Budget Car Buyers Want Automakers to K.I.S.S

https://www.thedrive.com/news/budget-car-buyers-want-automakers-to-k-i-s-s

by PaulHoule • 12 months ago

35 97 12 months ago

drweevil3• 12 months ago

My number one requirement is that any car that I buy is mine. No subscriptions. No calling back to the mothership. No spying on my activities or driving skills. I'd like to be able to repair it too, or at least be able to take it to the mechanic of my choice. This is a somewhat different desire than simply K.I.S.S.--and wasn't addressed in the article--though I wouldn't mind that either.

jacquesm2• 12 months ago

These are the exact reasons my car is now 28 years old. It's not like I can't afford a new one but I want a vehicle, not a piece of malware on wheels.

pryelluw• 12 months ago

What do you drive if you do t mind me asking? Fellow older car driver here. I have a 91 Mustang.

sleepyguy• 12 months ago

2006 Lexus IS350, 2007 Toyota Avalon, 2010 Toyota Venza. My in-laws have a 2000 4Runner that I still need to drive into the ground, but I'm not sure if I will be able to do it since it refuses to die (325k miles). All the vehicles are immaculate and have at least a decade or more left in them. I plan to drive them all, as long as they continue to sell gasoline.

jjav2• 12 months ago

not a piece of malware on wheels

Indeed. Aside from price, this is why I will never own a new car, or anything newer than roughly 2015 or so (depends on manufacturer). A car must absolutely not have any internet phone-home spyware connectivity.

0cf8612b2e1e• 12 months ago

Is that even possible on a modern vehicle? I thought all of the major brands were now selling your location data.

lenerdenator6• 12 months ago

I've heard you can yank a fuse/relay/antenna and avoid it but would like confirmation of that.

CodingJeebus• 12 months ago

Not really, all major auto manufacturers in the US AFAIK have trackers in their vehicles nowadays.

natch3• 12 months ago

People who would buy such data don’t care about getting it for every individual. They’re perfectly happy if they can get it for merely 99.999% of people, and that they can do with cellphone app data.

So they don’t need car data. My car maker does not sell its data nor does it link car locations with car owners. Although it could do so, but not without some bad PR or legal risks of doing it secretly after having made assurances that it doesn’t do it.

But that gets back to who would buy it? Nobody. They already have all the data they need from phones.

giantg22• 12 months ago

I generally agree. I have an 8 year old work trim truck that doesn't have much tech in it. Im dreading the day I'll need to replace it. Hopefully I'll get another decade or so out of it.

ourmandave• 12 months ago

Yeah, this. I drove my daughter's 09 Pontiac Vibe and trying to flip the mirror, accidentally hit OnStar and they answered, even though she never had a subscription.

After all the niceties and "no, I hadn't been in an accident", I was afraid to touch the mirror after that.

drweevil3• 12 months ago

BTW, if you want to get a hint at what shenanigans are going on with "your" vehicle, read the privacy policy. That they even have one is itself a sign of the times.

jrs235• 12 months ago

How do those privacy policies work with regards to secondary private vehicle sales/purchases?

lenerdenator6• 12 months ago

Simple cars don't make money... well, all of the available money.

The complex ones do.

You can get John Q. Public to buy a basic, efficient, safe compact car with cloth seats... or you can use that same production line to build a full-sized truck with tons of non-essential electronics that costs three times as much, which then requires the buyer to take out a loan from your financial arm for 84 months.

Which one returns more value to the shareholders?

EDIT: "non-essential electronics" should be seen as huge displays and the like, not things like emissions controls or safety equipment.

LightBug1• 12 months ago

Not if that means I don't buy them at all, because I don't !

Still rolling in 2005 Toyota. Fuck modern cars! Excuse my French.

csours4• 12 months ago

Disclosure: I work for General Motors, this is solely my own opinion and experience.

Which one returns more value to the shareholders?

