My patience just ran out.

[Kbl911]

Car market is about to crash, hard.

Prices are going to be much lower, very soon....3-6 mos soon

I've seen some predictions to this effect, as well.

Interest rates have definitely not hit their ceiling yet and most projections have the peak coinciding with the beginning of at least a mild recession. Ironically, many also predict that next spring/summer is when supply chain issues will start to abate, which will cause a flood of vehicles to hit dealerships...just in time for nobody to be buying.

 

[West Aussie]

Car market is about to crash, hard.

Prices are going to be much lower, very soon....3-6 mos soon

Given the extended wait in Aus …I was looking at a 2019 BMW Z4….price dropped by 10k in the last week, and still there (now 80k)
I’m sure it will drop again in another few weeks. Especially as a new Z4 with full warranty is 100k

 

[Houston.RZ34]

I've seen some predictions to this effect, as well.

Interest rates have definitely not hit their ceiling yet and most projections have the peak coinciding with the beginning of at least a mild recession. Ironically, many also predict that next spring/summer is when supply chain issues will start to abate, which will cause a flood of vehicles to hit dealerships...just in time for nobody to be buying.

My guess is, Auction houses are trying to keep things contained until Tax Time - the floodgates are going to open after that.

The lots are absolutely full, they are at the point where they're leasing nearby land now

 

[Houston.RZ34]

Given the extended wait in Aus …I was looking at a 2019 BMW Z4….price dropped by 10k in the last week, and still there (now 80k)
I’m sure it will drop again in another few weeks. Especially as a new Z4 with full warranty is 100k

2019 was the last of the hardtop ones right or, was it the start of the current soft top?

 

[West Aussie]

2019 was the last of the hardtop ones right or, was it the start of the current soft top?

Soft top…that, and the fact it’s Auto is the reason why I haven’t jumped yet

 

[Kbl911]

My guess is, Auction houses are trying to keep things contained until Tax Time - the floodgates are going to open after that.

The lots are absolutely full, they are at the point where they're leasing nearby land now

Yes, this is the other big factor!

The combination of new cars flowing more freely into dealerships *and* the auction houses flooding the market with a huge inventory of pre-owned vehicles will potentially drive prices down enormously. It's been unprecedented to see bidding wars for used vehicles in every market segment (usually only occurs with rare/highly-specific vehicles, not Toyota 4 Runners).

My big question is this: how will the dealerships try to offset this phenomenon in an effort to both juice sales and maintain the ludicrous profiteering they've had for the last few years? In the past, dealer incentives - in the form of discounts or financing deals - were typically there to entice people into lots when general interest rates were on the high end and demand was low, but I don't see dealerships returning to the discount model since it directly caps their potential profit on new inventory. They've gotten so used to record profits, it'll probably take time for them to let that go.

Seems nearly impossible to have it both ways, here.

 

[Houston.RZ34]

They're not going to have much of a choice, the days of gouging are coming to an end - soon.

My personal prediction......

Cars are going to plummet in value because of all the inventory, record Repo numbers.

Think about it, there's a LOT of 2017 - 2019 inventory out there from folks that were robbed 2020-2022.

That 2017 inventory is about to cross the magical 5 year mark. At 5 years value goes way way down because it's harder to secure a loan for anything older than 5 years.

A lot of the 17-19 cars were bought WAY overvalue during the pandemic those cars are going to become worthless now in the eyes of the market.

Add on top of that new cars are about to start catching discounts again to get people in the door.

Basically how everything has skewed in a dealer's favor over the past 3 years is about to take a complete and total 180 and it's going to be a buyer's market for at least a year or two.

By the time all that extra inventory gets snapped up supply chain issues will fully normalize again because there's about to be a hell of a lot less demand for new when you've got all these deals used.

 

[indio22]

They're not going to have much of a choice, the days of gouging are coming to an end - soon.

My personal prediction......

Cars are going to plummet in value because of all the inventory, record Repo numbers.

Think about it, there's a LOT of 2017 - 2019 inventory out there from folks that were robbed 2020-2022.

That 2017 inventory is about to cross the magical 5 year mark. At 5 years value goes way way down because it's harder to secure a loan for anything older than 5 years.

A lot of the 17-19 cars were bought WAY overvalue during the pandemic those cars are going to become worthless now in the eyes of the market.

Add on top of that new cars are about to start catching discounts again to get people in the door.

Basically how everything has skewed in a dealer's favor over the past 3 years is about to take a complete and total 180 and it's going to be a buyer's market for at least a year or two.

By the time all that extra inventory gets snapped up supply chain issues will fully normalize again because there's about to be a hell of a lot less demand for new when you've got all these deals used.

