I have an 18 year old car that I purchased used long ago and currently has no mechanical issues. I've had a few repairs but nothing terribly expensive. I have no interest in replacing it.

When you think about it, people who are frugal will buy practical and cost effective cars and drive them for a decade or more (that is, if they buy a car at all!). That means they either never buy new at all, or when they do they do so only seldom.

People who are chasing the new shiny will continue to churn through new shiny. And of course they want to pay a lot to get only the shiniest.

So I can see why the average new car cost would creep up, because buying a new car at all is a luxury in most cases.

Cars just don't disappear, so all vehicles would "polute" the statistics right?

The cheapest Model 3 is $42,500. The cheapest Model Y is $45,000.

Is that cheap?

The Leaf ($30,000) and Bolt ($27,500) are cheap_er_ (by a lot), but they are still not what I (and presumably parent) would consider cheap.

I grew up in deep country. I've owned my share of pickups. When you need them, they're invaluable. When you don't, they're basically the most inconvenient daily drivers you can have short of a box truck, an RV, or a main battle tank. Outside of a fairly narrow range of medium-sized hauling activities, they aren't really even terribly good at carrying things.

I hate talking about things as "it's more than anybody could need" because you end up with needs-based conceptualization of lifestyles with people eating diets of only sweet potatoes, commuting on onewheels, and living in Hong-Kong style coffin apartments. But these things are not only obnoxious main character syndrome demonstrators, they're actively dangerous to everybody in and around them even when they're following the rules of the road.

If I was king for a day, I'd make driving one require a special class of license and tax them extra if they aren't being used for active work purposes like they're intended. They should be in the same class of vehicle as commercial box trucks, because that's what they're supposed to be for.

I wouldn't be at all surprised if some type of vehicle fad takes over the U.S. at some point where people just start driving converted box trucks or RVs around as daily drivers, then complain that all the parking garages and train overpasses are too low for their 13 and a half foot tall lifestyle decisions.

Point but e.g. the 2024 Silverado gets 12mpg in city driving. Go to any office parking lot here and you’ll see a lot of that size truck which have clearly never been used harder than going to Costco - and even the better ones are barely approaching ⅔ of the mpg of the pickup my grandparents bought in the 1980s.

I do agree that from a pollution standpoint we should treat all inefficient vehicles as the problem but large trucks and SUVs have significant immediate downsides for everyone around them. They’re far more lethal when they hit pedestrians or smaller vehicles, they produce higher tire and brake particulates which are known to cause health issues, they take more space to park, and at least where I live there are streets which could previously handle bidirectional traffic but now require someone to pull over to let oncoming traffic pass because there isn’t enough room for two large vehicles. In contrast, sports car drivers pose less risk because they’re low to the ground and the drivers are far more likely to see you and avoid an accident.

Large pickup trucks take up a lot more space on the road and parking lots, are harder to see around, and when they get into accidents they cause a lot more damage and injuries to people both in and out of cars. There is a very different visceral response to a large pickup truck tailgating you with its driver perched above you, than a Lambo or 911 doing the same.

The default in America is to make everything out to be individualistic, but the rest of us have to bear the very real costs of the externality of pickups, not just limited to pollution but also safety, land use, etc.

I ended up in a fullsize primarily because I got it cheaper than the midsizes I was looking at. The midsize market is priced really oddly.

Anywho, I was blown away that it's getting me 23MPG. That's what my previous midsize was giving me. That's nearly double what fullsizes got in the 90s.

Aftermarket headlights blazing directly into the eyes of oncoming drivers are creating a hazard. As is the fact that it takes up a lot of road space and has poor visibility for small objects in front of the hood.

Between these two, quite a considerable market is being left unaddressed. The first to fill these niches with affordable models that don’t have weird quirks or make strange tradeoffs will likely do well.

Wages have been stagnant in the United States for nearly 50 years.

Every economic stat right now points to this as the core issue. Consumers are squeezed more on every last good and service, tons of services are now only available via subscriptions which inherently cost more, and despite the economy supposedly (and, actually) booming in a lot of ways, that doesn't hardly at all make it's way down to the workers either via higher wages, or via cheaper products.

