The car market is bonkers!!!

[Duke03]

Before the face punches please hear me out... 6 months ago I ordered a new pickup truck through a trusted dealer.  This dealership will sell any ordered unit at invoice pricing with zero-mark ups and no add ons. My truck finally arrived last week, and I went to get it.  I was shocked to find out that on top of invoice pricing and my unit being price protected even though MSRP has risen $3600 since I ordered it the dealership found that I qualified for $5000 in rebates.  They themselves where shocked and said they double checked it 3 times just to make sure because it had been over 2 years since they have seen anyone qualify for that much in rebates. I was buying a truck that had a sticker price of $65,000 for $53,xxx.  After TTL and the $150 doc fee I walked out paying $57260.  Here is where things get crazy.  After I finish up in the finance office the sales manger comes in and ask if I'd like to make an easy $5000.  I give him a look and he explains that if I allow the dealership to pay my truck off that I just bought and walk away he'd cut me a check for $5000 right now.  He said he would then list the truck as a used unit with 5 miles on it and sell it for MSRP in less than a day.  I was kind of shocked and almost went for it, but my wife said I'd been waiting too long for this truck.  This isn't even the craziest part of this story.

After leaving the dealership we drove both trucks home to where a nice gentleman was waiting in my drive way with a cashiers check for $40,000 to buy my old truck.  It's crazy because I paid $46,000 for this truck 6 years ago.  I pretty much drove it for free.  All I ever did was put gas in it and change the oil.  Once I get the first statement in the mail from my new truck loan I'll be paying it off in full!!!  It feels like I won the car game!!!

[Syonyk]

What on earth are you selling in 6 years that's worth $40k, and why were you selling it if it's still basically a new truck? o.O

It's certainly not a bad deal if you can be on the wining side of it.  And I appreciate the people who buy new trucks so I can get them used long down the line, but, damn.  That's $100k of trucks.

[nereo]

That’s a crazy story, but yeah, the car market is bonkers right now.

I went to see a few dealerships just to get some eyes on a couple of cars (see if they worked for us or not) and was given the stink-eye for not having made an appointment.
 
Then I discovered that the 3 year old used cars - even private sale - were trading for MORE than their equivalent new cars after rebates.  That’s not “we’ll get you a lower monthly payment” but the actual sale price was basically identical to a few hundred bucks cheaper.

Called to test-drive a Leaf, confirmed an appointment and showed up for a test drive 30 minutes later.  Someone bought the car while we were on the 20 minute test drive. I made some remark to the youngish sales guy about this being some sales tactic and he was like “dude, I don’t have any car to sell you - there’s no sale to be made. Now you’re just going to go look someplace else cause there aren’t any cars to sell”

In time I expect it’ll come back to normal, but it’s a lot like lumber a year ago or glass jars for manufacturing.

[clarkfan1979]

I don't know much about trucks. Your new truck purchase seems like a win and a very interesting story. However, the story regarding your used truck that you are selling doesn't seem to be bonkers. 

It's pretty normal right now to sell used vehicles for more than what you paid for them. I bought two used vehicles in January & February 2020 that are currently worth a few thousand dollars more than what I paid for them. One of my friends bought a truck in April 2020 for 25K. He claims he can sell it today for 40K. Even if he is exaggerating a little bit, he could probably easily sell it for 35K. 

[comicguy]

In Nov 2019 I bought a new 2020 corolla hybrid for $20,200. I was at the dealership helping my mother in law look for a new car this week and I was offered while at the dealer 22,200 for my current 2020 corolla hybrid. I have driven it for 2 years and they want to give me 2000 more than I paid for it, of course they don't have anything to sell to me that would be comparable but it was nice to get the offer (even though I would not have taken it) but it just shows how crazy things are at this time!

[cool7hand]

Thanks for sharing!

[sixwings]

A friend of mine was looking for a rav 4, the sales guy at the toyota dealership said there's no inventory and the rav 4 has a 3 year backlog.

Sucks to be a cars salesman making commission in a situation like that.

[jrhampt]

I saw a used prius prime for sale back in 2020 for $14k, the same one would cost me maybe $10k more now.  Makes more sense to buy new right now, but I don't really need a replacement yet so I'm holding off.  I do have some regrets about not getting it in 2020, but oh well.