I think the 'shareholder primacy' era of American capitalism has had some particularly dumb and bad effects... unfortunately I can't change that just by being angry and anxious about it. The market loves tech companies right now, which really distorts the valuation of other companies.

I think that people still vastly underestimate how difficult it is to make a physical product, how much time and attention it takes.

I saw a presentation for assembling the Chevy Cruze in Lordstown, Ohio. There was a planned market size, production volume, etc, etc. The closest it got to the estimates (if I recall correctly) was about 1/2 to 2/3 the planned production volume. After the first couple of years of production, volume dropped more.

At 1/2 volume, the plant would never make money. The fixed costs simply eat too far into revenue. The lower the volume, the longer it takes to pay off things like engineering costs - not just for the OEM (GM, Ford, etc), but also for the suppliers. Suppliers often book substantial losses for the first couple years of a new product.

Simple cars don't make money...

They really don't make money. On the very best day, a $30,000 simple car might make $1,000 net profit to the OEM, maybe another $500 to the dealer. On a median day, the initial sale might be a small loss.

Under capitalism, there is strong pressure to move upmarket. Under communism, most people never even got the simple car, and those who did get the simple car had to wait for many years.

lenerdenator6• 12 months ago

And yet, other companies are able to stay in business while making these vehicles, sometimes in countries with even more onerous business and labor environments than the United States.

analyst74• 12 months ago

Do they not want those conveniences? Or are they tempering their expectations based on their budget and perceived cost?

If, let's say, a typical $30k car means a large EV SUV with all the luxury gadgets and conveniences, plus fridge, massage chair, full camping setup, etc. Would 30k car buyers not expect those things?

loloquwowndueo4• 12 months ago

I can afford an suv. That’s not the issue - I just find it ridiculous to move that much metal for a small family or one person. A regular sedan would do.

cosmic_cheese• 12 months ago

A regular sedan would do.

Or a small hatchback, e.g. a Fit, Golf, Matrix, Yaris, etc. They might not be the most attractive looking vehicles but darn if they aren’t practical. Better cargo space than much longer sedans while being short enough to park almost anywhere.

It’s so disappointing that they’ve disappeared from the US market almost entirely.

xyzelement2• 12 months ago

I used to think that way (small car is best) until I had a family. yes in theory you can fit a small family in a sedan but in reality - not being able to fit a suitcase + stroller + kids bike (or whatever) into the trunk at the same time, or having your wife strain her back bending down to strap the toddler into their seat - gets old quickly!

So in practice what happens if that if you have a family and can easily afford an SUV, you get the SUV to alleviate these painpoints,

nradov2• 12 months ago

Well you're in luck! There are numerous regular sedans like a Nissan Sentra or Hyundai Sonata available at your local dealers. If you want one you can buy it and drive it home today.

Eric_WVGG• 12 months ago

When I was a teen I wanted to install electric windows in this vintage car I wound up with. My father said, “That‘s just one more thing that can break,” and yes it sounds kind of glib but I really took that to heart and let it shape my life in a direction of dependable simplicity.

I got out of car culture around 25 years ago, and every time I ride someplace in a modern car I'm just bewildered by all the bullshit. Do grown adults really need to be "pampered" with heated seats? How can you stand carrying around those "fobs" in your pockets — they make jeans look ridiculous, like a person is packing two sets of their junk.

I can't imagine buying a car built after 1990.

thegrim33• 12 months ago

For an article about keeping cars simple they don't mention some really big things.

They present it as a choice between manual or electric seats, manual or electric buttons, etc., which are indeed valid items of discussion ..

But what about other expensive, complicated, things I want a choice to get rid of, major things I don't want to pay for, like .. auto stop-start, or the ability for the car to slam on the brakes by itself, or the ability for the car to decide to steer itself if it thinks I've strayed from the middle of the lane. Heck, I don't want a rear camera or blind spot monitoring, I'll check my blind spots myself. They're even working on mandating some sort of monitoring in the next few years to "detect" whether you might be drunk.

