Why Americans are suddenly paying $550 per month for new cars

[Alternatepriorities]

This article was sent to me this morning: It makes me a little sad to see how little was learned from the last recession. Worse yet when the next recession comes all the cheap repos will be clown cars we don't want.

https://www.usatoday.com/story/money/cars/2019/03/01/care-payments/3001818002/

"New-car buyers agreed to pay an average of $551 per month for 69 months in January."

WTF? Pete and all of us Mustachians clearly still have work to do.

[jinga nation]

A decade ago, the best-selling segment of vehicles was affordable small cars, like the Ford Focus sedan, she said. Today, it’s entry-level crossovers like the Toyota RAV4 and Ford Escape, which carry starting prices of several thousand more dollars.

I'm driving an entry-level vehicle. Sweet! Best compliment of the week.

[Just Joe]

And the entry level SUVs of today are far nicer than their older versions from 15 years ago. Bigger too.

It is amazing how short the average person's memory is. Politics, pollution, economics, whatever. Every 5 years it seems everything is rebooted.

[Montecarlo]

Another tip: If you can’t afford a midsize SUV, for example, consider a midsize car. The price difference between the average midsize SUV and the average midsize car in January was $38,744 to $25,930, according to Kelley Blue Book.

Pedantry alert.

Spoiler: show

Stating the avg price of two car categories is not a price difference.  It kills me that professional writers do shit like this.

Also, I'm not sure "if you can't buy something that you can't afford, buy something you can" counts as a tip.  At least they didn't call it a life hack.  "Life hack: buy a midsize car, instead of an SUV that will be repo'd in 18 months!"

[RFAAOATB]

This is about in line with what I'm paying for my car.  About $580x63 for a 2019 Subaru Ascent.

[Abe]

Wow that's a lot. I have been hard-pressed to spend that kind of money on an SUV. My wife and I have only bought two cars in our lives, but both times we had zero interest in the fancier versions. Anything above the base model seems like wasted money. We also don't spend more than 10-15 minutes per day in the car, so what do we know?

[eljefe-speaks]

I feel SOOOOOO much better now about that small amount of debt I took on do buy my dream motorcycle.

This quite caught my eye:

"The good news is the average consumer has 'a very healthy balance sheet' right now, said Lakhbir Lamba, executive vice president of retail lending at PNC."

This is not supported by evidence in the article and is incongruous with that tidbit we have all heard recently about how the average American would not be able to come up with some small amount of cash in the case of an emergency. Maybe Americans have a good amount of equity in their homes right now, but a large portion of that would be offset by the very subject of the piece: vehicle debt. I wouldn't consider my balance sheet healthy unless I had a strong amount of liquidity.

[talltexan]

I've spent the past few minutes discussing my co-workers's situation with her car. She's 37 months into a 48 month lease, and just tripped over the maximum miles. Her monthly payments are about $360, but--if she continues driving at her current rate--she'll add a little over six extra payments over the the next year for those miles. It's difficult for her to make a change to a different car without having a substantial pot of money on-hand.

[I'm a red panda]

I had no idea car loans lasted for so long. I thought a car loan was typically 2-3 years?

[FIRE@50]

I've spent the past few minutes discussing my co-workers's situation with her car. She's 37 months into a 48 month lease, and just tripped over the maximum miles. Her monthly payments are about $360, but--if she continues driving at her current rate--she'll add a little over six extra payments over the the next year for those miles. It's difficult for her to make a change to a different car without having a substantial pot of money on-hand.

I'm guessing that buying the car at the end of the lease will be her best option.

[zolotiyeruki]

I had no idea car loans lasted for so long. I thought a car loan was typically 2-3 years?

Not any more.  84-month loans are pretty common nowadays.  It's nuts.

To compare, I bought my Corolla 16 years and 140k miles ago for $4500.  That's less than one year's worth of average payments.

[Just Joe]

And its not like there is a shortage of alternatives to the "very, very expensive" option.

