In reviewing all the trends from 2025, the one standout factor is affordability. The one predictable factor in an unpredictable year is that the so-called K-shaped economy is playing out as you’d expect, with the wealthiest Americans mostly unaffected by new car costs and financing. The not-wealthiest Americans? It’s a slightly different story.
Data is grist for The Morning Dump’s hamster-powered mill, and a new bit of data about how fast cheap cars are selling is yet another reminder of the opportunity that exists for brands that can serve this market.
The affordable EVs that are popular in Europe and China haven’t quite made it here, and the projected slowdown in the electric car market is one reason that Ford and its battery partner SK On are splitting up their plants. Hybrids are likely coming, and Europe is considering letting hybrids pass as a gap technology towards eventual electrification.
Let’s end on a weird one, eh? An American company bought Italdesign, and it’s not the American company you’re probably thinking.
Cheap Cars Are Moving Fast, But There Aren’t Enough Of Them
For all the talk of people wanting affordable cars, what’s been lacking in the universe are great cheap cars. Even though there are plenty of automakers that build affordable cars, those aren’t necessarily easy to find on dealer lots, which is one reason why the average transaction price rose above $50,000 this year.
Do you want some proof of this? Courtesy of Automotive News comes this wild stat:
New-vehicle inventory in the U.S. fell 1.6 percent in November to 3.09 million at month’s end, with vehicles priced less than $25,000 spending just 1.5 days on dealership lots.
But supplies rose to 73 days’ worth from 70 the previous month, according to an estimate by Lotlinx.
A year earlier, new-vehicle inventory was 3.17 million, representing a 69-day supply, Lotlinx said.
Sales days can be looked at in two ways. If something has an extremely low number (anything under, say, 40 is low), it can be because it’s extremely popular. It can also mean that there just aren’t enough of them in dealer inventory. In the case of affordable used cars, it’s probably both. There are cheap cars out there if you want them, but keeping them cheap is going to be a challenge, as 92% of cars under $30,000 are built in foreign countries. With tariffs up, that’s putting pressure on prices.
Looking at what’s available from Cars.com, many of the cheapest cars are sedans and hatchbacks from Nissan and Mitsubishi, with many of them 2024 or 2023 models that have been stuck on lots. This is not just an MSRP problem; it’s a financing problem. If you find a $24,000 car you like and have even average credit, you could be looking at paying more than $400 a month for 72 months with a $1,000 down payment. That’s rough.
I still think this is an incredible opportunity for automakers with plants in the United States to make the math work and pick up volume with something good and affordable. Is there a way to get the Toyota Corolla Cross down to a better price? According to Cars.com, there are exactly three Corolla Crosses and two Corolla hatchbacks for sale in the United States. More!
SK On And Ford Break Up Their Partnership
Ford has been somewhat aggressively rethinking its partnerships this year as it tries to pivot into whatever the future will bring. The latest move impacts Korean battery partner SK On, which planned to operate three battery plants jointly with Ford under the BlueOval SK umbrella.
Instead, SK On will take over full ownership of the Tennessee plant under construction, while Ford takes the two Kentucky plants (one of which is operational). Why is this happening?
The Korea Herald has some insight here:
Industry officials say the split may ultimately work in SK On’s favor. Ford has slowed elements of its electrification road map, delaying several next-generation battery models and adjusting production plans. BlueOval originally projected that both the Kentucky and Tennessee plants would begin operations in 2025, but only the first Kentucky site has come online.
“Ford has steadily scaled back its EV rollout and is showing increased interest in internalizing battery technologies,” an industry source said. “For SK On, the separation provides flexibility to direct capacity toward clearer demand — whether EV or ESS.”
Relying on an American automaker to be your main client for batteries doesn’t seem like a safe bet right now, and if SK On can redirect some production towards energy storage systems (the ESS referenced above), that might be the easiest way to go.
The Tennessee plant is still a part of Ford’s campus in Tennessee, so it’s not a complete breakup.
The EU Is Considering Becoming Super Pro-Hybrid, But There’s A Catch
The European Union has slowly realized that its plan to ban all combustion-powered cars by 2035 probably isn’t going to work, especially if it wants to keep Germany as a going concern. It’s why the European Commission is reportedly planning to add plug-in hybrids and EREVs to an extension, sort of.
The commission’s strategy is to allow a five-year extension of the use of the combustion engine until 2040 in plug-in hybrids and range-extended vehicles. That will be based on the condition that they will run on advanced biofuels and so-called e-fuels — made using captured CO2 and renewable electricity — as well as use green steel in their manufacturing, according to people familiar with the matter.