What are the costs of all those sorts of things? All the sensors? All the computers? All the design/coding? The costs for maintaining all of it? The cost of the extra complexity? No mention of any of that?

(Also don't get me started on the extra cost and complexity and loss of maintainability that emissions regulations have added to cars. They used to be dead simple and maintainable.)

Ambroos• 12 months ago

Almost all of the other things you want to get rid of are legal requirements in some regions. Auto start-stop is generally to meet emissions targets. European safety regulations have made all of the following required on all new vehicles sold since mid 2024: AEB detecting cars/pedestrians/cyclists, intelligent speed assist, lane departure assist, reversing camera or sensors, drowsiness warning and a few others. For any car or platform that will at some point end up on the European market you can thus expect manufacturers to make all of these standard.

There's a cost attached to them, but it was decided that that cost is worth the significant benefits in road safety for both the people in the vehicle and the people around the vehicle.

unglaublich2• 12 months ago

The costs were always there, just externalized in the form of needless vulnerable road user injuries and deaths. Society pays a huge price for old, unsafe, polluting vehicles.

unglaublich2• 12 months ago

[..] emissions regulations [..]

Emission regulations have reduced the cost of cars, if you count the health and environmental cost that manufacturers and drivers simply externalized onto the pulic.

Yes, it became more expensive for the polluter, but rightfully so.

lenerdenator6• 12 months ago

But what about other expensive, complicated, things I want a choice to get rid of, major things I don't want to pay for, like .. auto stop-start, or the ability for the car to slam on the brakes by itself, or the ability for the car to decide to steer itself if it thinks I've strayed from the middle of the lane. Heck, I don't want a rear camera or blind spot monitoring, I'll check my blind spots myself. They're even working on mandating some sort of monitoring in the next few years to "detect" whether you might be drunk. What are the costs of all those sorts of things? All the sensors? All the computers? All the design/coding? The costs for maintaining all of it? The cost of the extra complexity? No mention of any of that?

Depends. The rearview camera thing? Probably not that expensive at this point; development costs have been amortized. Sensors probably are a bit more expensive.

The thing that chaps my ass about it is that there's so little commonality among parts between models and makers. We're 40+ years into the microprocessor revolution and ECMs are still mostly bespoke designs that have closed code running on them. Why? One way to deal with the design/coding costs would be to simply spread it across more automotive manufacturers, because at the end of the day, most of them are trying to achieve the same goals with regards to the function of the component. It's like looking at the different lug nut patterns between automakers... there's only so many ways to mount a wheel on a hub and you could reduce the tooling cost to make those wheels if you shared it with someone else.

(Also don't get me started on the extra cost and complexity and loss of maintainability that emissions regulations have added to cars. They used to be dead simple and maintainable.)

It's nice to have breathable air, no?

darth_avocado• 12 months ago

You didn’t talk about the biggest cost saver: not buying oversized SUVs. Cars got expensive because everyone was buying giant SUVs and smaller sedans and hatchbacks which usually covered 20-30k market, became less popular and therefore profitable to sell.

natch3• 12 months ago

You dying and/or killing and maiming others also has costs though. You present it as a one sided thing.

The keyboard you typed your message had a cost, yet apparently that was worthwhile so that all of us could contemplate your points.

bityard3• 12 months ago

Safety/emissions features are a much different animal than giant 15-inch touchscreens, seat warmers, persistent mobile data uplinks, and 25 buttons on the steering wheel.

Most of the things you listed are both a good idea and legally required.

tremon• 12 months ago

Automatic braking systems are only a good idea if they are 100% reliable, and everyone here will attest that no technology is ever 100% reliable. I'll reserve my judgement about whether it's a good idea until the first class-action lawsuits for spurious braking have been settled.