[RFAAOATB]

And its not like there is a shortage of alternatives to the "very, very expensive" option.

What makes me grumble is I took the moderately expensive option because the less expensive options didn't suit us and I just couldn't justify the very very expensive option (Lincoln Navigator).

I have to remind myself that my dad is a couple of decades older than me and I might have to wait that long until I get a luxury tier SUV.

[NorthernMonkey]

My car payment was £500, that's about $650

It was only one payment though. I'm quite happy with my 12 year old VW

[SwordGuy]

"New-car buyers agreed to pay an average of $551 per month for 69 months in January."

It continually boggles my mind.

That's literally 2 car payments for the most expensive two cars we ever bought.  Those were the last new cars we bought and were only for 60 months.

I've bought 3 different rental homes, each for less than one average new car at that price.

Some people buy fancy cars.  I buy houses and stock.

[JAYSLOL]

I had no idea car loans lasted for so long. I thought a car loan was typically 2-3 years?

Not any more.  84-month loans are pretty common nowadays.  It's nuts.

To compare, I bought my Corolla 16 years and 140k miles ago for $4500.  That's less than one year's worth of average payments.

In Canada for the last 4 or 5 years now I've stopped seeing any loan for under 84 months advertised, it's the new standard loan (as far as ones being advertised anyway), and I also see the odd 96 month loans popping up. 

[RWD]

I probably shouldn't say what my monthly payment is on our used car here...

[Alternatepriorities]

"New-car buyers agreed to pay an average of $551 per month for 69 months in January."

It continually boggles my mind.

That's literally 2 car payments for the most expensive two cars we ever bought.  Those were the last new cars we bought and were only for 60 months.

I've bought 3 different rental homes, each for less than one average new car at that price.

Some people buy fancy cars.  I buy houses and stock.

That's a good point I hadn't thought about. It's only in the past year that I've ever spent more than $550 a month on rent or a mortgage...

[Alternatepriorities]

I had no idea car loans lasted for so long. I thought a car loan was typically 2-3 years?

Not any more.  84-month loans are pretty common nowadays.  It's nuts.

To compare, I bought my Corolla 16 years and 140k miles ago for $4500.  That's less than one year's worth of average payments.

In Canada for the last 4 or 5 years now I've stopped seeing any loan for under 84 months advertised, it's the new standard loan (as far as ones being advertised anyway), and I also see the odd 96 month loans popping up.

8 Years? wow. I've wondered about that before when I drive through Canada. When exchange rates swing and the US Dollar suddenly buys 1.25 Canadian is the price of vehicles really 25% higher in Canada? Or could I get a screaming deal on my next used car buying it BC instead of the Lower 48 and driving it up?

[Alternatepriorities]

My car payment was £500, that's about $650

It was only one payment though. I'm quite happy with my 12 year old VW

Years ago a few months after started my first engineering job after college a coworkers gave me some good natured crap about my old (admittedly junky) car. He told me I was an engineer now and could afford a new car... I just told hime I really didn't want a new car payment. After working there two years I did finally buy a new (to me) car. He complimented me on how nice it was and asked what my payment was. I told him the total amount I paid for it... He was genuinly confused for a second before it dawned on him that I'd paid cash. He didn't even know that was an option. The story has a happy ending though. I've done some contract work for the company lately and he's free of consumer debt driving a paid for car and just about to take a payout to work his dream job.

[westcountrybeerman]

It's just as bad in the UK, I know multiple people paying up to £500pcm for a flashy GTI/GT/SR/*insert high spec stupid tag here* who struggle to pay rent and bills.

I've got a VW Golf GTI that goes like a rocketship… cost me £700 cash and is a mere 18yrs young... will do 70mph+ in 2nd gear!