[nereo]

Sucks to be a cars salesman making commission in a situation like that.

I've heard that refrain, but I'm having a hard time being sympathetic. In my area there are stories of cars being sold over the phone before they even get offloaded from the car-carrier. MSRP is the floor for many models for the first time in my memory. When you can sell every car that comes in within a couple days (new or trade-ins) that's pretty ideal. 

[Glenstache]

A friend of mine was looking for a rav 4, the sales guy at the toyota dealership said there's no inventory and the rav 4 has a 3 year backlog.

Sucks to be a cars salesman making commission in a situation like that.

I bought a Rav4 hybrid in Seattle a few months ago. Lead time was about 2 months. For very little out of pocket (I traded my used subaru for thousands more than I paid for it) I drove away with a nicer vehicle that gets almost 30% better mpg. I redid the math probably a dozen times to reconfirm that it made sense, but the market is crazy, and very strongly favors those who can use time as leverage.

[Monkey Uncle]

Before the face punches please hear me out... 6 months ago I ordered a new pickup truck through a trusted dealer.  This dealership will sell any ordered unit at invoice pricing with zero-mark ups and no add ons. My truck finally arrived last week, and I went to get it.  I was shocked to find out that on top of invoice pricing and my unit being price protected even though MSRP has risen $3600 since I ordered it the dealership found that I qualified for $5000 in rebates.  They themselves where shocked and said they double checked it 3 times just to make sure because it had been over 2 years since they have seen anyone qualify for that much in rebates. I was buying a truck that had a sticker price of $65,000 for $53,xxx.  After TTL and the $150 doc fee I walked out paying $57260.  Here is where things get crazy.  After I finish up in the finance office the sales manger comes in and ask if I'd like to make an easy $5000.  I give him a look and he explains that if I allow the dealership to pay my truck off that I just bought and walk away he'd cut me a check for $5000 right now.  He said he would then list the truck as a used unit with 5 miles on it and sell it for MSRP in less than a day.  I was kind of shocked and almost went for it, but my wife said I'd been waiting too long for this truck.  This isn't even the craziest part of this story.

After leaving the dealership we drove both trucks home to where a nice gentleman was waiting in my drive way with a cashiers check for $40,000 to buy my old truck.  It's crazy because I paid $46,000 for this truck 6 years ago.  I pretty much drove it for free.  All I ever did was put gas in it and change the oil.  Once I get the first statement in the mail from my new truck loan I'll be paying it off in full!!!  It feels like I won the car game!!!

The take-away that I get from that story is that you just spent 17 grand that you didn't need to spend.

[Duke03]

What on earth are you selling in 6 years that's worth $40k, and why were you selling it if it's still basically a new truck? o.O

It's certainly not a bad deal if you can be on the wining side of it.  And I appreciate the people who buy new trucks so I can get them used long down the line, but, damn.  That's $100k of trucks.

Ford top of the line Platinum, Limited, and King Ranches hold their values extremely well. 

[Syonyk]

Ford top of the line Platinum, Limited, and King Ranches hold their values extremely well.

Sure, but I can't imagine why you'd sell one of them if it's only 6 years old, either.

My truck's 25 and doing fine...

[Just Joe]

2015 BMW i3 with range extender, 38K miles and $20K.

2015 Nissan Leaf, 49K miles, $15K.

Both purchased recently by my employer.

[happychineseboy]

this reminds me of bicycles at the start of the pandemic

I walked into Trek store and everything was sold out except for e-bikes and beach cruisers. The next 10 shipments were also already reserved and paid for.

2 years later and things are starting to return to normal

[Silrossi46]

My super clean 97 F350 regular cab that I paid 4000 for ten years ago suits me fine for the trips to Home Depot I use it for and to haul around stuff when needed.  Funny thing is with only 70k miles on it it’s worth quadruple that number now.  It is however super clean garage kept and not rusty. 

I would agree the market is bonkers. 

[nereo]

this reminds me of bicycles at the start of the pandemic

Yeah… I had a thread about how hard it was to find a decent bike. There were BSOs and some $3,000+ High end bicycles, but in the “middle” I couldn’t find a bike in my size to save my life.

[Syonyk]

My super clean 97 F350 regular cab that I paid 4000 for ten years ago suits me fine for the trips to Home Depot I use it for and to haul around stuff when needed.  Funny thing is with only 70k miles on it it’s worth quadruple that number now.  It is however super clean garage kept and not rusty.