_fat_santa• 12 months ago

A big part of this is economies of scale, the reason your cheap compact gets a digital guage cluster is that the cluster has already been engineered and tested and it's just cheaper to slap that in there instead of re-engineering.

But while it makes it cheaper for the manufacturer and ultimately cheaper for the buyer on the lot, it makes for much more expensive repairs. I'm looking at you Ford with your $1200 taillights.

potato37328423• 12 months ago

I'm looking at you Ford with your $1200 taillights.

Those are not base equipment. But yeah the price is absurd.

AlotOfReading2• 12 months ago

The complete abandonment of budget models in the US is completely foreseeable from market dynamics and how the industry is structured.

1. Economies of scale are the only way to build a budget car.

2. The incremental costs of adding features are nearly zero. The vast majority of price comes from the basic costs of building a legal vehicle.

3. Buyers generally won't reject a car for having features they don't care about, but they'll frequently reject a car for lacking a feature they deem important.

4. Buyers have different preferences.

In order to sell at a low price, automakers have to sell as many as possible to hit massive economies of scale. In order to sell that many, they need to please a huge number of buyers, which means they add a whole bunch of cheap features to satisfy as many buyers as they can without cannibalizing their higher-tier offerings.

The other side of this is the price point that western OEMs can actually hit with economies of scale has climbed significantly in recently decades, in part due to inflation / wage pressures, but mainly due to massive institutional inefficiencies. Mary Barra's compensation alone adds several dollars to the price of each GM vehicle. Legally mandated dealer margins and fees add tens of percent to the price that consumers pay. The inefficiencies of spreading production for tax purposes across state and international borders adds more cost. So on and so forth, and the market feedback mechanisms to correct these issues are intentionally hampered by policy decisions to favor the current status quo.

Change in the market needs support at the regulatory level.

lenerdenator6• 12 months ago

Don't forget the way we handle fuel economy standards in the US... or did, given the way those regulations are being repealed for some reason.

Petroleum is a critical resource and most countries manage its use in automobiles for fuel in a fairly direct way: They tax the living shit out of gasoline and diesel. If you use more, you pay more. You have incentive to buy a smaller, more basic car because they will ultimately cost you less.

But not here. We gave exceptions on light trucks because that's all the big three could competently produce back when fuel economy standards were being introduced and we were getting our brains beaten in by the Japanese. Making more fuel-efficient vehicles requires R&D, and R&D spend is money not sent to a shareholder. Since the bigger vehicles don't count towards CAFE and smaller vehicles do, guess which vehicles the big three push harder to consumers?

AlotOfReading2• 12 months ago

That's a factor, though it's worth pointing out that California and Canada both have fuel taxes substantially higher than other parts of North America and light trucks/SUVs continue to outsell sedans significantly. Fuel taxes aren't irrelevant (sedans sell relatively better there than in other regions), but it's overwhelmed by buyer preference.

hobofan• 12 months ago

5. Americans widely have a high willingness to (over)spend on cars paired with a high affinity for debt

afavour• 12 months ago

In addition to this I think financing plays a huge factor. If an extra feature adds $2,000 to the cost of a car people will think twice. If it adds $5 to a car payment (that's already astronomical if you add it up, which they won't) they'll shrug and sign on the line.

csours4• 12 months ago

    > 3. Buyers generally won't reject a car for having features they don't care about, but they'll frequently reject a car for lacking a feature they deem important.

    4. Buyers have different preferences.

Yup. I don't care about the radio, and you don't care about manual windows, but you care about the radio, and I care about manual windows.

Gibbon1• 12 months ago

My theory is in the US light vehicle sales have been flat for 40 years. Yeah sales fluctuate depending on how confident people are.

Only way then to increase revenue is to sell more car.

jopsen2• 12 months ago

If you care are about cost, you buy a used car -- not a basic model.

