Americans can't afford their cars any more and Wall Street is worried

Arguably cars became “unaffordable” sometime when loans became common - what percentage of cars being bought in credit can be argued, but clearly it’s become more and more.

"the customer only really cares about the monthly payment,"

I noticed this when I bought my Subaru. There was a young couple next to me that worked hard with the sales guy to get an acceptable monthly payment for their desired car. No thought about actual price or duration of the loan. I wanted to scream at them that they were making a big mistake.

Good news is the current US government is rolling back all of the regulation to prevent these bad loans from being given out, just to keep the music going for a little longer before this all blows up.

>It was one of the reasons we broke up -- she was the type of person who counted the amount she could borrow as an asset.

There's a joke about playing for the other team buried in there somewhere, lol.

And repossession is relatively easy.

I mean... I guess he's been in new cars his whole life then? And he manages to come up with the money for it. Good for him? Wonder what sacrifices he made in other areas of his life as a trade.

> It's the last bit of personal expression they have in life.

No it isn't, they chose to make their consumer choices into an identity that needs "expressing." It's just a car. I don't begrudge their choice to want the car they want, I dislike the implication that they're somehow forced into buying it.

>It's the last bit of personal expression they have in life.

Little of column A, little of column "jerks on the internet have these people convinced that using a vehicle anywhere near it's rated capacities let alone beyond them is guaranteed to end in a fiery crash" so they say "oh we might pop out a 2nd kid, better go with the CRV over the HRV" as if the latter can't do both fine.

HN is very much complicit in this pushing of social norms in a direction where people feel like they're slumming it or behaving irresponsibly putting two adults and 3-kids in a 5-seater or towing something recreational with a half ton.

This is the argument everyone was making for small trucks until Ford brought in the Maverick and demand was so high they couldn't keep them on lots. When they bring is right sized vehicles thay don't suck, we but them.

> If they sold well in the US, they would bring in more of them. But they don't.

The auto industry would rather use its limited assembly line capacity for the highest margin products, which are large luxury internal combustion vehicles.

We have long been in the era of lean manufacturing, where assets like factories are hyper-optimized for returns to capital, not for making products to serve all needs or desires. Why lower your gross margins by investing in more factory capacity to make affordable cars? You'd rather put your capital into the Mag-7 to get a higher rate of return.

It also makes sense because with growing inequality in the US, the well-off (or the financially irresponsible) are the only people who buy new cars anyways, so the manufacturers make cars for them.

This is also a big part of the reason they make EVs (which are disproportionately higher end or luxury): because they know that EV buyers are likely to be more well off. The environmental benefits are secondary, and the auto industry has never cared much about lowering TCO or energy costs (those things benefit the EV driver, not the car manufacturer).

No, the big 3 can’t compete. Thats why Chinese cars are straight banned here. Not because of economics

In the 1970s Detroit thought the Honda Civic was a joke as well. How could it ever compete against the Pontiac Astre or the Buick Skyhawk they thought...

that- that ppl go elsewhere- like with the aws rto demands- have serious repercussions, true

In large parts of the country mufflers rust off periodically.

And people pay more taxes for the privilege (you don't think road salt is free do you?)

Well, it is a perfect storm of factors. First of all lack of maintenance. Secondly, people gunning it with the gas pedal. Thirdly, lower income folks in a rush to get to a second or even third job, gunning it for reasons other than just sheer frustration.

hehe good question. But I believe that we are addicted to AI hopium at the moment. You know the drill, circular financing a la Enron, smartest guys in the room stuff. Your intuition will play out but there may be a delayed effect. Seriously I owned TSLA stock for many years. It was boring and frustrating, and I sold. So the Muffler Noise Index may be predictive of what happens years from now ;-)

Farley, the CEO of Ford, keeps pointing this out. He and his management team went to China recently to look at cars and car factories. They were impressed by BYD's cars and terrified by the factory visits. Ford wants to keep exporting trucks from the US, and Farley says that Ford needs to up their game to compete. Latest thinking at Ford is to have three assembly lines side by side, for front, middle, and back of vehicle. Then assemble the three sections. This improves access so you don't have people crawling into the vehicle to install stuff. Robots can do more of the assembly.

Stellantis, is, as usual, screwed up. The only remaining Chrysler product is a mini-van. The Jeeps designed after the Stellantis acquisition are not very good. (A plug-in hybrid with a 21 mile electric range?) The dealers demanded that the CEO of Stellantis be fired for incompetence, which was done. So far it hasn't helped much.

General Motors is still trying to push their "ladder of success": "Start your adventure with Chevrolet", and someday, reach Cadillac. This was a good idea around 1955. General Motors, post-bankruptcy, is a much smaller company than it was before the bankruptcy.

Soon you’ll want Americans to know how good healthcare is in other countries, or that people in many countries get paid time off to move home , or that people in other countries don’t go into crippling debt for education.

No, no. THAT is not acceptable.

I don't even care if china is attempting to surveil me honestly, feels like there are already a dozen American companies trying constantly to collect my data so they can exploit me