The average transaction price for a new car in the United States almost reached $50,000 this year and has stubbornly refused to recede, hovering around $48,000 for most of 2024. Even with increased incentives, the lack of affordable financing has made it harder for people to buy cars. That’s changing just a little bit.
Have you ever gone to a wedding or any big event with a buffet and they clearly have a few extra chafing dishes at the end so they fill it with super random stuff? It starts out normal, with chicken, some form of green bean, a potato done in an extra fancy way, some kind of half-assed vegetarian option, and maybe a prime rib if the parents really want the wedding to stick. But then it’s pork egg rolls, eggplant parm, and saag paneer to round it out.
I’m not complaining! One of the best weddings I’ve ever gone to had the most chaotic food choices and it was a blast.
That’s The Morning Dump today. I have no big thought that ties everything together. First up is car financing, then some VW union news, followed by the revelation that the alleged UHC CEO killer worked in the car industry, and then I’ll share a news report about Stellantis that I did right before Tavares got canned.
Great Deals Abound For Certain Cars
I think the story of the car market this year has been one of rebounding inventory, stale products, too many electric cars, and not enough cheap financing. With the Fed finally lowering rates and the economy maintaining its steam, automakers are becoming more aggressive with car loans.
“Auto loan rates are declining, with the average used rate at 13.76% and new rate at 9.12%,” according to economist Jonathan Smoke at Cox Automotive, who adds that there’s a lot more low-interest lending as “lenders become more aggressive.”
This summer, the best financing was probably on cars you didn’t necessarily want. Assuming you had decent credit, there was a Nissan dealer somewhere willing to sell you a Rogue at a good rate. That’s still true today, as CarEdge points out, with Nissan offering 0% financing for 60 months.
It’s not just Nissan in the game. Mazda has offered competitive financing deals all year and now could give you 0.9% financing for 60 months on any version of the very good CX-90, including the plug-in hybrid.
If you want a pickup truck, both the Toyota Tundra and Ram 1500 are competing for the title of “the other truck” people buy. Toyota is doing 1.99-2.99% financing for up to 72 months as well as cash-on-the-hood. Ram is offering 15% off MSRP and 0.9% financing for 72 months on the 2024 Big Horn.
Even Subaru is in the game, with the slower-selling 2024 Outback getting 2.9% financing for 72 months. While I didn’t love my Forester, Subarus are still great cars, and the Outback, in particular, is a uniquely cool vehicle.
As always, these deals are reliant on region, dealer, and your own credit. The existence of all these deals, plus other factors, makes me think December car sales are going to be quite high this year. This is especially true if you’re willing to buy a 2024 MY vehicle and overlook the 2025 that just arrived on the lot.
Volkswagen And Union Continue To Talk, Continue To Make Little Progress
I have a lot of dumb ideas for how automakers should act that I explain on this blog. Do I have an idea for how Volkswagen can extract itself from its current mess? I do not. Specifically, I do not know how to bridge the divide between Volkswagen and its union, IG Metall, in Germany.
It turns out that I’m not alone. Volkswagen can’t figure it out, either. Here’s what the company is saying:
Arne Meiswinkel, chief negotiator at Volkswagen AG, said: “Today’s discussions were constructive, but we remain significantly apart on a solution. However, further collaboration is needed to identify additional financial opportunities. The goal remains to find short-term and sustainable measures to reduce costs in order to secure the company’s competitiveness in the long term.”
The employee side had submitted a counter-proposal in the previous round of negotiations, which signaled its openness to a financial contribution from employees. The company welcomed this step, but pointed out that this proposal was not sufficient to ensure a sustainable reduction in costs.
Basically, Volkswagen wants to close plants. The union wants to do anything but close plants. Volkswagen is not as competitive in Europe, North America, or just about anywhere as it once was. It probably needs to close plants to deal with its overcapacity.
Unfortunately, Volkswagen promised its workers years ago that it wouldn’t close plants and the German political system is partially built on VW employment in what used to be East Germany.
Good luck with all that.
There’s Always A Car Angle
I was tempted to avoid this one, but it’s news so I’ll do it quickly. As some of you have pointed out, the person suspected of killing United Healthcare CEO Brian Thompson in an assassination in New York City did work for the popular car-buying website TrueCar.
According to Automotive News, the alleged killer was not working there when the murder occurred:
Mangione joined the vehicle listings company as a data engineer in November 2020, according to his LinkedIn page. But he hasn’t worked for the company in nearly a year, a TrueCar spokesperson told Automotive News via email.