If you buy a new car, you're already paying a premium. If you're willing to pay a premium, you were probably not looking for a basic model in the first place.

jopsen2• 12 months ago

Edit: I'd be interested in a more basic car, even new, not because of cost. But because I don't want my car to be a gadget that is outdated in 3 years.

I'll buy a new phone for the fun of it. Not a new car. So don't put a tablet in my car :)

Sadly, I'd suspect a tablet is actually cheaper than physical buttons.

os2warpman2• 12 months ago

It has been my experience that people who talk about cars are lying to themselves.

They say they want one thing, but buy another.

They claim they want a manual transmission and then buy a RAV4.

They claim they want a sports sedan and then buy a RAV4.

They claim they want a station wagon and then buy a RAV4.

They claim they want a base, cheap, simple, vehicle and then they drop $55k on a fully-equipped RAV4 Hybrid.

Be weird. It's ok. Do the dumb thing and follow your desire.

And you can hedge your bets. I bought, used, a manual transmission convertible sports car, a sports sedan (red, even!), and capacious station wagon for all of my Home Depot needs all for less than the price of RAV4 Hybrid and between the three I always have at least one functional vehicle!

SoftTalker3• 12 months ago

Exactly what I do. I own 6 cars. I didn't pay more for all of them combined than the cost of one new car.

SketchySeaBeast• 12 months ago

With 6 cars, how's the insurance cost?

WarOnPrivacy2• 12 months ago

I own 6 cars. I didn't pay more for all of them combined than the cost of one new car.

Seven but we have 3 drivers. Cars are 1961-2011 and 63, 96 & 2011 are current daily drivers. Every so often something under 40k mi shows up on FB marketplace under $2k and we grab it.

Our car insurance includes a $200/mo FU charge for living in FL. We're at no risk of flooding and carry liability-only. The forever-skyrocketing costs of repairing other drivers' new cars - this is a force multiplier on our premium costs.

Knork-and-Fife• 12 months ago

I think a lot of people do want these things, but car buying is not always up to just one person. It's often a decision made in the context of a family or group who will share a vehicle or otherwise have input on the buying decision.

These studies should be surveying these groups instead of individuals I think. Sometimes the "group" will just be one person, and that's okay. But I wouldn't want someone's opinion if they're making it on behalf of a group without the groups input, because that's not realistic

potato37328423• 12 months ago

Exactly. And this is the "magic" behind the Jeep Wrangler. It's the person driving it who you have to please but buyers have all these other spurious "requirements" forced upon them.

So they went out and built a 2dr jeep with a shitty 2nd row so people can pretend like it's optimized for people hauling and sell the "lifestyle car" they really wanted to their SO. They retained the soft top and manual at non-insignificant cost to appeal to additional swaths of buyers and then added a hybrid option as a checkbox exercise.

It's kind of beautiful if you think about it.

natch3• 12 months ago

Great post.

I think also in life your opening line can be generalized to:

It has been my experience that people .. are lying to themselves.

potato37328423• 12 months ago

Nobody can afford to "follow their desire" at new car price points so everyone buys blob SUVs that are the best bang for your buck.

chithanh2• 12 months ago

Is it like coffee? People say they want a coffee with a strong flavor but they then proceed to mask the coffee flavor by adding milk and sugar (or plant-based creamer and artificial sweetener).

dingaling• 12 months ago

And you can hedge your bets [ with multiple vehicles ]

In many countries that's unaffordable. In the UK I pay £350 per year car tax, £480 insurance and £50 mandatory roadworthiness testing. Best part of a grand before I've even driven a mile - and the UK is considered cheap in Europe. In Ireland the tax alone would be over £1000.