Daaaaang.

7.3 or gasser?

[Silrossi46]

Gasser 5.8 L.  If it was a 7.3 even more !

[Jon Bon]

Just sold a 2009 Accord with 80k miles for 10k. it was in good shape. but a 13 year old car! I had a bunch of calls and probably could have sold it for even more! We bought it for 16k 8 years ago.

We also were able to purchase a new 3 row SUV to replace said sedan. We were able to pay MSRP on it. So 39k plus about 3k in taxes fees etc. I just typed it into KBB just for fun... I could probably sell for 48k! What the hell!


It is truly a mad world out there. Maybe I should see if I can flip some of the cars that my neighbor is hoarding.... Mainly so I don't have to look at them anymore.

[Fomerly known as something]

Just sold a 2009 Accord with 80k miles for 10k. it was in good shape. but a 13 year old car! I had a bunch of calls and probably could have sold it for even more! We bought it for 16k 8 years ago.

We also were able to purchase a new 3 row SUV to replace said sedan. We were able to pay MSRP on it. So 39k plus about 3k in taxes fees etc. I just typed it into KBB just for fun... I could probably sell for 48k! What the hell!


It is truly a mad world out there. Maybe I should see if I can flip some of the cars that my neighbor is hoarding.... Mainly so I don't have to look at them anymore.

Hmm, i there is a side hustle.  Order a new car, in order to immediately sell it for more.

[darknight]

Gasser 5.8 L.  If it was a 7.3 even more !

True. I've had both 5.8 and 7.3 PS.. I'd have a hard time choosing between them. 7.3 was cool/fun, but something always breaking or about to break. Glowplugs, harnesses, etc etc.. You've got it right with the 5.8.
I'm in a 12 valve now.. Thinking about selling as a 5spd non rust belt 4x4 ex cab with sub200k on it is nearly worth it's weight in gold.

[Fru-Gal]

This made me look up the KBB resale value of my 25-year-old car, bought used a few years ago for $2k. Supposedly could get $3k-$9k for it. Mentioned it to my husband and while he would be OK being car-free (all 4 of us bike everywhere), I guess we're not ready for that.

[bmjohnson35]

I know there is a shortage of new cars due to chip shortages and other supply issues, but local dealerships are not empty of stock.  These prices just feel out of control!  This craziness feels like a pre-curser to the bursting of a bubble.  As the fed continues to try to reverse inflation and global supply chain disruptions continue, the risk of recession increases.  It will be interesting to see how this all plays out. 

[nereo]

I know there is a shortage of new cars due to chip shortages and other supply issues, but local dealerships are not empty of stock.  These prices just feel out of control!  This craziness feels like a pre-curser to the bursting of a bubble.  As the fed continues to try to reverse inflation and global supply chain disruptions continue, the risk of recession increases.  It will be interesting to see how this all plays out.

I think it depends on how you define “empty of stock”.  There are several different make/models we have been considering and wanted to test-drive, but we’ve been unable to find a single one at any dealership within 50 miles. Zero. Nada. Of course they still have **some** cars they could sell, but there’s lots of holes in their inventory and the time vehicles sit on the lot is a fraction of what’s typical. For a whole bunch of models there are waiting lists a few months long.  Hence why people are paying a lot more for used - they need or want a specific car now and can’t get it new.

I don’t think the car market is a bubble that will ‘pop’ (as in: prices will suddenly collapse). The driving (mild pun) factor is that there’s been a supply constraint, and now there’s a backlog of demand, and supply continues to be constrained. Once production starts to chip away at the inventory problem prices will start trending downward IMO, but it’ll be a gradual decline back to where we were pre-pandemic. We’ll see, i suppose.

[Monkey Uncle]

I know there is a shortage of new cars due to chip shortages and other supply issues, but local dealerships are not empty of stock.  These prices just feel out of control!  This craziness feels like a pre-curser to the bursting of a bubble.  As the fed continues to try to reverse inflation and global supply chain disruptions continue, the risk of recession increases.  It will be interesting to see how this all plays out.

