New car prices are out of control

Page 4 - Seeking answers? Join the AnandTech community: where nearly half-a-million members share solutions and discuss the latest tech.

Born2bwire

Diamond Member
Oct 28, 2005
9,840
6
71
Huh. Thinking about it. I bought my Altima 2.5S in 2002, bare bones almost, for around $20-21K. Pricing a new 2.5S and it is $22.8K. That is less when you consider inflation. Personally, I have not felt that the low end has moved that much in the past several years.
 

Nemesis 1

Lifer
Dec 30, 2006
11,366
2
0
I agree, only people making more than 150k/year should buy houses worth more than 60k

Well where is this house located Washington DC . Man live in the middle states its alot cheaper . If you can't afford a $30,000 car on less than 150 grand a year . MOVE I could easily afford a 30,000 car on $125,000 a year and save 50,000 a year and be comfortable
 
Last edited:

purbeast0

No Lifer
Sep 13, 2001
52,834
5,713
126
Ehh, I'm kind of torn on this issue...actually no I'm not. I like new cars.

I drove a '91 car from 2000-2004 (cost 4k at purchase)...then I drove a '97 car from 2004-2007 (cost 2k at purchase). I *hated* the repairs, the downtime, the having to "get a loaner"..."car is in the shop"...etc over all of those years.

After graduating college and saving up for a little over a year I got my first new car for around $22k (SUV). I traded that in a while back and have another brand new car that was around $31k (SUV). I don't regret it. I don't miss the uncertainty of worrying which random part is going to break on my beater and leave me stranded.

What's the point of going to school and busting your butt all work-week to not having something nice? I don't need leather, moon-roof and the premium sound system...but I wanted those things to give value to the reason I get up each morning. Here's my first #Yolo but...you really do only live once. Can't take it with you. As long as you're aren't uncomfortable, have savings and can handle your bills - enjoy life.

one thing i've learned over the years of reading this forum is that 90% of the people on this forum aren't living for the now and they are all about save save save and penny pinching so they can save save save! then when they are 60 and retired they will finally be able to enjoy their money. probably will be frugal at that point too though.

luckily i busted my ass and i'm able to save save save for retirement all while enjoying a few luxuries as well. it is all about balance. gotta enjoy life while you can and in your youth.
 

JM Aggie08

Diamond Member
Jan 3, 2006
8,148
776
136
one thing i've learned over the years of reading this forum is that 90% of the people on this forum aren't living for the now and they are all about save save save and penny pinching so they can save save save! then when they are 60 and retired they will finally be able to enjoy their money. probably will be frugal at that point too though.

luckily i busted my ass and i'm able to save save save for retirement all while enjoying a few luxuries as well. it is all about balance. gotta enjoy life while you can and in your youth.

100% agreed. It's all about balance. There are so many other ways I can enjoy myself now that I won't be able to when I'm retired.

Living within means + occasional splurge + saving = :biggrin:
 

Red Squirrel

No Lifer
May 24, 2003
67,199
12,027
126
www.anyf.ca
I don't see the justification at all in buying a brand new car. A year later it's worth 1/4 if that, yet you owe more on it than what it's worth. Makes more sense to buy used and pay cash. A car is a tool. A brand new one will do the same job as a 5-10 year old one. The older one may need more repairs but its still cheaper.
 

rh71

No Lifer
Aug 28, 2001
52,853
1,048
126
Most people don't have $30k in cash sitting around. And if they are smart, they shouldn't want to blow it all on a new car when you can get a perfectly good used one for less than half that.

Do people have the same opinion of used electronics? If you're into something you're not going to buy used.

And nobody said you had to have the entire thing up front. Even if you have $10k saved for a $20k car that lowers your monthly payment and makes your annual salary less of a factor.

That's why I don't get statements like an engagement ring should be X months salary or your next house should be X% of combined salary.