Such a design will enable the EU to still aim for zero emissions in new passenger cars by 2035, depending on the exact parameters of the proposal, the people said. It will also address the concerns of several car and parts producing nations, which called for clean technologies other than pure electric vehicles to be used after that date.
Having spent the last years trying to make hydrogen happen, a lot of companies are switching focus to eFuels.
Wait, Who Bought Italdesign?
Famed Italian design firm Italdesign (great name!) was purchased by Audi during its last spending spree, but now Audi is short on cash. It’s been known for some time that Italdesign was on the list of assets up for sale, and now there’s confirmation that the company has been sold to a United States firm called UST.
Do I know or understand what UST does? I do not. The company’s homepage claims that it does technology consulting services, and there’s a lot of AI talk. Why did it buy Italdesign? From the company’s press release:
The majority takeover of Italdesign by UST creates a strong partnership that combines UST’s expertise in automotive engineering, artificial intelligence, software-defined vehicle development, and digital ecosystem design with Italdesign’s deep knowledge in vehicle and product design, engineering, prototyping, small series production, and automotive electronics. Together, the companies will be able to offer a comprehensive and integrated range of services – from early concept and design to hardware and software development through to production systems. This combined capability is designed to support the development of fully modern, digitally enabled vehicles.
In addition, UST and Italdesign intend to extend this integrated approach to a global scale. UST will enable Italdesign to expand their international presence across UST’s global footprint in over 30 countries. As the new majority owner, UST will assume operational responsibility while honoring and building on Italdesign’s Italian heritage, design culture, and the talent of its employees.
So long as this means we’re getting another Italdesign Columbus, I’m cool with it.
What I’m Listening To While Writing TMD
It would be too sad dad of me to play Yo La Tengo’s “Autumn Sweater” right? Here’s Palehound’s excellent cover from 2022.
The Big Question
Go on your favorite new car sales site and tell me what you’d buy under $25,000. Show me the link to the exact car.
Top graphic images: Toyota; DepositPhotos.com
Not much for under 25 (18 USD) in Canada, only came up with the Hyundai Venue:
https://www.hyundaicanada.com/en/shopping-tools/buildandprice/build?step=2&model=2026-venue
or the Mitsubishi RVR:
https://www.mitsubishi-motors.ca/en/vehicles/rvr-2025
I have zero knowledge of the two, but the RVR is better looking, so that’s my choice.
Good TMD question today. Has me looking at new cars I frankly wouldn’t otherwise go through a configurator on.
I’m going to say 25k must include destination and must be MSRP and go for either the Kia K4:
https://www.kia.com/us/en/k4/build?step=build-summary&exterior=Deep+Sea+Blue&interior=Gray+%26+Black+TriCot+Cloth+Seat+Trim&model=23422&trim=LXS
(Reserve the right to replace that with the hatch when it comes to America)
Or, as covered in these pages, a 2026 Nissan Sentra in the SV trim.
Here are my choices under $25k
2025 Mazda Mazda3 for $22,445
https://www.autotrader.com/cars-for-sale/vehicle/755085759
or
2026 Nissan Leaf for $15,267!!
https://www.autotrader.com/cars-for-sale/vehicle/766687857
adding Kia Soul for $18,663
https://www.autotrader.com/cars-for-sale/vehicle/753960522
Is that Leaf price a typo??
I believe it’s including a Colorado tax credit or something. Land of the free Fiat 500e
Damn. That would be an incredible deal
It’s almost certainly post discounts and incentives
ah, includes $9k for VXC Rebate (Colorado Vehicle Exchange Program) which needs to be low income qualified.
Not to mention you also need to be a Colorado resident.
yup, just saw that. Welp, I picked the wrong state to live free and die in, I guess
Its probably because its limited to level 2 charging only so 0-100% takes 12 hrs minimum.
Honestly, for that price I’d still be tempted if I qualified
need to be below 80% of avg mean income for your county
That MAZDA has me thinking. Hard.
Thanks and damn you! /s
Don’t worry, our brilliant leader has a foolproof plan:
Make affordable vehicles unaffordable with tariffs and make expensive vehicles ever so slightly less expensive by making them thirstier and dirtier.
Your kid does not need 30 dolls for Christmas…(TURD)
2029 can’t come soon enough.
“Shut up Piggy..”
Test
Good points.
2029 can’t come soon enough.
Apparently, we’re pirates now too.
I’ll take this 2025 Honda Odyssey for $437.
https://www.cars.com/vehicledetail/5250f6aa-2b63-4d46-9b16-44bb2bdd4628/
Realistically, though, a Santa Cruz would be ok, although I’d rather have the Turbo 4.
https://www.cars.com/vehicledetail/aebfbc98-0ded-4599-8676-1be71ed6f897/
I’d pay $437 for any Odyssey from the last 25 years that is still drivable.I guess the new AI posting bot missed a comma after the 43 and will be fired soon.