I think it depends on how you define “empty of stock”.  There are several different make/models we have been considering and wanted to test-drive, but we’ve been unable to find a single one at any dealership within 50 miles. Zero. Nada. Of course they still have **some** cars they could sell, but there’s lots of holes in their inventory and the time vehicles sit on the lot is a fraction of what’s typical. For a whole bunch of models there are waiting lists a few months long.  Hence why people are paying a lot more for used - they need or want a specific car now and can’t get it new.

I don’t think the car market is a bubble that will ‘pop’ (as in: prices will suddenly collapse). The driving (mild pun) factor is that there’s been a supply constraint, and now there’s a backlog of demand, and supply continues to be constrained. Once production starts to chip away at the inventory problem prices will start trending downward IMO, but it’ll be a gradual decline back to where we were pre-pandemic. We’ll see, i suppose.

My crystal ball is no better than anyone else's, but I suspect we won't see anywhere near pre-pandemic prices until we have a recession that causes the bottom to fall out of demand.  Easing of the supply crunch might cause prices to level off or drift downward a little, but I don't see dealers and manufacturers lowering prices significantly as long as people are still buying.

[js82]

I know there is a shortage of new cars due to chip shortages and other supply issues, but local dealerships are not empty of stock.  These prices just feel out of control!  This craziness feels like a pre-curser to the bursting of a bubble.  As the fed continues to try to reverse inflation and global supply chain disruptions continue, the risk of recession increases.  It will be interesting to see how this all plays out.

The used car market is 100% a bubble.  There are people out there (like the dealer in the OP's story) who are buying new cars and flipping them for a profit, and even cars that are 1-3 years old are sometimes going for above MSRP of a new model.

There is zero rational reason to buy a lightly-used car in this market.  You're literally paying new car prices for something with more wear and less warranty coverage.  The only reason this is happening is lack of patience with buyers for certain cars that tend to have waiting lists(Teslas, Ford Broncos, etc.).

This ends one of two ways: New car prices come up and used car prices stay relatively flat, or used car prices go off a cliff.  No one should be buying lightly used in this market.

[NotBadForADad]

I know there is a shortage of new cars due to chip shortages and other supply issues, but local dealerships are not empty of stock.  These prices just feel out of control!  This craziness feels like a pre-curser to the bursting of a bubble.  As the fed continues to try to reverse inflation and global supply chain disruptions continue, the risk of recession increases.  It will be interesting to see how this all plays out.

The used car market is 100% a bubble.  There are people out there (like the dealer in the OP's story) who are buying new cars and flipping them for a profit, and even cars that are 1-3 years old are sometimes going for above MSRP of a new model.

There is zero rational reason to buy a lightly-used car in this market.  You're literally paying new car prices for something with more wear and less warranty coverage.  The only reason this is happening is lack of patience with buyers for certain cars that tend to have waiting lists(Teslas, Ford Broncos, etc.).

This ends one of two ways: New car prices come up and used car prices stay relatively flat, or used car prices go off a cliff.  No one should be buying lightly used in this market.

I'm pretty enticed to see what I could get for both my vehicles.

2014 VW Jettawagen & 2014 Audi Q7. Both Diesel.

The VW is paid off and I owe like $8k on the Audi.

Probably not worth it to see if me and the mrs. could get something new.

[bmjohnson35]

I know there is a shortage of new cars due to chip shortages and other supply issues, but local dealerships are not empty of stock.  These prices just feel out of control!  This craziness feels like a pre-curser to the bursting of a bubble.  As the fed continues to try to reverse inflation and global supply chain disruptions continue, the risk of recession increases.  It will be interesting to see how this all plays out.

The used car market is 100% a bubble.  There are people out there (like the dealer in the OP's story) who are buying new cars and flipping them for a profit, and even cars that are 1-3 years old are sometimes going for above MSRP of a new model.

There is zero rational reason to buy a lightly-used car in this market.  You're literally paying new car prices for something with more wear and less warranty coverage.  The only reason this is happening is lack of patience with buyers for certain cars that tend to have waiting lists(Teslas, Ford Broncos, etc.).

This ends one of two ways: New car prices come up and used car prices stay relatively flat, or used car prices go off a cliff.  No one should be buying lightly used in this market.

I suspect that inflation's staying power and whether or not we enter a strong recession will be the major determining factors.  Either way, I choose not to participate as a buyer in this market. In the mean time, I just listed my garage queen roadster that I rarely drive anymore.