Savings is not just for when you have gray hair. And nobody says you can't save half and spend half. People see a guy in his 30s in a Porsche and think it was a stupid choice. But see a bald fat guy in his 50 or 60s driving a Porsche and think that's cool he saved until retirement and you want to be him? Too many by-the-book-what-you-should-be-doing people and not enough I-live-life people. Well there are, but they are instantly judged by the former.
 
Last edited:

purbeast0

No Lifer
Sep 13, 2001
52,834
5,713
126
I don't see the justification at all in buying a brand new car. A year later it's worth 1/4 if that, yet you owe more on it than what it's worth. Makes more sense to buy used and pay cash. A car is a tool. A brand new one will do the same job as a 5-10 year old one. The older one may need more repairs but its still cheaper.

and someone who uses a computer to just browse the internet can say the same thing about a $400 pc vs a $2k pc, yet there are people who purchase $2k pc's.

or someone who pays $500 for a 50" tv and someone else pays $1500 for a 50" tv.
 

Baked

Lifer
Dec 28, 2004
36,152
17
81
Maybe you should stop defaulting on your loans, pay off your CC bills on time, build up a better credit rating so you can qualify for 0% financing and get the car without the extra apr costs. Just saying...
 

Naeeldar

Senior member
Aug 20, 2001
854
1
81
luckily i busted my ass and i'm able to save save save for retirement all while enjoying a few luxuries as well. it is all about balance. gotta enjoy life while you can and in your youth.

Truest statement here. People waste money on things all the time. I'm 28 and just bought a $55k and I'll be the first one to admit it's a waste of money/poor investment but most things in life are. Why else do I work my ass off if not enjoy life? I've always enjoyed cars and wanted a nice sport/luxury car and so I finally did it.

The only debt I had prior to the car purchase is the mortgage. I have more in savings then most 40 year olds etc.. Am i wasting money? yes. But I don't work to just save, I need to enjoy my life.

The fact of the matter is you need to know the full financial picture of somebody before you can say what they can or can not afford. For example I never had student loans but cleared my first 6 figure year by 26. So my savings is so far ahead of most people due to that. I can now spend more because I've built up some wealth/investments. I also waste money on island vacations each year but I don't buy a whoel lot of material goods through out the year (clothes, games etc...).

Point being is people waste money all the time. The big question is what are you wasting money on and can you afford it?
 

Exterous

Super Moderator
Jun 20, 2006
20,348
3,426
126
I see it as doing better than many people who constantly pay interest just to have something new to ride in, without investments to backup the loss. I also agree with Exterous' point, but I find simple solutions more appealing. It's always good having liquid assets. With that kind of savings plan, he can put off a car purchase if the cash is needed for something else. His method doesn't maximize income, but it also minimizes risk. I'd bet he was in a better position than the majority when the economy went tits up.

Probably but thats a pretty low bar :p
 
May 13, 2009
12,333
612
126
Maybe you should stop defaulting on your loans, pay off your CC bills on time, build up a better credit rating so you can qualify for 0% financing and get the car without the extra apr costs. Just saying...

Never defaulted a loan, don't have any cc debt besides a small balance I pay off every couple Weeks, credit score is great and could qualify for any 0% loan I wanted, etc.. I want completely off the payment treadmills including a mortgage.
 

purbeast0

No Lifer
Sep 13, 2001
52,834
5,713
126
Truest statement here. People waste money on things all the time. I'm 28 and just bought a $55k and I'll be the first one to admit it's a waste of money/poor investment but most things in life are. Why else do I work my ass off if not enjoy life? I've always enjoyed cars and wanted a nice sport/luxury car and so I finally did it.

The only debt I had prior to the car purchase is the mortgage. I have more in savings then most 40 year olds etc.. Am i wasting money? yes. But I don't work to just save, I need to enjoy my life.

The fact of the matter is you need to know the full financial picture of somebody before you can say what they can or can not afford. For example I never had student loans but cleared my first 6 figure year by 26. So my savings is so far ahead of most people due to that. I can now spend more because I've built up some wealth/investments. I also waste money on island vacations each year but I don't buy a whoel lot of material goods through out the year (clothes, games etc...).