“The commission’s strategy is to allow a five-year extension of the use of the combustion engine until 2040 in plug-in hybrids and range-extended vehicles”
CALLED IT!!
(TBF so did almost everyone else)
“That will be based on the condition that they will run on advanced biofuels and so-called e-fuels — made using captured CO2 and renewable electricity — as well as use green steel in their manufacturing, according to people familiar with the matter.”
And I’m calling this one: Ain’t gonna happen. There simply isn’t anywhere near enough surplus renewable energy and will not be for the foreseeable future, even if Germany were to swallow its pride and return to nuclear.
Germany, swallow its pride? Nein!
If they have to use renewable energy to produce hydrogen to react with captured carbon dioxide, then there will never be enough. It looks like the plan is to grow castor oil on degraded arid land, and make that into hydrotreated vegetable oil. The hydrogen can come from BASF, who has developed a methane pyrolysis process with help with funding from the German government. The castor oil they are buying from Africa contains most of the energy, but the imported LNG helps too.
Biodiesel funded by the German government eh? Gee I WONDER who’s behind this idea…
OK I’m calling this one too: Dieselgate 2.0
This time it is HVO and not biodiesel. HVO has to go through a refinery after it is treated with hydrogen because it contains a mixture of hydrocarbons that can be made into jet fuel, gasoline, and diesel.
Tomato tomato, it’ll still end in scandal.
“According to scientists at Kenya’s Jomo Kenyatta University of Agriculture and Technology working with Eni, the castor oil plant is a “low-maintenance, drought-resistant crop with low environmental impact” that will significantly reduce carbon emissions. However, the fact that castor-bean seeds also produce ricin, a toxic substance that is poisonous to wildlife, livestock and humans, seems to be ignored by all sides.”
Probably money to be made in monoclonal antibody medication for ricin toxin.
Ricin is a protein that isn’t soluble in the oil. It also deactivates easily with heat so decontamination isn’t hard. The water soluble products which contain the toxin are autoclaved per standard procedure.
As for concerns the bad actors might their hands on the active toxin there are way easier and more toxic things for them to get their hands on. Like Foxglove, Belladonna, Nightshade, Oleander. Or if they just want to be irritating there’s plenty of Poison Ivy/Oak/Sumac out there.
I think the highest risk comes from spreading the cake as a fertilizer, because if you are going to just dump it in a field there is no way you are also going to spend the time and money to autoclave it. Probably would be better for the worker if they wear a respirator. Or even better would be to knock out the gene that makes ricin.
I think ricin poisoning is pretty low on the list of things farmworkers need to worry about. They probably face a much greater threat from the spreader itself.
If I could buy a stripped down mini truck with a real bed for $25k I’d be all over it. Since mini trucks no longer exist in this country I’ll keep buying 20-year-old $3k beaters and running them into the ground…
This…
I’d be happy to buy a decent sub 30K truck.
I would probably buy this Buick Envista from a dealership that’s 45 minutes away from me at $23,999.
https://www.cars.com/vehicledetail/04453540-281c-44e1-9198-b4d07cfa54dd/
I think these are handsome little cars and the entire engineering brief behind the new compact GM cars was “make something affordable that doesn’t suck ass”. The general consensus seems to be that they’ve succeeded. I’d prefer a hybrid in this day and age but you’re not getting a new hybrid for under 25k.
That being said, you’ll still see new Civics pop up for under 25 here and there and that’s almost certainly your safest bet long term.
https://www.cars.com/vehicledetail/ae6c0715-c871-41a1-83df-30d83ca9b989/
I saw a Buick of some sort on my way to work this morning that was in a very fun electric blue color that I liked a lot. It was a normal CUV shape, so not the Envista, but I’m with you. Those are nice cars, especially for the price! My favorite is a copper/red color they have. Buick does not resemble the septuagenarian company it used to at all anymore and while nothing they make is particularly exciting, I love the colors they have embraced lately.
All of their current lineup looks great! Would I choose to spend my non-internet money on one? Probably not, because GM’s non-truck powertrains are a generation behind. But you could do a lot worse if style is something you prioritize.
Yeah aren’t they tiny 3 cylinder turbos in the Envista and others? They seem too pathetic for my tastes, but I appreciate that they are making small, cheap cars.
Yeah they’re gutless little things. 0-60 in the 9s if I’m not mistaken. I know we have members of the commentariat who’ll proclaim that that’s fast by their standards but here in the DC area it’s dangerously slow. We have some of the most dangerous and aggressive drivers you’ll ever see and there have been plenty of times that the only way for me to avoid disaster was to absolutely punch it to get away.