[lizzzi]

I don't know anybody in my apartment complex who has paid cash for a vehicle except me. They drive much newer, nicer cars than mine, but are mostly leasing for $300-$400 per month. I think they are just crazy. All that money, and they don't even own their own cars. They think getting a new car means taking out a new lease--then they all ooh and aah over each others new (i.e. leased) cars. I so don't get it.

[Just Joe]

I've never lived up north in the salty states but after 84 months or 96 months, aren't cars starting to rust away?

[Alternatepriorities]

I've never lived up north in the salty states but after 84 months or 96 months, aren't cars starting to rust away?

Improvements in metallurgy and paint along with the increased use of plastics have helped a lot with that. I bought my last vehicle down south and drove it up, but that was mostly because it’s a beautiful drive and it saved me $1,500.

[oldtoyota]

I had no idea car loans lasted for so long. I thought a car loan was typically 2-3 years?

Not any more.  84-month loans are pretty common nowadays.  It's nuts.

To compare, I bought my Corolla 16 years and 140k miles ago for $4500.  That's less than one year's worth of average payments.

I like your choice of car. ;-)

[zolotiyeruki]

I had no idea car loans lasted for so long. I thought a car loan was typically 2-3 years?

Not any more.  84-month loans are pretty common nowadays.  It's nuts.

To compare, I bought my Corolla 16 years and 140k miles ago for $4500.  That's less than one year's worth of average payments.

I like your choice of car. ;-)

Thanks! :) But I'm not sure 225k miles (what it has now) qualifies it as "old" yet.

[talltexan]

It's just as bad in the UK, I know multiple people paying up to £500pcm for a flashy GTI/GT/SR/*insert high spec stupid tag here* who struggle to pay rent and bills.

I've got a VW Golf GTI that goes like a rocketship… cost me £700 cash and is a mere 18yrs young... will do 70mph+ in 2nd gear!

Did anybody else read this post and think about that old song, "When I was in my cadillac...what to my surprise [beep, beep]? A little Nash Rambler was following me, about 1/3 my size..."

[NorthernMonkey]

I don't know anybody in my apartment complex who has paid cash for a vehicle except me. They drive much newer, nicer cars than mine, but are mostly leasing for $300-$400 per month. I think they are just crazy. All that money, and they don't even own their own cars. They think getting a new car means taking out a new lease--then they all ooh and aah over each others new (i.e. leased) cars. I so don't get it.

My Boss spent last week telling anyone about the amazing deal he got on a brand new BMW x5. It comes with all the extras, and because him and his wife now work in the same office, they can get rid of her car at £200 a month, and his car at £500 a month, so the new one is only £100 more than the other two, at £800 a month. It's such a good deal!

[I'm a red panda]

I've never lived up north in the salty states but after 84 months or 96 months, aren't cars starting to rust away?

I live in a snowy state with lots of salt on the road.  We consistently keep our cars 10-15 years. And the dealers happily take them as trades.
We just rinse them off at the end of the season.

[Bracken_Joy]

I've never lived up north in the salty states but after 84 months or 96 months, aren't cars starting to rust away?

Even if they did, most people will just use that as an excuse to trade in early and roll their "negative equity" forward onto their next loan.

[DadJokes]

I feel SOOOOOO much better now about that small amount of debt I took on do buy my dream motorcycle.

This quite caught my eye:

"The good news is the average consumer has 'a very healthy balance sheet' right now, said Lakhbir Lamba, executive vice president of retail lending at PNC."

This is not supported by evidence in the article and is incongruous with that tidbit we have all heard recently about how the average American would not be able to come up with some small amount of cash in the case of an emergency. Maybe Americans have a good amount of equity in their homes right now, but a large portion of that would be offset by the very subject of the piece: vehicle debt. I wouldn't consider my balance sheet healthy unless I had a strong amount of liquidity.

A lender not seeing a problem with all of the debt consumers take out? Well color me shocked.

[Daisyedwards800]

This kills me. My friend, who is a teacher, makes $90k in a high cost-of-living area, perhaps the highest in the U.S.  She just financed a new car for $570 a month.  Her insurance went up also.  I just can't get over that she continually makes these same mistakes and justifies it.  It is sad.