“While we generally don’t comment on personnel matters, we confirm that Luigi Mangione has not been an employee of our company since 2023,” the spokesperson said.
And that’s enough of that.
What Happened To Jeep?
I did an interview with the non-profit news organization More Perfect Union about Carlos Tavares and Stellantis’ recent woes. You can see the video above (or linked here). I think it turned out well, though I did the interview before Tavares resigned, so that was fun timing.
Please enjoy me dressing like Sergio Marchionne. [Editor’s Note: Matt has pointed this out to me a couple times, and I think it may be the subtlest, nearly-imperceptible, deepest cut/in-joke that we’ve ever had here. I just thought Matt was wearing gonna-be-on-camera Matt clothes, but then again, I always mention Carl Sagan when I wear a turtleneck and blazer, so I’m really no better. – JT]
What I’m Listening To While Writing TMD
The Foo Fighters video for “Big Me” is absolutely one of my all-time favorites. I was thinking about this recently after I saw this viral clip about Christopher Walken unwittingly mispronouncing the band’s name. Now my wife and I will sometimes blurt out “Foo Fighters” in our worst Walken impression, just for lolz.
The Big Question
What’s the best deal you’ve ever gotten on a car?
Thirteen and three-quarters to finance a used car?! That blows my mind.
In 2019, I bought a new 2018 Buick TourX Essence (fully loaded, minus the panno roof), for just a hair over $28k or about $20k off MSRP. It had been a manager’s loaner, so it had about 3k miles but was otherwise perfect. Two years later, I traded it in for $26k. When you factor in the reduction on the taxable sale price for the next purchase, I basically drove the Buick for free for two years.
I regret missing the boat on the Great TourX Selloff.
I’ll see the odd one for sale here and there and am shocked at the asking prices. Wagon people want their wagons.
In 1971 16 year old me bought a 1963 Valiant convertible for $300. I sold it several years later for $350.
Unfortunately this was the height of my purchasing prowess. On the other hand I spent nothing on buying cars for 36 years living in Manhattan.
Best deal I’ve ever gotten? My 2006 GMC Sierra crew cab, was under $22k out the door, brand new, including tax and an extended warranty long enough to insure I would never have to deal with repairs and payments at the same time. Since then, it has never left me stranded, nor have I ever had a repair bill on the high side of $600, with the exception of when I had the rusty rocker panels redone.
Even at 0%, there are no new cars that I want currently that I would actually buy. Sigh. Closest is a Jeep Gladiator, which I have a completely irrational liking for, because I think they are both silly and I don’t have the slightest need for one – but I want one anyway. Just not enough to spend the money. Maybe when I can get a used one for couch cushion money I will indulge myself. Or if my Disco I blows up.
Best deals on cars:
With the exception of my first new car, a leased ’02 Golf GLS TDI that I got raped on not knowing any better, I have never bought a new car for myself unless it was a screaming deal. If it’s not a deal, I just don’t need it that badly. Even the MSRP -rebate I paid for my mother’s Soul two years ago was a good deal for the time. And I needed to not have to deal with my mother’s car dilemmas, so it was worth every penny.
For used stuff:
I have bought LOTS of used cars that in hindsight were not good deals, of course.
Had a Gladiator for 2 months while on a job assignment. Very fun to drive but chugged gas and the driver’s side was hella cramped. Would not purchase.
I had one as a rental and loved it. Just not quite enough to open my wallet given what they cost, given I already have a 4×4 and have no need whatsoever to replace it. If they were <$30K for a base model with a hardtop and a stick, maybe. If they made one with two doors and a more useful length bed, even more likely. A modern “Extra cab” Ranger is what I really want, not a four door sedan with a back porch.
Compared to the ’95 Land Rover Disco I have now for that position in my fleet a V6 Wrangler might as well be a Prius, and I wouldn’t drive it enough to care anyway.
My best deal was when I had an ’80 something VW Rabbit that blew it’s head gasket. The mechanic offered me $350 or I could pay him $1000 plus for repair. I took the money, walked out to the road and put out my thumb. The guy who picked me up said his daughter had a car that she wanted to sell. So we swung by his house and there was a ’84 Chevy Citation. I offered the daughter the $350 and she took it. I left home in a red Rabbit and came home in a red Citation. I don’t think my girlfriend even noticed. The Citation turned out to be a pretty good car. I drove it for a couple years and sold for more than I paid.
