Projections: Used Automotive Market

[jabroni619]

However, the crash WILL happen because everything was bought at MASSIVELY inflated prices. Houses, and cars in particular will turn people upside down. When this crash hits, the interest rates will be much higher than now, and people won't be able to afford. In the background, inflation will chew up ANY expendable income that households have. Welcome to Democrat / Socialist economics.

Values might drop but it’s not going to crash like it did before. Values will alao stay consistent until the fed raises interest rates, then they’ll drop a bit. It still won’t crash because everyone’s payments will remain the same So you are t going to have a massive number of people who suddenly cannot afford their home like in 2008

 

[WillieFlo]

Yep - the report is correct that the vehicle market in general will return back to normal. Some call that the "market tanking", and I do agree with that. The DJIA is going to nosedive, gas will skyrocket, inflation skyrocket, and interest rates skyrocket. This is Bideneconomics working for us. In any cases, 2021, 2022, and 2023 will be terrible years to buy vehicles... whether it be bubble pricing (WAYYY overinflated price versus actual value), COVID parts (shortages have forced every manufacturer to use any part from any supplier), or COVID builds (untrained, gypsy workforce that doesn't care about build quality)....... also, not to mention the Ford service techs that are inexperienced to work on these complex service/warranty jobs. I would not touch a vehicle until 2025 at this rate... and it probably won't be a ford since they drank the biden juice and are caving to the liberal tree huggers. I would not doubt that Ford and Subaru join forces

How are they stealing Gen 2s? From what I have seen the Cartels have a pension for the Gen 1 Raptors with actual keys. I am not sure I share @WillieFlo outlook on things. I think it is too big to fail and the prices for new vehicles and houses will continue to be high. I am not sure if the powers that be will allow another 2008 to happen. There is too much printable money to let that happen and too many people dependent on the government as well.

We don’t know how they’re getting stolen, but the bandits know what to remove so you can’t track it with Ford app…… lose location in less than 30 minutes…..they know they’re way around the systems. Keys/fobs don’t mean sh*t to the young techno thieves out there these days. Raptors bring top dollar everywhere outside the US.

 

[WillieFlo]

So, why do you say it's a 250k house? The market always dictates value. When hyperinflation hits, that 250/400 house will cost 1m-? to replace, in short order. Buyer is locked in at $1.5k/month payment, without regard to taxes and insurance. The people renting are really gonna take the hit because they missed the boat. Same with the non-raptor owners. Of course, we may all be driving gov't hourly rental electric cars in a few years.

The dollar is going into the *****-er eventually, it has to the way they are printing it.

If there is some type of crazy crash, we're all in the same boat. Then...

Yep, that’s a possible outcome of some major corrections don’t take place. You can’t just print your way out of a f’d up economy.

 

[jamanrr]

Yep, that’s a possible outcome of some major corrections don’t take place. You can’t just print your way out of a f’d up economy.

Need to raise interest rates to control inflation. Something none of the politicians want to do.

 

[GordoJay]

Greetings All,

Informative and detailed perspective from KPMG regarding the used auto market—and when “normal” may return.

https://advisory.kpmg.us/content/dam/advisory/en/pdfs/2021/car-crash-design-secured.pdf

Of course this is the perspective of one analyst; however, given the interest by some regarding trade values—hopefully this is useful.

Wishing all a healthy 2022!

Good article, thanks. For the TL;DR crowd ... they have no f***ing idea what's going to happen. Anything from a soft landing to a crater in the ground is possible depending on what else happens in the economy.

 

[sixshooter_45]

All I know is we're all gonna die.

LOL!

 

[IDontDoUrban]

How are they stealing Gen 2s? From what I have seen the Cartels have a pension for the Gen 1 Raptors with actual keys. I am not sure I share @WillieFlo outlook on things. I think it is too big to fail and the prices for new vehicles and houses will continue to be high. I am not sure if the powers that be will allow another 2008 to happen. There is too much printable money to let that happen and too many people dependent on the government as well.

I can attest to @WillieFlo ’s statement. I’m part of the same HARO group and have seen the theft stories. Two in nearly a week.

 

[jamanrr]

I can attest to @WillieFlo ’s statement. I’m part of the same HARO group and have seen the theft stories. Two in nearly a week.

They would have to be fast then, I check my Ford Pass app periodically. If I saw that then there would be a hunt for my truck via GPS and they better hope that they could pull it before I found them or the truck.

One solution would be to put an air tag somewhere on the vehicle hidden. Hunt them down, find your ride, and hope you don't have to OK Corral yourself in.

LOL

 

[Faster48]

The $250k house that was just bought at $400k. That’s what is going to kill the market. The people paying msrp or even adm on vehicles will never recoup that. These are driving the imminent crash. Stupid people spending money in stupid ways.

this is an oversimplified view taken without any consideration for the exceptionally low interest rates that are also FIXED, as well as the fact that there was a massive stimulous on top of those low rates bringing a ton of buyers in. What happens when demand outpaces supply?
The home prices this time (with some exceptions) are not a bubble. This market is completley different than the 2008 market where un-qualified and speculative buyers drove prices. Then as already mentioned, you had predatory loans as the normal and folks were instantly upside down.

 

[jamanrr]

this is an oversimplified view taken without any consideration for the exceptionally low interest rates that are also FIXED, as well as the fact that there was a massive stimulous on top of those low rates bringing a ton of buyers in. What happens when demand outpaces supply?
The home prices this time (with some exceptions) are not a bubble. This market is completley different than the 2008 market where un-qualified and speculative buyers drove prices. Then as already mentioned, you had predatory loans as the normal and folks were instantly upside down.

When demand out paces supply you have bidding wars and hyperinflation to the normal consumer. It is roughly 20 percent more money to build a comparable house today than it was 2-3 years ago. Using the 250k example, (+20%) means that house now costs 300k and guess what you could sell it for more than that. I am glad that they changed the housing laws as it makes it more difficult to hide funny money. I bet we all know people who work the system and run cash businesses milking every government assistance program out there is and living in a 500k house. Funny thing is NOW they have to prove the money and can't get away with it. If they show up with 70-100k cash at closing they have to disclose where/ how they received that and NOW if they did not report it as income. The IRS man comes a knocking, this protects the market and eliminates as you called it predatory lending.