[TheGrimSqueaker]

I had no idea car loans lasted for so long. I thought a car loan was typically 2-3 years?

Not any more.  84-month loans are pretty common nowadays.  It's nuts.

To compare, I bought my Corolla 16 years and 140k miles ago for $4500.  That's less than one year's worth of average payments.

In Canada for the last 4 or 5 years now I've stopped seeing any loan for under 84 months advertised, it's the new standard loan (as far as ones being advertised anyway), and I also see the odd 96 month loans popping up.

8 Years? wow. I've wondered about that before when I drive through Canada. When exchange rates swing and the US Dollar suddenly buys 1.25 Canadian is the price of vehicles really 25% higher in Canada? Or could I get a screaming deal on my next used car buying it BC instead of the Lower 48 and driving it up?

Unlikely: car safety regulations in the United States are deliberately tweaked to ensure that any vehicle bought outside the USA has "safety flaws" that require expensive modifications before the vehicle can be legally imported and registered.

[Just Joe]

Because that 2019 Peugeot or Skoda is certainly more unsafe than a Harley-Davidson... Yep - safety is the reason...

[JLee]

I had no idea car loans lasted for so long. I thought a car loan was typically 2-3 years?

Not any more.  84-month loans are pretty common nowadays.  It's nuts.

To compare, I bought my Corolla 16 years and 140k miles ago for $4500.  That's less than one year's worth of average payments.

In Canada for the last 4 or 5 years now I've stopped seeing any loan for under 84 months advertised, it's the new standard loan (as far as ones being advertised anyway), and I also see the odd 96 month loans popping up.

8 Years? wow. I've wondered about that before when I drive through Canada. When exchange rates swing and the US Dollar suddenly buys 1.25 Canadian is the price of vehicles really 25% higher in Canada? Or could I get a screaming deal on my next used car buying it BC instead of the Lower 48 and driving it up?

Side note, the exchange rate is currently $1 USD to $1.34 CAD.

[Alternatepriorities]

Side note, the exchange rate is currently $1 USD to $1.34 CAD.

I guess it's been a while since my last trip.

[Alternatepriorities]

Unlikely: car safety regulations in the United States are deliberately tweaked to ensure that any vehicle bought outside the USA has "safety flaws" that require expensive modifications before the vehicle can be legally imported and registered.

Yeah after looking up the details it's probably more of a pain than it would be worth an anything in my price range. The requirement is waved on vehicles more than 25 years old though...

[K-ice]

Just this morning we were roughly calculating the monthly cost of our car. (Not including gas, insurance etc.) 

Price paid/months owned = monthly cost 

It was an unmustacian CASH purchase a while ago. It is a bit sobering to see it has cost us about $350 a month.  Of course, the longer we keep it the less it costs. It also still has some resale value so that we were not taking into account.

For fun I looked at buying a new car from the same dealer. I was tempted by the 0.5% financing.  But they also offer -$1000 for a cash purchase. Looking at the math that 0.5% is more like 4.8% if you took the cash price as your PV.  Although the rental car financing seams tempting, always check the fees and actual difference with a cash payment.

Anyway, we plan to hang onto this car for a few more years.

[martyconlonontherun]

Because that 2019 Peugeot or Skoda is certainly more unsafe than a Harley-Davidson... Yep - safety is the reason...

Planet Money did a podcast on this and IIRC, their conclusion was that car makers hate these laws and would rather there be universal standards. The issue is getting Americans and Europeans agreeing on the laws that are similar but different.

[martyconlonontherun]

Wonder what the average used car payment is? Yea, $550 is bad but at least you are getting a car that could last awhile and is nicer. Used car payments are usually inflated due to bad credit.

[RWD]

Wonder what the average used car payment is? Yea, $550 is bad but at least you are getting a car that could last awhile and is nicer. Used car payments are usually inflated due to bad credit.

