15 Signs A Massive Car Market Crash Is Already Upon Us
15 Signs A Massive Car Market Crash Is Already Upon Us
A devastating car market crash is now in motion, and it will trigger brutal consequences for buyers, sellers, and dealers. The U.S. auto market entered 2023 in a massive bubble, with average new car prices hitting an absolute record high while used car prices were almost 42% higher compared to 2019 levels. But now several factors are contributing to a collapse in the value of cars. At the same time, auto loan debt levels are shooting up and even borrowers with good credit scores are becoming unable to afford car payments and having their vehicles repossessed. A famous industry executive said this could lead the country to the next great financial crisis, and considering the pace at which this downturn is unfolding, it looks like his warning is spot on.
In February 2023, the average cost of a new car climbed to $50,000 in the United States, up from just $38,948 in December 2019. That marked the highest price for a new car in history, according to data compiled by Edmunds. At the same time, a growing number of consumers are having to stretch their budgets to afford a new vehicle. The average monthly payment for a new car is up 26% since 2019 to $718 a month, and nearly one in six new car buyers is spending more than $1,000 a month on vehicles, also a record. Other costs associated with owning a car have also shot up, including insurance, gas, and repairs. “With new car prices as high as they are, it’s getting more and more difficult for most Americans to stomach these payments,” stresses Ivan Drury, Edmunds director of insights.
After the pandemic broke out, automakers expected car demand to collapse, which led them to reduce output, and microchip manufacturers followed suit. With a shortage of new cars hitting the market in 2020, consumers started to use their stimulus checks and took advantage of low-interest rates to purchase used cars instead, driving up prices four times faster than the growth seen in the inventory of new cars. “The perfect storm of supply and demand created a temporary and unsustainable spike in used car prices, says Motley Fool’s analyst Sean Williams. A huge bubble was formed, but a reckoning has just arrived.
The repercussions of the car market collapse can throw the entire country in disarray. We must consider that the U.S. car industry is a significant contributor to the country’s economy, accounting for millions of jobs and billions of dollars in revenue. A crash in this market can result in a significant economic downturn, leading to widespread job losses, bankruptcies, and a sharp decline in consumer spending. It can also disrupt the supply chain for many other industries. Given that car manufacturers rely on a vast network of suppliers to produce their vehicles, when the crash finally occurs, it will trigger a domino effect on these suppliers, leading to mass disruption in many sectors. When Musk says this could turn into a financial nightmare, he isn’t bluffing. We should all pay very close attention to the next developments of this crisis because it will ultimately impact all of us. That’s why in today’s video, we compiled several facts that prove that the U.S. auto market is in huge trouble.
I purchase a car about every 10 years. I take it very easy on my cars and change oil every 3K miles. If you put $10/day aside in the meantime, you’ll be surprised what you can afford.
I am saving money for a repo deal waiting for the crash
Just imagine a 1,000 dollar a month car payment and the next year it is a used car and the second and third year it is only worth half the value and the fourth and fifth year it is a old car and people will really have to take care of the car to get the value to stay up because they are paying for 6 or 7 years on a old car
Paid cash for 2016 Prius, also for a 2021 Ford Ranger, Paid off my RV in 3 years, and house is paid for. Don’t plan on buying another new car, truck, RV, or house so I am good. I HATE paying interest on anything.
It’s amazing to me that cars with all that technology aboard can’t seem to keep all the lights working.
a penzed rohad el 5 ev alatt 1 auto 5ev alatt egy rohadt auto ami nem megy att az ellenorizesen mvd
You would be nuts if you think that Chinese are not watching this, If they move on this, they can take over the U.S. Auto market
I dont see nothing good to come of this. Seems like the flood of repos will cause a flood of supply. If the cars arent selling prices will drop. Now another thing is people who bought with heavy mark ups will just leave their cars.
Really hope the crash is for the EV car market
People stupid enough to buy Teslas get exactly what they deserve
Sport manual cars will maintain their value after almost doubling in price for some models such as 2010 911 turbo. Not all cars are just cars.
I’ve became quite the mechanic….. keeping my 2007 Ford Focus running has been a little challenging but I don’t and won’t ever have a car payment again 😃
All that money from car sales of Japan an China automobiles is going to them😂😂😂
11:03💔 bait-and-switch 🥊💥🤡
Buy A used/new corolla and maintain it extremely well.
acording to your videos colapse already began 2 years ago 😀
ÕMĞ é PôWéŘ-PhÛľĽ Orrrsé-Strâylêans
😟😟😟😟😩😩😩😩😩😩😧😦😥😦😦😦😦😦😧😳😵😶😵😳😳😳😳
Whenwillhappenwhen
Good time to be in the repo business.
