to pay taxes on withdrawals. If my marginal tax rate exceeds the loan rate, a loan makes sense, right?
98   brazil66   2023 Mar 21, 10:09am  

I've had a good run with a 2011 Kia Rio that we bought brand new. I used it to commute to work, and now my 18 year old son drives it. It has manual shift, steering, and windows. Few of his male peers can drive a stick! Good MPG. We change the oil every 5 or 6 thousand miles. We've replaced tires, brakes, fuel injectors, spark plugs and an O2 sensor. No big issues.

In 2017 we bought a used 2012 Kia Sedona minivan so that we could haul kids and friends around. It's never had any issues. I've changed oil every 6,000 miles and replaced tires, brakes, and battery. Now that my kids are older, I use it to go to work and for surfing. The back seats can be removed. You can sleep very comfortably in it. If you don't need 4wd, minivans are the shit.
99   GNL   2023 Mar 21, 10:21am  

I had the transmission rebuilt in a 2004 Accord at 160,000. $2,500. I got another 80,000 out of it and gave it to my daughter. The engine was in great working order and all systems and electronics worked perfectly.

« First        Comments 61 - 99 of 99        Search these comments

Please register to comment:

api   best comments   contact   latest images   memes   one year ago   random   suggestions