Point being is people waste money all the time. The big question is what are you wasting money on and can you afford it?

i wouldn't call that wasting at all. those are memories that you will have for a lifetime. my wife and i also go to at least 1 carribean place a year, sometimes two. to be honest that is probably my favorite thing i do in life, going to warm clear water beaches and snorkeling. snorkeling is probably THE MOST FAVORITE thing to me that is out there.
 

skagen5555

Member
May 28, 2007
51
0
0
It boggles my mind how people are willing to take on a payment for 5 years with total prices of cars being close to half of their homes value sometimes. I just bought a cheap cash truck to replace a high dollar truck that I had sold. Just never felt right having so much money in transportation. I really feel like 30k vehicles should be driven by people that make 150k a year or more.
Looking for the off topic perspective please.

Nope. That's the crazy thing. My previous truck was paid for and I have a savings account. I told people I got rid of it because I couldn't afford the truck which I felt I couldn't even though it was paid for.

So you had a out right paid for truck... and sold it to buy a cheaper truck with cash... cause of your own perception that you couldn't afford a paid off truck? all because you don't wanna appear "ostentatious"?
 
Last edited:

AstroManLuca

Lifer
Jun 24, 2004
15,628
5
81
Do people have the same opinion of used electronics? If you're into something you're not going to buy used.

And nobody said you had to have the entire thing up front. Even if you have $10k saved for a $20k car that lowers your monthly payment and makes your annual salary less of a factor.

That's why I don't get statements like an engagement ring should be X months salary or your next house should be X% of combined salary.

Savings is not just for when you have gray hair. People see a guy in his 30s in a Porsche and think it was a stupid choice. But see a bald fat guy in his 50 or 60s driving a Porsche and think that's cool he saved until retirement? Too many by-the-book-what-you-should-be-doing people and not enough I-live-life people. Well there are, but they are instantly judged.

Electronics are a little different because if they're more than a few years old, they don't even work properly. Barring reliability concerns, you can drive a very old car and it'll still serve the same function as a new one. And because electronics have a shorter useful life, they're harder to find used.
 

Tweak155

Lifer
Sep 23, 2003
11,447
262
126
Truest statement here. People waste money on things all the time. I'm 28 and just bought a $55k and I'll be the first one to admit it's a waste of money/poor investment but most things in life are. Why else do I work my ass off if not enjoy life? I've always enjoyed cars and wanted a nice sport/luxury car and so I finally did it.

The only debt I had prior to the car purchase is the mortgage. I have more in savings then most 40 year olds etc.. Am i wasting money? yes. But I don't work to just save, I need to enjoy my life.

The fact of the matter is you need to know the full financial picture of somebody before you can say what they can or can not afford. For example I never had student loans but cleared my first 6 figure year by 26. So my savings is so far ahead of most people due to that. I can now spend more because I've built up some wealth/investments. I also waste money on island vacations each year but I don't buy a whoel lot of material goods through out the year (clothes, games etc...).

Point being is people waste money all the time. The big question is what are you wasting money on and can you afford it?

I'm in a similar situation and I'd never buy a $55k car (at least that is my opinion right now). It is all about perceived value.

Even the things I really like, I go for the best deals. I hate the idea of paying more for something than I think it is worth. It has nothing to do with having enough money or not.
 

veri745

Golden Member
Oct 11, 2007
1,163
4
81
I don't see the justification at all in buying a brand new car. A year later it's worth 1/4 if that, yet you owe more on it than what it's worth.

This is pure fiction. I bought a new Mazda a few years ago (2008, '09 model) because used ones with <50k miles were within $1500 of buying new. I paid ~$16k for it, and as of today, KBB value in excellent condition is $14,400.
 

Xonim

Golden Member
Jul 13, 2011
1,131
0
0
I'm only a little judge-y when it comes to this subject.