My partner pays about the same for her 20 year old petrol Honda SUV. Ironically if she chose the filthy, carcinogen-spewing diesel model she'd pay just £40 in tax, so it's little wonder that people compromise.

jonbiggums22• 12 months ago

And then there is storage/parking and maintenance cost and time. This is really why the SUV is so popular in the US. It has OKish cargo space for dump runs, family trips, etc even if it is oversized for the daily commute. But the base cost of a vehicle is so high you might as well get one that can get all the jobs done.

rainsford• 12 months ago

I think there is definitely some self delusion happening on the customer side, but automakers absolutely shape your purchasing choices away from what might be your ideal vehicle to things that are good enough vehicles for more people.

More people naturally want a RAV4 than a manual station wagon, but the automakers would prefer that even the folks leaning towards the manual station wagon leave the dealership with a RAV4 so they can just make the RAV4. So manufacturers offer nicer features it would make sense to offer in any vehicle exclusively in models they want to steer customers towards, like nicer seats, better sound systems, advanced safety features, etc. Subaru sells both the Impreza hatchback and the Crosstrek, which is literally just a lifted Impreza. But if you want non-cloth seats, roof rails, or even a spare tire, your only option is the Crosstrek. The conclusion that everyone wants crossovers is driven in no small part by the fact that buying a crossover is often the only way to get features customers want that should be, but are not, model agnostic.

jjav2• 12 months ago

all for less than the price of RAV4 Hybrid

Can't recommend enough this approach of multiple older cars. Between the extremely high cost and steep depreciation new cars make no sense unless you're so rich money is not a consideration.

I have multiple sports cars (all over 30 years old), a truck for towing and utility (over 20 years old), a minivan for kid and family duty (~15 years old). All that together is cheaper than a single new car. And having bought them depreciated, the value barely goes down. In fact a couple of the sports cars are appreciating now, worth more than my cost.

ckjellqv3• 12 months ago

I've thought for a long time that offering only electric vehicles with 200+ mile range as the base availability is overkill. I drive a short commute to work and then maybe 2mi to the grocery store and I have no other needs. Otherwise I take plane/train.

The common arguments I hear are 1. What if I need to take a roadtrip? 2. What if I don't have accessibility to a charger at home or work and need longer range to account for that.

Only (2) seems reasonable to me, but many do have access where they live. Seeing as the huge expense of EVs is batteries, I'd love the option of something with a much, much reduced battery (and the additional reduced feature sets the article mentions).

benzible• 12 months ago

EREVs appear to be a good solution....

https://www.motortrend.com/features/what-is-an-erev-extended...

ckjellqv3• 12 months ago

for the people that want roadtrips and incredibly large range. Sadly it seems like many of the cars in the article are plopping ICE generators on top of EVs with already 300mi of range.

chithanh2• 12 months ago

The reasonable way is to buy a PHEV and use the fuel tank as range extender for occasional extended roadtrips or when chargers are unavailable. However that may or may not be desirable when it comes to regulatory concerns (taxes etc.).

ckjellqv3• 12 months ago

But even so, these extra tanks and ICE engines contribute to the cost and weight of the vehicle when the objective for me is to minimize cost given that I don't drive more than 100mi/wk. I could do with with 100mi of total range or less without need for an ICE generator.

Bukhmanizer• 12 months ago

Budget car buyers likely don’t make a good customer base. People who want their new car to be mostly like their old car probably will just drive the their old car until it breaks down then get a used car.

When I was looking for a car I was looking for 3 things: 1. Low gas mileage 2. Cheap/Reliable 3. Not run by Elon Musk

So I got a used Corolla Hybrid and plan on driving that for at least 5-10 years. But I understand that I’m not a profitable customers to most car companies.

cnst• 12 months ago

This is exactly why I got a Model Y AWD with all the default options.

It basically has everything you need, and is Long-Range, too, without having to decide whether or not you want a mutually-exclusive "technology package" or "XXX package".