This is a complicated situation that doesn't lend itself well to comments but a number of the bigger datapoints include an employment market that favored employers for the majority of the time since the 70's, the ongoing slandering not to mention outright interference on the part of employers against labor organizing, "inflation" that when you scratch the surface is just companies charging more because they can, the ongoing consolidation of enterprise resulting in monolithic companies that own dozens of brands of the same product, none of which truly compete on price, on and on and on.

There are a ton of good reasons for Americans to be broke, and a number of prominent economists have been ringing alarm bells for decades now that all of these things coming together is going to stall the economy cold and send us into the... by my count, fourth once-in-a-lifetime economic crisis I've experienced.

Also there's enough demand for high-margin cars to max out available production capacity, and would you want to be making major investments in ICE car production right now?

1) amortizing the assembly line and upfront platform design costs

2) the raw materials of the basic car components, e.g. power train, chassis, and body

3) getting the car into consumer hands (distribution fees, taxes, advertising, dealership margin, etc).

Everything else like labor and upgraded trims works out to a relatively small percentage of the overall price, often under 20%.

Since you can't make enough impact by cutting amenities, you have to cut one of the listed things. You mostly can't build things more efficiently than major manufacturers do (though Tesla is quite good here), so that's out. You can't shave 50% off the basic materials costs because you run into basic FMVSS issues. Kia's strategy is to get as close to this line as they can though. That means you need to cut from the third category. No company wants don't want to cut their own margin, so that's out. Manufacturers can't work around the dealers by law, so they need to keep some dealer margin. Manufacturers can't stop advertising because the advertising department has significant political power and can get anyone proposing that fired. Manufacturers can't avoid taxes for consumers either.

The only real paths to cheaper cars involve opening the market to competitors that aren't limited like this, for instance foreign companies that don't need dealers and are okay accepting lower margins and not advertising.

There are a bunch more in this price range due to launch next year.

Cheap-ish electric cars exist, they're just not, generally, suited to US consumer preferences.

You can't have it because of existing tarrifs.

Ultimately, you CAN "win" by doing really well with a low-end model, but the chance of losing big is there, too.

with the American consumer buying 15M cars a year at those average $50K there isn't an opportunity for the low end. And if such market really appears - i.e. if the American consumer would hit hard economic patch and would really need cheap car - it will be at any moment filled by cheap Chinese EVs.

Manufacturers make more money off selling luxury cars. The poors can just buy used luxury cars for all they care. We see the same problem with housing and luxury vs spartan options. The spartan option exists, but only begrudgingly so.

Any bit of telemetry in a modern EV is also in a modern ICE. There's no reason to hate on EV's for telemetry, you have to hate on the entire modern auto industry.

Yes.

But it does rue out every single modern car on the market.

Very frustrating

How much of that has to do with the USA's extreme needs for range and size?

There are places I'd be happy to drive a subcompact with a 300km range (eg. the Byd Dolphin), but most of the USA that kind of vehicle wouldn't be safe or practical. That's an awful lot of expensive battery-mass the Byd Dolphin doesn't have to pay for.

A lot of people do a lot of bad thinking when they say "oh, well, inflation is umptybumpkins percent, so the fact that cars are that much more expensive is 'just' inflation, and thus isn't anything".

But inflation is prices going up. When the various sources release "how large inflation is", they are telling you "this is how much prices went up". Ignoring prices going up because "oh, the prices went up because of inflation" is basically using the thing's own existence to argue that it doesn't exist, which, while abstractly sort of impressive, is not strong thinking.

There are some arguments about what causes prices to go up, but that's a separate question.

https://www.perplexity.ai/search/find-me-the-cpi-inflation-d...

New cars actually match the total average inflation the closest of any categories (22.3% for new cars vs 22.1% all items). Also interesting to note that food is up 30.7%, transport is up 39.5 % and shelter is up 27.6% in the past 5 years!

The cost of a GB of hard drive is failing spectacularly. The price of health care went up much more than the price of eggs. So what is the "real" inflation?

Government gets to pick what they use to define inflation so they can manipulate "inflation" numbers. And manipulate they do.

What you should look at is money printing: how much money did the government print. This is about 8% yearly for US.

This money debasement is eventually reflected in prices.

Some things get cheaper, because we can produce them more efficiently (like hard drives). Some things get even more expensive than 8% because we produce them less efficiently (health care insurance or college diplomas).