My background -- My first vehicle was a 1994 Chevy S-10 pickup I bought for $3500 at age 16. Had 155k miles on it when I bought it. Drove it for 6 years, never put a dime into it other than new tires and a new battery, traded it in for next to nothing at 200k miles (in 2008) because it needed several relatively expensive repairs. Used the trade as a down payment on a used 2005 Corolla S with 28k miles on it for $16k (new ones were around 20k). Still driving that, just paid it off (saved for / bought a house instead of paying the car off sooner), and I plan to drive it until the wheels fall off. I've been used to making the payment anyway, so I already set up a savings transfer in the amount of my payment so I can either pay cash for the next car or have a large cash down payment.

That being said, it's none of my business what kind of vehicles people drive, for the most part. I say for the most part, because I used to work in a full-service grocery store as a teenager. I saw single moms and/or families using foodstamps and WIC certificates, and then would load their groceries into brand new Escalades, Suburbans, one even had a newish Corvette. It was sickening. That is the only situation in which I care how much someone spends on their vehicle.
 

skagen5555

Member
May 28, 2007
51
0
0
I don't see the justification at all in buying a brand new car. A year later it's worth 1/4 if that, yet you owe more on it than what it's worth. Makes more sense to buy used and pay cash. A car is a tool. A brand new one will do the same job as a 5-10 year old one. The older one may need more repairs but its still cheaper.

this is kind of a silly argument. If you view a car as a tool, then you can't really bring up the fact that it depreciates cause you never bought it for investment in the first place. Secondly, everyone has different vices, yours maybe 1080p for TVs, or ultra graphics with PCs, they're all tools too and i bet you don't seek out the crappiest stuff that serve the same purpose. Some people like having nice tools... who's to say that wrong?
 

AstroManLuca

Lifer
Jun 24, 2004
15,628
5
81
I'm in a similar situation and I'd never buy a $55k car (at least that is my opinion right now). It is all about perceived value.

Even the things I really like, I go for the best deals. I hate the idea of paying more for something than I think it is worth. It has nothing to do with having enough money or not.

That's true. That's basically exactly how I feel. I really want to be careful not to judge people for their choices. If it makes you happy, fine, I won't say you're an idiot. The only really idiotic choices is when someone buys something that they definitely can't afford and it has real consequences. But if you splurge on something that makes you happy and you CAN afford it, I'm not going to say you can't have fun. At worst, you realize that maybe it wasn't worth spending that much money and it's a learning experience.

Personally, cars aren't worth much to me. As long as it provides basic transportation and is fairly reliable, I'm good. I can't imagine spending the cash to get even a low-end new car given how much cheaper used cars are. I can't even begin to imagine spending tens of thousands of dollars on what is basically a toy. The value of "newness" and how "fun to drive" the car is is very low in my eyes. But if you can afford to spend that kind of money and it doesn't send you into financial ruin, then by all means, be happy.
 

Capt Caveman

Lifer
Jan 30, 2005
34,547
651
126
Bought a new vehicle last year for the same price that I paid for my prior vehicle new 11 years ago. The amount of safety, convenience and performance features compared to the my old vehicle, it's surprising that the price of new vehicles aren't even higher.
 

Capt Caveman

Lifer
Jan 30, 2005
34,547
651
126
I don't see the justification at all in buying a brand new car. A year later it's worth 1/4 if that, yet you owe more on it than what it's worth. Makes more sense to buy used and pay cash. A car is a tool. A brand new one will do the same job as a 5-10 year old one. The older one may need more repairs but its still cheaper.

And a computer is a tool to many, but if I remember, it's a passion for you. Why not buy all of your computers/parts used?
 

purbeast0

No Lifer
Sep 13, 2001
52,834
5,713
126
Electronics are a little different because if they're more than a few years old, they don't even work properly. Barring reliability concerns, you can drive a very old car and it'll still serve the same function as a new one. And because electronics have a shorter useful life, they're harder to find used.

say what?
 