I think I will just change the oil and filter on my 04 mustang GT automatic dark shadow gray and keep riding with it fun to drive
Banks and loans companies have been financing a lot of foreign cars and I have seen a lot of them on tow trucks being repo
I work at an FCA dealership. A good reason why the cars prices on the lot are so high is because we aren’t getting a lot of stock of all the models. On a weekly basis we get Grand Cherokees, Durangos, Compasses, 1500s, and on occasion Wranglers. Maybe 1 Wagoneer a month if that. Very few Cherokees come in and I haven’t seen a Gladiator in a few months. Challengers and Chargers only come in on special order SRTs. Almost no Pacificas or Renegades since January. And only 1 2023 300 (with a 5.7L RWD) has come in in the last year. I have enough to buy in this market but I’m waiting till the collapse, then I’ll go from a Limited to a Summit.
The future of the automobile is dead. The electric car doesn’t even make sense. If all the electric car can do is get you back and forth to a job, you can put $40,000.00 in the bank and ride the bus for that. Automobiles are facing extinction.
what goes up must go down; so glad to have a paid off van in good condition
Cool, I want to buy a weekend car for cheap…..
Bought both my cars cash haven’t had a car payment in over 10 yrs
They not also don’t forget cars are not reliable so repairs also hurt
Soon we go to buy horses, donkeys, camels, dogs, etc…., because they will be easier to find and buy.
can this hurry up these dealers and their 50 to 100k mark ups are insane
Since this video prices increased by 10%, good job
People have been buying up those Kia Kia , Hyundai,Honda Lexus and Nissan and over paying the inflated prices
Thank your Democrat Voter and Biden the Working Poor are now Poorer.
till I see it happen this is just spit in the air
Keep in mind we have an inflationary monetary system that benefits the rich bankers and corporate America. Another issue are all the asinine regulations that have increased since the Obummer administration. You the consumer are paying for all those extra air bags and emissions issues whether you want them or not. I’ve thought for a long time that the 1990s were the optimal in terms of computerization in terms of pollution control and other features on cars. If the car is wrecked but repairable, it cost extra money to not only replace the bumper for example, but all the sensors that entails and the labor required. We are all paying for too many safety and environmental regulations.
Ive never bought a brand new car because that has always seemed like an extremely stupid thing to do.
Remember. Joe Biden caused this… keep voting democrat…
There will be more
We are faced with fresh issues every day. It now serves as the norm. We initially mistook it for a crisis, but now we recognize it as a new normal to which we must adjust. What might be done to increase income during the quantitative adjustment as 2023 so far seems to be a year of great economic suffering across the country?I can’t allow my $680,000 in savings to disappear after all of my hard work.
Here hoping that the crash is steep…
I need a vehicle…
And they are just being stupid about the prices
Bought a car with 30k miles for only $11000 and I don’t have car payments. Do you self a favor, buy cash and boycott dealerships!
I was looking for a used 5-10 yo car at the Toyota Dealership today and the lot was over flowing with 2-3 yo Toyota SUV’s. How many are repo’s I wonder?
😂 false information being spread since last year
Most likely this is just clickbait.
Hit upside the head
Pass the buck, down to the customer🔥🥵🔥💸🤦🏽♂️
When the fed raises interest by 5% in the last 2yrs , its bound to effect , the loans , the credit cards & mortgages , it not rocket science & people knew all along, coupled with supply chain issues & the russian war , its a perfect storm .
It’s obvious that you want it to happen
Can anyone tell me why the automakers are not making cheap cars?
I am waiting for the 2024 mustang GT automatic dark shadow gray been saving the money for a big down payment so I will see what happens if the price is right I will not pay 10 or 15 grand for a down payment and still have a 1,000 a month car payment no way in hell
Bought my second car in 2020, car payments were $630/m. I was 20. It’s not impossible, but I like to think of it as an investment. Besides, what am I going to do–walk? I plan to finally pay it all off by June this year!
What’s up with odd, Australian, scary voice?
A car price crash means nothing if interest rates are too high to afford a loan.