So to answer your question: cars costs more mostly because the government prints money, which devalues your dollars and car makers are not getting more efficient at making cars to counter currency debasement.

Yes. It's a huge expense for a lot of Americans. Either the primary expense, or just behind housing.

> assuming people don't want to drive vehicles older than a decade

That's not a great assumption, especially if you're looking at people with less money. The normal lifespan of a car is 15-25yrs, and _somebody_ is driving those cars.

As you suspect though, the flow of new vehicles largely goes into wealthier people (average incomes in the $100k range), and after 6-10yrs the used cars trickle down to everyone else and live ~20yrs in total. There exist a number of exceptions (e.g., people getting a new car for reliability and not realizing that you could replace the engine and transmission three times over for the extra premium they're paying -- trying to do the right thing and make a fiscally responsible decision but accidentally doing something more expensive), but those aren't the norm.

The median household income is ~$75k. There's ~131M households in the US. This means there are 65M households making more than $75k/yr.

But yes, generally speaking wealthier people are the ones buying new cars with a lot of people buying used models.

If we had a functioning housing market, you'd see something pretty similar there too. The wealthiest would be the ones paying for nearly all the new construction, instead of driving up the cost of housing for everyone else.

Those who are most able to pay for it are those who are paying for the highest initial costs, lowering the costs for everyone else by improvements in the technology, and making it easier for others to adopt later. Early adopters take lots of risk on things not working out well, and learning what things can go wrong and how to fix them (at additional expense, too.)

This is much better than those who are least able to pay being made to shoulder the cost and risks of being early adopters.

Good news, these are called "community solar gardens" and they exist all around the USA, here's a large one based in Minneapolis: https://www.cooperativeenergyfutures.com/

I've been to the US a few times, seen AC hanging out of the windows all over the place.

If you can do that, and Germany can do this, why can't you also do this?

Now sure, it won't cover 100% of demand, but it will help many of the poorest.

One group has insufficiencies that need to be solved, the other, excesses. Lessening dependence on the grid for the ones for whom cost is not a barrier lowers costs for everyone.

Now, having some sort of solar community energy bank would eventually be novel, akin to the replaceable battery charge stations for electric scooters in the Pacific Islands. Take your high density 12VDC canisters up, slot them into the locking wells, and get a text when they're full. Dock them onto your appliance circuit when you're home, and enjoy grid-free power for your home or vehicle.

I’ve been charged for things that should be under warranty. They refused to do a permanent fix for a recall after they did a temporary fix. Dealing with corporate is an exercise in being gaslit and living in a Kafkaesque nightmare.

Kia and possibly Hyundai are in purgatory right now: they’re innovating and making cars that no one else is. Their dealer network, however, can have some sleazy used car sales personalities and make for a terrible experience that can ruin your week.

Pick your poison.

As an EV6 owner I strongly considered the EV9 - which apparently fixes some of the annoyances of the EV6 and other eGMP vehicles.

Since the local power company here is only paying 10 cents per kw for solar power (which they resell at greater profit), I decided to run a small crypo miner and I still have excess power on a 22kw system.

I don't know of anywhere where its not legal to be solar powered but there were several thousand in costs associated with engineer plans and permits.

Seems like the utilities aren't involved at all?

Cheap storage actually makes grid defection a possibility for a ton of people these days. Especially when you start considering the cost of upgrading 100 amp service to 200 amp or similar. Once you've added a bit of battery, might as well go a bit more, and use your vehicle for additional backup when necessary.

People having 70kWh or more of mobile battery in the garage is going to change the calculation for a lot of people. Many people who would never install solar unless it saves them money will also spend a tooooooon of money on a big truck for aesthetic reasons, and then find that it makes solar a cheaper propositon.

Now let's add significantly reducing your own greenhouse gas impact for 20 or 30 years after you buy the demon solar panels (made from dead babies, some right thinking american might say), then putting your own excess electricity on the grid, further reducing fossil fuel generation. So in all thoses cases, that dastardly helpful socialism is for the public good.

Which is a good thing! It shows that those other quality issues are not related to US labor force, or some intrinsic American inability to make high quality goods.