Capt Caveman

Lifer
Jan 30, 2005
34,547
651
126
And based on the economy today, used car prices have never been higher, so you're not getting as good of deal as you used to.

Quick google search came up with a number of articles, here's just one:

Some New Cars Now Cheaper Than Used Cars

Cost comparison between new vehicle and one year old vehicle:

Vehicle Typical Monthly
Payment New Typical Monthly
Payment CPO Total Savings
Over Term
Acura MDX 4dr SUV AWD (3.7L 6cyl 6A) $701 $675 -$1,560
Audi Q7 3.0T Premium quattro 4dr SUV AWD (3.0L 6cyl S/C 8A) $808 $781 -$1,620
Chevrolet Black Diamond Avalanche LTZ 4dr Crew Cab SB (5.3L 8cyl 6A) $735 $700 -$2,100
Dodge Grand Caravan American Value Package 4dr Minivan (3.6L 6cyl 6A) $362 $346 -$960
Ford F-150 SVT Raptor 4dr SuperCrew 4WD 5.5 ft. SB (6.2L 8cyl 6A) $814 $784 -$1,800
GMC Sierra 1500 SLE 4dr Crew Cab 5.8 ft. SB (4.8L 8cyl 4A) $531 $508 -$1,380
GMC Sierra 2500HD Denali 4dr Crew Cab 4WD SB (6.0L 8cyl 6A) $786 $767 -$1,140
GMC Sierra 3500HD Denali 4dr Crew Cab 4WD SB (6.0L 8cyl 6A) $799 $778 -$1,260
Honda CR-V EX 4dr SUV AWD (2.4L 4cyl 5A) $462 $452 -$600
Honda Odyssey Touring Elite 4dr Minivan (3.5L 6cyl 6A) $725 $692 -$1,980
Honda Pilot Touring 4dr SUV 4WD w/Navigation, Rear Entertainment (3.5L 6cyl 5A) $677 $655 -$1,320
Honda Ridgeline RTS 4dr Crew Cab 4WD SB (3.5L 6cyl 5A) $545 $521 -$1,440
Jeep Wrangler Unlimited Sport 4dr SUV 4WD (3.6L 6cyl 6M) $454 $443 -$660
Kia Forte EX 4dr Sedan (2.0L 4cyl 6A) $308 $299 -$540
Kia Optima EX 4dr Sedan (2.4L 4cyl 6A) $403 $396 -$420
Kia Rio LX 4dr Sedan (1.6L 4cyl 6A) $256 $255 -$60
Kia Sorento LX 4dr SUV w/Convenience Pkg (2.4L 4cyl 6A) $388 $381 -$420
Kia Soul 4dr Wagon (1.6L 4cyl 6A) $291 $282 -$540
Kia Sportage SX 4dr SUV (2.0L 4cyl Turbo 6A) $465 $449 -$960
Mazda MAZDA2 Sport 4dr Hatchback (1.5L 4cyl 4A) $265 $269 $240
Mazda MAZDA3 i Touring 4dr Hatchback (2.0L 4cyl 6M) $338 $323 -$900
Mazda MAZDA6 i Sport 4dr Sedan (2.5L 4cyl 5A) $327 $315 -$720
Mitsubishi Outlander SE 4dr SUV AWD (2.4L 4cyl CVT) $419 $401 -$1,080
Mitsubishi Outlander Sport ES 4dr SUV (2.0L 4cyl CVT) $328 $338 $600
Ram 1500 Tradesman 2dr Regular Cab LB (4.7L 8cyl 6A) $390 $388 -$120
Subaru Forester 2.5X Premium PZEV 4dr SUV AWD (2.5L 4cyl 4A) $427 $408 -$1,140
Subaru Impreza 2.0i Sport Limited PZEV 4dr Hatchback AWD (2.0L 4cyl CVT) $401 $386 -$900
Subaru Impreza WRX 4dr Hatchback AWD (2.5L 4cyl Turbo 5M) $462 $446 -$960
Toyota 4Runner SR5 4dr SUV 4WD (4.0L 6cyl 5A) $578 $556 -$1,320
Toyota FJ Cruiser 4dr SUV 4WD (4.0L 6cyl 5A) $501 $483 -$1,080
Toyota Prius Two 4dr Hatchback (1.8L 4cyl gas/electric hybrid CVT) $427 $413 -$840
Toyota Prius Plug-in 4dr Hatchback (1.8L 4cyl gas/electric hybrid CVT) $576 $563 -$780
Toyota Prius v Three 4dr Wagon (1.8L 4cyl gas/electric hybrid CVT) $482 $478 -$240
Toyota Tacoma V6 4dr Double Cab 4WD 5.0 ft. SB (4.0L 6cyl 5A) $488 $466 -$1,320
 
