Auto Dealers Gird for Softening Demand Amid Higher Rates, Uncertain Outlook

[RickMachE]

A survey of 1,000 dealers shows their outlook on the market is the lowest it has been in five years

https://www.wsj.com/articles/auto-d...9ji61olncdo&reflink=desktopwebshare_permalink

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[SnBGC]

I think we are starting to see it already. Dealer lots are overflowing now (at least here in Phoenix....)
I could have bought an EV pickup this week (looked at several Lightnings and R1Ts) but something held me back and I decided to wait and be happy with my simple MME for a while longer. Purchase prices that are 50% higher than what I paid for the MME plus the current interest rates are the primary things holding me back. Perhaps I am not alone....

 

[RickMachE]

Just one quick picture in time.

My dealer has 499 new vehicles. Sounds like a lot. Using the wayback machine, in 2018 he had 1,732... So I wouldn't call his lot overflowing.

Of note, his current "inventory" includes 113 In Transit, 93 Dealer Ordered, 7 Courtesy Vehicles, and 9 In-Service FCTP. That means he only has 277 to sell.

 

[AKgrampy]

Not in the market for a new car at this time but our local Ford dealer’s lot remains fairly bare. I do not think they opted in for the EV program so it will be interesting to see how things go for the next couple of years. My thoughts were to get a new Ford EV in about 2 years but may have to move on to another brand. Fortunately I am in a good position vehicle-wise to ride things out and see how things develop in the vehicle market over the next couple of years.

 

[Arsenic17]

Interest rate impacts on car affordability should be fairly minimal. It's nothing like a mortgage which can bloat payments with interest changes of several percent.

For example, purchasing a Mach-E at $60k with $5k down for 5 year loan only changes your monthly payment by ~10% when going from 1% to 5% rate. For an example I looked at, it goes from $1050 to $1150.

 

[tannerk89]

Interest rate impacts on car affordability should be fairly minimal. It's nothing like a mortgage which can bloat payments with interest changes of several percent.

For example, purchasing a Mach-E at $60k with $5k down for 5 year loan only changes your monthly payment by ~10% when going from 1% to 5% rate. For an example I looked at, it goes from $1050 to $1150.

Paying an extra $7000 over 5 years on a $60,000 car is not a small amount! I can think of a lot better ways to spend $7k than dumping it out the window…

 

[JCHLi]

Just sold a vehicle, down to just the Mach-E and a motorcycle for the household. Maybe I timed it right if demand is about to go down.

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