When I was younger, it wasn't uncommon for people to buy base model and economy cars. Then something happened, and I feel like big spending on higher trims/models and loaded vehicles became more of a cultural "thing".

It's no exaggeration to say, I probably have the lowest cost new vehicle in my entire middle class neighborhood. My neighbors are driving around in vehicles that cost at least three times as much. And not because they are rolling in cash, but because it's like an expected norm to spend bigger these days on vehicles.

For that reason, even if we see constraints lessen and production increase, this big spending habit I think is going to still drive higher prices to some extent. Some of these people could be living on peanut butter sandwiches, and they'd still be blowing 50k on a new car!

 

[Donalex]

Yep, in normal times of rates and terms, each $1,000 is about $7 monthly. Extend terms and you can finance another $10k for about $35 a month.

 

[NecioVato]

I think the beginning of next year or maybe even the end of this year will be interesting. I am actually seeing where the Honda CTR (the car I am currently looking for) is dropping in price - its still WAY overvalued but still - it is giving me hope that once things start to normalize and add in the higher interest rates - that prices will return to normal.

As for Worse Time to Buy - if interest rates continue to go up to battle inflation; then even if prices go down (bc I don’t think they will plummet for enthusiast cars - believe it will be a slow fall over 6mo). I keep hearing that this might be the best time to buy bc of the following:
1. Interest rates are going up and will continue to go up
2. Trade in Values are tanking as well and will continue bc the market is stabalizing
3. Probably the first time in years - that dealers are willing to negotiate bc of the car bubble coming to an end.

Regardless - everything right now is speculation but it will make things fun to read about etc on forums as we see things unfold.

 

[Z06fan]

Yes, this is the other big factor!

The combination of new cars flowing more freely into dealerships *and* the auction houses flooding the market with a huge inventory of pre-owned vehicles will potentially drive prices down enormously. It's been unprecedented to see bidding wars for used vehicles in every market segment (usually only occurs with rare/highly-specific vehicles, not Toyota 4 Runners).

My big question is this: how will the dealerships try to offset this phenomenon in an effort to both juice sales and maintain the ludicrous profiteering they've had for the last few years? In the past, dealer incentives - in the form of discounts or financing deals - were typically there to entice people into lots when general interest rates were on the high end and demand was low, but I don't see dealerships returning to the discount model since it directly caps their potential profit on new inventory. They've gotten so used to record profits, it'll probably take time for them to let that go.

Seems nearly impossible to have it both ways, here.

And an angry public that they've created even more so after the past two years. The public disdains dealers even worse than in the past. I'm looking forward to my next purchase and bleeding them for every dime that I can.

 

[Donalex]

So, you save some money in buying the car, and you can pay it off at lower than prevailing rates by paying approximately 10-12% more than your actual loan payment each month.

That extra money goes toward principal and, because interest paid each month is based on a declining balance, you'll pay less interest overall.

 

[Houston.RZ34]

Soft top…that, and the fact it’s Auto is the reason why I haven’t jumped yet

That's funny, the hardtop made it until 2019 in the US, Softtop was a 2020 here

 

[Kbl911]

And an angry public that they've created even more so after the past two years. The public disdains dealers even worse than in the past. I'm looking forward to my next purchase and bleeding them for every dime that I can.

Oh, absolutely. Dealerships have gone scorched earth on what little reputation they collectively had left with the car buying public. The nakedness, the sheer audacity, of the customer-fleecing has been staggering to see.

When I do decide to replace my current Z, I also intend to hammer the dealership on the price. It'll be cathartic.

 

[Z06fan]

When I was younger, it wasn't uncommon for people to buy base model and economy cars. Then something happened, and I feel like big spending on higher trims/models and loaded vehicles became more of a cultural "thing".

It's no exaggeration to say, I probably have the lowest cost new vehicle in my entire middle class neighborhood. My neighbors are driving around in vehicles that cost at least three times as much. And not because they are rolling in cash, but because it's like an expected norm to spend bigger these days on vehicles.

For that reason, even if we see constraints lessen and production increase, this big spending habit I think is going to still drive higher prices to some extent. Some of these people could be living on peanut butter sandwiches, and they'd still be blowing 50k on a new car!

Yeah, I observe and think about that same thing. So many people seem to have bought into the societal marketing hype and are more worried about how things look to their neighbors, than what they can actually afford. In high school and college I drove beat-up junkers and that was the norm for kids. Now, even kids are worried about driving an infinity, lexus, BMW, etc. When I took my oldest daughter down to Miami for college, the student lots were full of BMW 3's and Mercedes. My wife and I grew-up in blue collar areas and thankfully for some reason, never got caught up in that. A lot of people are so far in debt that they're going to have their world rocked if/when the economy goes into the shi*ter.