Last edited:

AstroManLuca

Lifer
Jun 24, 2004
15,628
5
81
I don't see the justification at all in buying a brand new car. A year later it's worth 1/4 if that, yet you owe more on it than what it's worth. Makes more sense to buy used and pay cash.

Factually incorrect, I bought a 2008 Honda Fit new in 2008 for $16k and sold it in 2012 for $11k. It takes like 10 years for a new car to reach 1/4 of its original price. The car I bought to replace it was a 2003 Accord for $6k, a car that probably originally sold for about $20k in 2003 (can't find historical new pricing). So it still wasn't 1/4 of its value. Maybe you meant to say it loses 1/4 of its value. Also depends on the car. American cars and luxury cars lose value much faster.

this is kind of a silly argument. If you view a car as a tool, then you can't really bring up the fact that it depreciates cause you never bought it for investment in the first place. Secondly, everyone has different vices, yours maybe 1080p for TVs, or ultra graphics with PCs, they're all tools too and i bet you don't seek out the crappiest stuff that serve the same purpose. Some people like having nice tools... who's to say that wrong?

Difference between cars and electronics is that electronics are a lot less expensive. Maybe you spend a couple hundred bucks extra to get something nice vs. the cheapest thing available, whereas with cars you're looking at thousands of dollars. Yes, everyone has their vice, but almost all vices are less expensive than new cars.
 

mvbighead

Diamond Member
Apr 20, 2009
3,793
1
81
To those comparing used to new prices now, you haven't looked lately. It is very seldom that you find a sub 30k mile vehicle that is a year old being much less than 5-10% off of the new one's price. Back in the day, that difference would've netted maybe a 20-30% depreciation. Anymore, it's not so much new versus used, it's simply people spending more than they can afford.

The OP's scenario is slightly different, but fits. Sure, you're doing fine and making all your payments, but one thing goes wrong and you're screwed. And for me, a truck is about the most ridiculous thing you can buy brand new unless you're regularly putting it to use as a truck.

All that aside, used vehicles aren't the dilapidated pieces of shit some are referring to. A 5 year old car with 100k miles is likely still good for another 100k miles. Hell, I've heard of people with brand new cars that have been in the shop more than my $6000 Equinox. All cars are prone to have an issue here or there, and new doesn't remove you from that possibility. I personally feel that a 2-3 year old car with 30-50k miles should be in perfect shape for several years of use.

Meh, I'll simply suffice it to say that a 30k car in my garage doesn't make me feel that much better than my 2007. Actually, the payment in most cases negates the positive feeling I get from having a new car. Now, having a car without a payment in the garage is a slight net positive. If the transmission blows, I don't give a shit because I can just get it fixed and keep driving it payment free.

I've just seen too many people with poor debt situations and someone loses a job and you're looking for ways to save money. Easiest way? Sell the thing that has the most value that can be replaced with something of lesser value.

That is not to say that you shouldn't buy a new car, but getting a new car every 3-5 years is overkill, IMO, if you maintain your vehicle properly.