Note that many of the "American" cars with the bad reputation are Toyota's with just a different logo. Even though it is easy to check who made the car, the American logo makes for the reputation that it will die in 100k miles.

OT but, there were clear exceptions to this even back in the bad ol' days. It was common knowledge in the 70s that for certain engines (such as Chevy small blocks), if you cared for the engine (mainly: regular oil changes) you could get 200K+ out of it. The rest of the car was too low-tech to decay, except of course for road salt vs body work.

They're great. I have rotated the tires twice on the Bolt and I'm getting some different wipers for the windshield because my wife doesn't like the noise the factory ones make. Oh, and I got floor mats for both cars.

I have Car Play in the Bolt and GM's own system in the Equinox (Android for Autos or something like that, not the standard Android Auto) and they're both fine.

I use SuperCruise whenever I can. That's only on freeways with the Bolt and a lot more other places with the Equinox. I was backseat in an Uber Saturday and it was neat watching the Tesla Model 3's AutoPilot system. Very cool. On the other hand, GM was reporting no accidents with their cars, which include ICE vehicles, too. https://gmauthority.com/blog/2024/02/gm-super-cruise-users-t...

I understand the desire to have a strategic reserve of manufacturing capacity. However, the US also subsidizes the US auto industry heavily by e.g. bailing out GM and Chrysler. It frustrates me that US car manufacturers continue to make exclusively heavy, low-efficiency vehicles. Give me something inexpensive, safe, efficient, reliable, and I'll buy it.

May be the lead in Chinese EV and battery industries is not purely technological, it is also the supply chain and scale developed over the years.

All this talk assumes that USA or Western countries have always had a level playing field whereas companies like Boeing or Airbus are prime counter examples

The whole talk about subsidies is pure smoke screen. US automakers have received a lot more subsidies than their Chinese counterparts. The top chinese firm receiving government subsidies, CATL, got ~$500M USD last year. BYD is said to have received $3.5 billion in total in its lifetime. In the meantime, the US government offered $12B just last year for automakers to start making more EVs, and Ford is reported to have received a total of $33B in loans, bailouts and tax rebates.

In any case, if you could put down $3.5B and get a BYD out, everyone would be doing it, reality is a bit more complex than that.

This is something I've always found fascinating about materialism (I can only speak to the US). The messaging and feelings are incredibly similar whether your budget is 10k or 100k. Very easy to slide up the scale slowly and feel like you're still living small with a bulging budget, or to choose options that are beyond your means and so stunt financial growth.

What it means that if you count what percentage of car parts are made in America, Tesla has higher percentage that other brands, even those you might consider "more" American, like GM or Ford. All Teslas sold in America are assembled in America (California or Texas). Ford Mustang, for example, is assembled in Mexico.

As far as I know Tesla never sold Chinese built cars in US. They used Chinese manufacturing (CATL) and Korean batteries in some model, but also manufactured batteries in US (Nevada, with Panasonic) and are expanding battery production in US with 4680 (used in Cybertruck).

Cheaper Teslas are coming to US but they'll be manufactured in US (Texas). Tesla told us that they'll start making a cheaper model sometime in 2025.

On the other hand, as the other comment said about him "tricking Republicans," I think he's also gained a new segment of buyers with his political play, so this might be a wash.

So, while I'd bet against Twitter (if I such a thing were possible), I wouldn't bet against Tesla being a good fit for the US market.

European sales may well collapse, and he may be very confused about this, but I'd still expect his approach to do well in the USA.

Hasn't that been true for every US presidential election?

Absolute hogwash.

The only way for this to be true is if you amortize the cost of R&D and factory building over a small number of batteries and include it in the manufacturing cost, and I think it's incredibly misleading to include the cost of R&D into the cost of a battery, simply for the fact that you can make wild claims by just including it.

So...for an incumbent manufacturer that's putting very little effort into actually selling EVs, it might be true that it's costing them $50K per battery if you include the cost of setting up the manufacturing. But for someone like Tesla, who has literally sold millions of cars, even if you include that cost, it's closer to $10K.

Also, fwiw, our home batteries (sold at profit, with lots of expensive other stuff and install labor) were about $20K, and the same capacity as our small car.

Isn't this a natural consequence of capitalism in entrenched industries?

