Car Sales Are Down Almost 20%, but Prices Are Setting Records (Average new vehicle $35,420)

[Demovictory9]

Car shoppers hoping for Labor Day bargains may be in for a big surprise: This year, it seems, everything doesn’t have to go.

Dealers this year are unlikely to offer the kind of blowout discounts typical of the holiday weekend, when they often seek to clear out older inventory to make way for the incoming model year, analysts and dealers say.

Overall automobile sales have been off sharply during the pandemic, but in a reversal of what’s happened in most slowdowns, prices have climbed to new highs, thanks to a combination of limited stock, cheap financing and low fuel prices that have consumers gravitating to bigger, more expensive trucks and SUVs.

The average new vehicle sold in August cost a record $35,420, according to research firm J.D. Power, capping a surge in prices that began before the pandemic hit the U.S. This weekend could offer some reprieve from those highs, analysts say, but without the kind of big discounts dealers typically offer.

https://www.wsj.com/articles/car-sales-are-down-almost-20-but-prices-are-setting-records-11599219000

[underpants]

1. CarMax stock is doing nicely

[Sherman A1]

2. Not for long

I suspect that prices will adjust in 2021.

[bottomofthehill]

3. Maybe that is why car sales are down.

When it is so expensive to by, even a large repair bill looks better than a 72 month large darn payment. That’s roughly 6 years at $515 per month and about $750 a month on a 4 year loan at a really low interest rate

[NightWatcher]

4. The Boating industry is booming. I can't find a suitable used boat

And engines are flying off the shelves as people re-power older craft. I work on a boat daily and see more and more people getting out and having socially distant fun on the water.

New boats are selling faster than anyone else can remember as well.

[marlakay]

5. Depends on where you are

And what you sell. My daughter in bay area CA who is manager of large Honda store tells me they are super busy, so on top of covid she has to deal with scared employees and customers.

They changed some workers around and have shuttles that pick up and drop off cars if you don't want to come in and they also sell online and drop off the cars at your house.

[exboyfil]

6. Had to say goodbye to my 2009 car about six weeks ago

I would have needed to put $2-$3K into it in the next few months. Said goodbye to my 2002 earlier this year.

We went down to one car - a 2020 Subaru CrossTrac. I got the 10 year extended warranty (probably a waste of money, but I figure I have deferred auto headaches until I am 67), and then maybe I will be living somewhere that I don't need a car). They marked off about 10% from the invoice. I really wasn't in the position to negotiate a lot.

I would have liked to have waited until the job situation becomes clearer, but my wife needs wheels. My daughter has a CrossTrac, and my wife liked it when she drove it. I found a relatively stripped down one (I am not a big fan of the added features - I wouldn't mind a car with manual door locks and windows if they still sold them).

[Demovictory9]

10. manual door/windows... you'll get tired of reaching over to hit lock or roll up windows

[sarcasmo]

11. My current Honda has 3 different fuse boxes. Next car will have manual windows

with a generic radio and zero extra features.

[Klaralven]

7. Supply chain disruptions and shutdowns earlier means that the manufacturers didn't overproduce.

[hunter]

8. I bought a new car once in the 'eighties.

I won't do that again.

[misanthrope]

9. No car is worth that, not when

the depreciation is so immediately precipitous. Car prices have vastly outpaced inflation rates. According to Automotive News, the average transaction price in 1971 was $3,742. Using the Bureau of Labor Statistics inflation calculator, that translates to $24,360 in 2020 dollars.

Granted, new vehicles are loaded with far more technology but for it to drive prices up nearly 50 percent beyond inflation rate is just nuts.