About half a year ago the average used car payment was $378.
https://jalopnik.com/the-average-used-car-payment-is-now-378-per-month-1828725332

I think it's important to note the inherent statistical bias in these numbers. The $550/month figure is an average of Americans that buy a new car and finance it. That number doesn't go down when more people buy their cars in cash. Or when fewer people buy new cars (new vehicle sales are up 20% over the last five years so maybe we should ridicule that instead). Because those people are not part of the dataset. It will only go down when the people choosing to finance their new cars choose cheaper cars. And inflation obviously is working against that. Even a new Corolla is $300+/month now.

[Alternatepriorities]

My sister (who makes me look like a free spender) started a conversation this morning about calculating the real price of a vehicle when dealerships are offering a 0% loan. They can't borrow the money somewhere else and then let the buyer use it interest free so the cost of the loan must be built into the price. Does anyone know of a good method or an online calculator for that? My current approach is just the treat the payments as an annuity and calculate the present value at whatever interest rate I assume the manufacture wants to make...

Our conversation also reminded me of an FU money story on car loans... A FI friend took a 0% loan when they wouldn't reduce the price (similar to MMM's story with the leaf). A couple months in they then tried to raise the rate because (BS regarding paperwork). He told them if the changed the rate he'd pay the loan off immediately. They told him "that's impossible, nobody can pay of a car overnight". He told them he could and he would and suddenly paperwork problem was solved. I still don't know why they wanted to loan money at 0% based on my above theory they should have let him pay it off since the price had already been agreed.

There should be a line on mustachian credit reports that says "I have FU money and I know how to use it".

 

[K-ice]

My sister (who makes me look like a free spender) started a conversation this morning about calculating the real price of a vehicle when dealerships are offering a 0% loan. They can't borrow the money somewhere else and then let the buyer use it interest free so the cost of the loan must be built into the price. Does anyone know of a good method or an online calculator for that?

I did some math on my own the other day.

For fun I looked at buying a new car from the same dealer. I was tempted by the 0.5% financing.  But they also offer -$1000 for a cash purchase. Looking at the math that 0.5% is more like 4.8% if you took the cash price as your PV.  Although the rental car financing seams tempting, always check the fees and actual difference with a cash payment.

Here is what I did using excel RATE=(nper,rate,pv). 

First I double checked rate (0.5% in my case) with the term (2y), total sale price (24219.56), and payment (-1014.44)

rate = 12*RATE(2*12, 24219.56, -1014.44)  = 0.5%   OK so it checks out.


Then I entered the discounted price (-$1000 + tax) they were offering for a "cash" sale (23169.56) the same term & payments.

rate = 12*RATE(2*12, 23169.56, -1014.44)  = 4.8%


So to someone who has the cash and thought 0.5% is a great rate now borrowing doesn't look so good anymore.

You could also very quickly look at the total paid difference.  24*$1014.44 - $23169.56 = $1170.02  more.

[kimmarg]

I've never lived up north in the salty states but after 84 months or 96 months, aren't cars starting to rust away?

I'd say about 10 years is when the road salt starts tearing at the frame. cosmetic rust is one thing but stick your fingers through the side wall is another

[Holyoak]

Wonder what the average used car payment is? Yea, $550 is bad but at least you are getting a car that could last awhile and is nicer. Used car payments are usually inflated due to bad credit.

About half a year ago the average used car payment was $378.
https://jalopnik.com/the-average-used-car-payment-is-now-378-per-month-1828725332

I think it's important to note the inherent statistical bias in these numbers. The $550/month figure is an average of Americans that buy a new car and finance it. That number doesn't go down when more people buy their cars in cash. Or when fewer people buy new cars (new vehicle sales are up 20% over the last five years so maybe we should ridicule that instead). Because those people are not part of the dataset. It will only go down when the people choosing to finance their new cars choose cheaper cars. And inflation obviously is working against that. Even a new Corolla is $300+/month now.