Higher interest rates and other inflation caused by profit-taking in other industries drove this to a head since consumers couldn’t just soak it up, but none of the manufacturers wants to be the first to lower their margins.

I'll be squarely in the have-not camp, eager to serve our rich robot-assisted overlords.

At the same time, politicians will talk about the dangers of climate change and how we should all try hard to mitigate it. I guess some solutions just don't have the right story to it.

I do agree that the situation we are in now is due to lack of investment in EV/associated tech starting 1.5-2 decades ago. China has invested over 200 billion in EV+Solar and are reaping the rewards.

The complexities of this are outside my wheelhouse, but it's easy to see how keeping cheaper EVs out of the market would carve out a major source of cheaper vehicles period, leaving other manufacturers able to push higher priced cars. My guess is the tariffs are directly contributing to the process described in the article. Even if manufacturers were to "leave that market to China", eventually it would come to bite them as a certain proportion of people would start buying those cars instead.

Monopolies, monopsonies, and tariffs are playing a huge role throughout the US economy and it gets such little attention. Or at least it seems that way to me.

Looking unlike anything on the road catches eyes. Yesterday I was walking through an outdoor mall and I saw a bunch of kids crossing the road that jumped up and down and shouted "cybertruck!" when a cybertruck passed by.

Anyways, I happen to know the person who worked on the aptera's marketing campaign the first time around in 2009. Best Buy desperately wanted to get in on the EV market, and so they piloted showing Apteras at a few best buys, and they were laughed out of the room by all of the soccer moms walking in to store. It's pretty clear the market wasn't there in 2009... It's clear there is a huge vibe shift now, and the market is ready enough to at least launch the vehicle. Whether or not it will stick is a real question, but i think it would be silly to assume that the company can't get to say 100k cars on the road for lack of a market. Execution failure is, of course, still a possibility.

Why would it? It has a carbon fiber monocoq hull with a steel roll cage. The shape is pretty much egg shaped, which seems like it would be fairly structurally resilient (IANA MechE)

I purchased a 2023 Model 3 from Hertz over the summer for $23k, which I've been very happy with. I'm not eligible for either tax rebate (used or new), so 1 year ago I would have paid north of $40k for it.

There are definitely some good deals out there.

The annoyances of the Leaf are overstated, and the benefits are way better than people give credit for.

If people do what’s popular, they have to accept a popularity tax for the “keeping up with the Joneses” lifestyle

Mercedes sold their cars by having better engineering (perceived by customers). Does Lucid have better batteries? Almost certainly not.

I watching this video which lays out some fundamental diffs between US companies, like GM and Chinese companies, like BYD: https://www.youtube.com/watch?v=PXvcwM977D0 * Short term vs long term focus * .gov subsidies stronger in key markets in CN * CN companies extremely rapid in development (as low as 1.5 yr vs 6 yr in the US) * Lower wages and input costs

Things will probably have to get worse before they get worse. Corporate people know the machine (public traded US auto makers) keeps lumbering forward without change until it can't, and all handouts, bailouts, and other tricks have been played.

The Chinese are selling either at a loss or far below the return expectations of their competitions' investors. They're not going to stop, because they want to drive everyone else out of the market. The solution is to drop things like dividends and executive bonuses down to sane (or, really, non-existent) levels and pass along the savings to the customer.

Otherwise there might not be a company to collect ROI on in a decade or two. Not that most shareholders care; they hire a guy specifically to engineer the holdings so that they can drop any one of them and not lose lots of value.

There are 300 million Americans. Why should ~1% get to hold the remaining 99% hostage?

Protectionism based tax and economic policy causes the exact same outcomes but far enough in the future and far enough away that the people who implemented it will be retired and/or dead and the people who voted for those people to do it will have had time to spin some counter narrative about it being an honest mistake, everyone thinking it was a good idea at the time, etc, etc.

Don't you remember American auto workers beating a Japanese man to death? You probably don't, because they beat a Chinese man to death by mistake. [1]

[1] https://en.wikipedia.org/wiki/Killing_of_Vincent_Chin

Sure, but they've been saying full self driving is "next year" for a decade in a row. I take that with a large grain of salt. https://jalopnik.com/elon-musk-promises-full-self-driving-ne...

not like Tesla selling 3-ton vehicles that pretend to be green