Without having to decide a whole bunch of other things, too, which, if you don't get, won't give you the advertised features seen in commercials, and if you do, won't keep the advertised price of the car.

darksaints• 12 months ago

I'm actually a huge fan of the extreme level of simplification that electric cars have to offer. They literally eliminate the need for thousands of high maintenance moving parts, and replace them with motors that can run hundreds of thousands of miles without service. Regenerative braking reduces brake wear and maintenance dramatically. 4 motor setups eliminate complex differentials and give you extremely high quality awd, traction control, and stability control, without any increase in mechanical complexity. You get better low-end torque output and smoother power curves. The only mechanical features that really remain the same are bearings and suspension components. Complexity still exists, it just has been offloaded to electronic complexity which has become orders of magnitude more reliable and capable in the last 4 decades.

So please, could we just have that? Just because it's easy for you to add internet connectivity doesn't mean I want it. I don't want my car to rat me out to megalomaniac dictators because my car company's psychotic CEO wants a sweetheart trade deal. I don't want my car to create data trails that will allow advertisers to see places that I frequently visit, regardless if that place is an oncologist or my friendly neighborhood dominatrix. I don't want my car to know my retinal data or fingerprints, to be controllable via my phone, or to tell me that my resting heart rate is. Just give me a car, and let me do the rest on my own.

bryanlarsen2• 12 months ago

https://www.slate.auto/en

csours4• 12 months ago

Imagine manufacturing like a long vine - any disturbance along the vine can cause the fruit to wither.

The overall company can run low on capital or the share price may drop too far and induce leadership changes.

The product has to reach capacity targets to pay for overheads and fixed costs.

A competitor can drop their prices.

A supplier can go out of business or have their own production issues - fires and floods happen ever year.

Many governments have ramping targets for safety and efficiency.

Any particular government can increase taxes or tariffs, causing an unplanned uprooting of production from one assembly plant to another, costing at least millions of dollars; also unknown costs due to uncertainty.

Consumers preferences change over time.

---

With all of that, the fruit that withers first is the smallest - the cheapest or leanest.

I'm sorry if this is upsetting.

zevon• 12 months ago

There are many, many K.I.S.S. cars out there. They are used, old, cheap and can still run great. Personally, I really do not want to have a car with any kind of computerization (other than a basic ECU) and more complexity and weight than it absolutely needs to have. Fortunately, I'll be fine - I doubt the supply of old cars runs out before I shuffle off this mortal coil.

opwieurposiu• 12 months ago

If you want simple get a motorcycle. Most do not even have a radio.

I got an almost new BMW 310GS for $5k. Even at that price it has antilock brakes, slipper clutch, throttle-by-wire. Any idiot could ride this bike, and it gets 60-70MPG.

Now I ride it every chance I get and keep the miles off my $40k pickup truck.

twoWhlsGud• 12 months ago

Budget car buyers aren't driving the market - especially not the market for new cars. In the US income inequality has gotten to the point where most new cars are bought by upper income customers. And they want fancy SUVs. Budget car buyers purchase their cars in the used market. For them it would in fact make sense to purchase less expensive more efficient vehicles. But they don't get a vote (in theory a lower depreciation for such vehicles should flow up, but I don't think that signal really gets anywhere now.)

bryanlarsen2• 12 months ago

Most people with a < $30,000 budget buy a used vehicle. They get a lot more car for the same amount of money. So the market for a cheap new car is pretty small.

Which screws up the market for those who have a $10,000 budget for a car. Most of them would likely prefer a 5 year old $20,000 car than a 15 year old $50,000 car, but the market has very few of the former.

M95D2• 12 months ago

people interested in buying cars under $35,000 would rather have the option for more basic vehicles in order to keep costs down and repairs simple.

See the problem? It's right there in the quote.

Car manufacturers are in the business of making money, not cars. People that want to keep costs down are not the kind of customers they can make money from.

In fact, they would be happy if no other manufacturer would have them as customers, because that would mean those people will succeed in spending less, grow accustomed to the ideea of not having to spend a lot on a car, and possibly hijack some other customers that would have bought an expensive car.

Budget Car Buyers Want Automakers to K.I.S.S

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