Ironic, I was just telling someone similar yesterday.  Manufacturers keep jacking the cost up at a crazy rate, adding new trim lines to really jack up the cost, and diminish previous trim lines value (looking at you Mazda), and extending the loan term to keep asses in new leatherette seats.  "C'mon man, what monthly payment can you swing"...  Fucking madness, and cash does nothing for you/no cut for the dealer via their financing/financing provider. 

I know about all of the great 'tech' (blech), and safety BS new cars come with...  But a base new RAV4 AWD with steel wheels, plastic hubcaps, no pwr seat anywhere, and a 4 cyl engine is $30k...  $30k for that shit?  Hey, at least you get a urethane gear shift knob to enjoy for the next 8 years of your loan.  Oh well, record number of folks 90 days or more late on their payments, maybe my cash can get spent soon for pennies on the dollar.

I've never lived up north in the salty states but after 84 months or 96 months, aren't cars starting to rust away?

I'd say about 10 years is when the road salt starts tearing at the frame. cosmetic rust is one thing but stick your fingers through the side wall is another

And repairs become far more difficult and expensive due to rust seized parts that break off, rather than unbolt.  Oh yeah, ask Toyota about frame rust.  I have seen several times behind a Toyota service building, stacks of new frames ready to be installed for their trucks.  Literally a frame up replacement, where all parts are stripped from the old truck, and bolted to the new frame.  Man, did Toyota eff that one up.

[jinga nation]

I know about all of the great 'tech' (blech), and safety BS new cars come with...  But a base new RAV4 AWD with steel wheels, plastic hubcaps, no pwr seat anywhere, and a 4 cyl engine is $30k...  $30k for that shit?  Hey, at least you get a urethane gear shift knob to enjoy for the next 8 years of your loan.  Oh well, record number of folks 90 days or more late on their payments, maybe my cash can get spent soon for pennies on the dollar.

What one should do (and what I did) is use the 'Days on Market' filter on CarGurus to find 'lot-sitters'. Then go in and negotiate on that particular vehicle. I set the filter to 60-100 days. Do this on new and used cars. Many of the young dealer sales people use the same cargurus app, so the negotiation basis is transparent and pretty much a hassle-free quick yay/nay. I was able to find several >60day used RAV4s (still under manufacturer warranty) sitting in dealer back lots. One hour from walking onto the lot to driving away. Negotiation time was under 10 minutes, straight up told them no funny games or I have a to go to competitor 3 miles down the road.

Bought a 1.5 year old RAV4 FWD with 15,000 miles on the odo for USD 20k out the door. Dealer desperate to get rid of the 7 he had sitting around. Had my uncle do the same. Told some co-workers about it, one jumped and got a slightly better deal. (I'm so proud of him, sniff.)

But yeah, prices are whacky on new vehicles, even the base model RAV4s and CR-Vs due to the stupid crazy demand, they are the best-sellers.

So I'm looking at the new Honda Insight for my wife, they're just sitting on lots.

[Holyoak]

Hey Jinga, I LOVE the days on lot filter, as well when used in conjunction with the price history graph.  I mentioned earlier on MMM, about how dealers/Toyota USA were giving huge discounts on even brand new 18 Ravs, expecting many more people (especially men) to gravitate towards the 19's much more 'masculine' look and marketing campaign.  They and I both fully expect sales to be 500k plus, keeping it as the No 1 vehicle sold in the USA, outside of trucks.  License to print money, and keep slaves in bondage 8 years at a time.