You know, I got some pretty good lease deals in the 90s on my Jeep Grand Cherokees and I picked up my ’88 Jag for $5600 in 2017 in really pristine shape. However, I kind of think my best deal ever was on my 2018 Ford Fiesta ST.
The car’s MSRP was $23,400 or thereabouts and they knocked $6k off of sticker; even in the high tax and registration fee environment of California I got the car out the door for $19,500. I’ll always remember the sales guy expressing surprise – “you sure you want the Fiesta? I mean, your credit would let you buy anything on this lot except for the GT.” No, I really wanted the FiST.
Despite Ford’s reputation for quality being job 12 or whatever I have put nothing but regular maintenance and consumables into the car for over six years. The worst problem I ever had was having to turn the car off and on again to reset the SYNC system, and that only happened once. Meanwhile, the ability to drive it like a maniac without getting traffic tickets has made it the perfect stealth hooligan car and I love it.
My old man got one of those cheap lease deal Cherokees. A ’92 Larado in that dark green with silver that so many of them were. He got it because a nephew got one and was raving about what a deal it was. I LOVED that thing as a college kid. When the lease was up after two years, he got one of the very first Ford Windstars. Lovely, but what an epic turd it ended up being mechanically. He should have kept the Jeep.
I looked at and liked the FiST, but bought a Fiat 500 Abarth. It was just more fun, and even cheaper. But that was as a 4th car just for fun – for a daily for sure the Ford would be a far better choice. Loved that silly little thing though, another car I wish I still owned. Siren song of doing European Delivery again had me selling it to order an M235i. That I didn’t love.
The residual values were set so high on those Grand Cherokee leases that they were a screaming deal payment-wise, but it would have been utterly stupid to buy out the leases despite how much I loved those cars. I was leasing at the time because my company made that the attractive option.
Of course, that is how they made them so cheap. Classic subventing of the lease – and I am sure the money factor was LOW as well. But he still would have been better off buying out the Cherokee (or buying another one) than buying that Windturd. Great design for the day, woefully executed.
No way that’s the guy who whacked that parasite CEO! He was hanging out with me the whole day. We were just hiking in the woods, so there’s no one else to corroborate, but I’ll swear to it in court.
A number of my cars were good deals:
’84 Subaru: $500 for 3 years of continual abuse. So cheap, it makes the manual ’83 sedan seem like a rip off at $1200, which it wasn’t.
’90 Legacy 5MT FWD wagon $3200. Bought it at 107k and beat the hell out of it for about 165k more miles. It’s the one car I wish I could have kept forever, but rodents and cancer prevented that.
’12 Focus SE 5MT hatch for a couple hundred over $20k. Corolla reliable for over 200k miles until assholes crashed into it.
’16 Focus ST for a couple hundred over $23k. Just as reliable as the SE until the Ecoboom problem resulted in burning coolant at about 180k.
’22 Toyota GR86 6MT OTD for under $30k, exactly what I wanted.
Best deal I’ve ever gotten on a car was my second saab 9-5. 2004 Arc (uncommon luxury trim) wagon. Bought it in I think 2016 from friends of my parents with 110k on the odometer for for a thousand bucks. I loved that car.
The best deal I ever got on a car was my Maverick. I ordered it and when I picked it up I paid MSRP. This was when they were routinely selling for $5K+ over MSRP.
Best deal I ever gave on a car was when I sold my Yaris to a friend for $6K. He drove it two years and sold it for $6500.
The dealer I got my Maverick from told me that they almost hoped people would back out of their Maverick orders because they had no way to get inventory and that way they could mark them up. They made it sound like Ford was very adamant that people placing orders should pay MSRP, and it’s not like an order was really all that much work for the dealership anyway.
Yeah, my dealer gave me three days to take delivery after they notified me. If I had not taken it, they would have slapped 5 – 10K on it and sold it the next day.
That’s crazy. Mine didn’t do anything like that, in fact they forgot to tell me when it was ready for a couple days.
I had a coworker who ordered an F-250 and they told him the same thing. It got delivered the day after he had knee replacement surgery so it was a whole situation for him to get down there and sign the papers when normally they wouldn’t have given a shit. But at the time inventory was low because of the chip shortages (this was when they were reporting 10s of thousands of trucks sitting in holding lots waiting for parts) and this was probably the only XLT they’d seen in months so they knew they could mark it up and sell it in an instant when everything else on the lot was Platinum King Ranch Offroad FX-4 models.