FWIW, two days ago I looked at Mazda CX-5's, and although a bit smaller, and a smidge less power, represented to me a much, much greater value, and all of them are made in Japan (many Ravs are made in Canada).  I mean look at this:

https://www.preston-mazda.com/inventory/new-2019-mazda-cx-5-touring-awd-4d-sport-utility-jm3kfbcm3k0514839

The $28,500 asking price vs the base Rav4's $30,000 price gets you:

- Alloy wheels
- Leatherette seats, not those horrible looking, cheap seat cover looking seats in the $30k base Rav4
- Radar cruise control
- Heated 6 way power driver seat
- Dual zone automatic A/C
- Fwd collision automatic braking
- Even a leather wrapped shift knob :)

Etc, etc...  I want this exact model and color in a 17, but no dice so far.  Going to the Grand Touring trim is simply, and absolutely embarrassing for Toyota, and reliability is top notch for the Mazda as well.  I always spec AWD, as you can not find anything but that here in NW PA, and resale for just FWD would take a huge hit (not that FWD wouldn't be OK for many).

[NorthernMonkey]

All this talk of $30k cars is insane.

I'll stick with my 2 week rule. Never spend more than 2 weeks (after tax) earnings on  a car, and just replace them every 2 years when they get scrapped

[Just Joe]

We have a two week car too. However depending on how much driving a person does, it might be important to have one nice car and one cheap car.

I trust our older car but if going out of state I want to drive our newer car. If facing potentially dangerous weather I want to be in our newer car. If traveling 100 miles from home in typical weather conditions, the older car is fine. The older car is a great short distance or commuter car. Crossing the midwest in 15F weather - I want something newer.

[JLee]

Wonder what the average used car payment is? Yea, $550 is bad but at least you are getting a car that could last awhile and is nicer. Used car payments are usually inflated due to bad credit.

About half a year ago the average used car payment was $378.
https://jalopnik.com/the-average-used-car-payment-is-now-378-per-month-1828725332

I think it's important to note the inherent statistical bias in these numbers. The $550/month figure is an average of Americans that buy a new car and finance it. That number doesn't go down when more people buy their cars in cash. Or when fewer people buy new cars (new vehicle sales are up 20% over the last five years so maybe we should ridicule that instead). Because those people are not part of the dataset. It will only go down when the people choosing to finance their new cars choose cheaper cars. And inflation obviously is working against that. Even a new Corolla is $300+/month now.

Ironic, I was just telling someone similar yesterday.  Manufacturers keep jacking the cost up at a crazy rate, adding new trim lines to really jack up the cost, and diminish previous trim lines value (looking at you Mazda), and extending the loan term to keep asses in new leatherette seats.  "C'mon man, what monthly payment can you swing"...  Fucking madness, and cash does nothing for you/no cut for the dealer via their financing/financing provider. 

I know about all of the great 'tech' (blech), and safety BS new cars come with...  But a base new RAV4 AWD with steel wheels, plastic hubcaps, no pwr seat anywhere, and a 4 cyl engine is $30k...  $30k for that shit?  Hey, at least you get a urethane gear shift knob to enjoy for the next 8 years of your loan.  Oh well, record number of folks 90 days or more late on their payments, maybe my cash can get spent soon for pennies on the dollar.

I've never lived up north in the salty states but after 84 months or 96 months, aren't cars starting to rust away?

I'd say about 10 years is when the road salt starts tearing at the frame. cosmetic rust is one thing but stick your fingers through the side wall is another

And repairs become far more difficult and expensive due to rust seized parts that break off, rather than unbolt.  Oh yeah, ask Toyota about frame rust.  I have seen several times behind a Toyota service building, stacks of new frames ready to be installed for their trucks.  Literally a frame up replacement, where all parts are stripped from the old truck, and bolted to the new frame.  Man, did Toyota eff that one up.

Ehhh.  Dana (the frame manufacturer) messed that one up.  Maybe Toyota could've tested more thoroughly, but the frame rust issue has a specific root cause (inadequate rust proofing from the Dana factory).

https://www.torquenews.com/106/dana-corp-ordered-pay-toyota-25m-frame-rust-issues
https://autoweek.com/article/recalls/toyota-frame-settlement-could-cost-company-34-billion