I’m not someone that thinks a car needs to hit 60 in the 3s to be fast and honestly even my Kona N is on the verge of too fast for me to enjoy without getting in trouble…but once you’re flirting with the 10 second mark it just makes things harder than they need to be unless you’re way out in the sticks.
Meh, My roadster takes more than 8 to get there and it’s never been a problem anywhere, but I get it. I can handle gutless, but there has to be some fun to make up for it, and I think this is lacking there as well.
DC is the only place i consider this a valid excuse.
If you’re on an on ramp absolutely no one is going to willingly let you in, and an unfortunate amount of exits are weave exits that give you like 100 feet to make your move or get turned around for another 5 minutes. There are, somehow, situations where just absolutely gunning it is the safest thing to do.
And on top of that you’ve got the never ending supply of assorted Nissan and Stellantis products in various states of disrepair being used as makeshift ICBMs to deal with as well. Sometimes you’ve got to be able to suddenly speed up to get away. Anyway, yeah…I wouldn’t want to have to manage driving around DC in an objectively slow car. I feel like I’d be a sitting duck.
These always seem pretty quick off the line. My theory is the acceleration is not that bad 0-30 mph with lots of turbo in low gear.
Yeah I drove a rental Rogue with a turbo 3 back in October and it felt downright peppy off the line. Once you hit about 40 or so it completely ran out of steam though. I’d assume these are similar.
There is probably some very intentional tuning going on to make driving dynamics acceptable to the average customer based on psychology. Peppy off the line makes it seem faster, even if 40-60 takes forever. All in your head though.
When we visited the wife’s friend in the DC metro, it seemed that merging onto the highway actually took place at 45 mph. Metro Detroit is actually worse for having a short ramp before 75 mph traffic.
I see one of these on my daily dog walk, it’s a decent looking little car. I’d drive one. I just wish the mileage was a little better, IIRC the combined is in the 20’s. Not great for a small-ish FWD car with a 3cyl.
If an engine isn’t going in a truck GM is not going to put effort into it, unfortunately.
And even then they can’t seem to get it right.
I used to think that GM trucks had the best engines, but those days are over. I didn’t even consider GM when I was truck shopping.
Fingers crossed the 3.0 Hurricane turns out to be durable.
Edit: FYI – I traded my 4Runner for a 26 Ram 1500 Hurricane.
-Mike B
Yeah that 6.2 liter has been an abject disaster, which sucks because it’s a badass engine. Hell the 5.3 hasn’t exactly had a stellar record either. I think the Babymax is a really cool but I have no need for a half ton truck so I’ll probably never experience it.
Early returns in the Hurricane are promising. It seems like it could be one of the rare times Stellantis got something right, but we’ll see. I’m definitely going to look at the Charger six pack the next time I’m shopping.
I’d argue that over their many names and owners, Stellantis has one of the best track records of making engines. It’s what’s attached to them that’s the problem.
In the owner’s groups, the main issues are electrical. Hopefully, having a low spec truck insulates me from a lot of that. For instance, there seems to be an issue with the fully LCD clusters coming out, but I have the standard cluster.
As far as the driveline, the ZF 8speed is supposed to be bulletproof.
I think an inline 6 is inherently robust, and I know this is a closed deck block as well, which is good for strength.
I’m loving this engine; this truck is QUICK. I’ve been going easy on it, but I’m finally past 1k miles and I booted it on the highway the other day to pass a line of cars, and it threw me back in the seat from 70. Best thing is that it’s relatively silent, it did it was no drama and hardly any noise. My 4Runner would have been SCREAMING bloody murder had I done that.
If you don’t need a loud engine, you will LOVE the Hurricane.
An I6 is my favorite configuration, by a long shot. It’s only problem is actually fitting in a car if it’s transverse FWD. I think both the Supra and Semi trucks prove that you can get a lot of power out of them, reliably, forever. There’s a lot of bad things that can be said of Stellantis products, but as far as their engines I think they’ve got to be just barely behind Toyota, Yamaha, and old Cummins.
Oh if I suddenly needed a half ton for god knows what reason I’d either get a RAM 1500 with the Hurricane or a Silverado with the Babymax.
I was prepared to settle for a bare bones Corolla, but then I saw these. I didn’t know they were even a thing, but I could live with one. Plus, bare bones Buick has that alliteration going for it.
So we are:
#1: Looking for a new car under $25K
#2: Shopping firmly in the middle of the decade of the hybrid
The easy answer is the Hyundai Elantra Hybrid
https://www.autotrader.com/cars-for-sale/vehicle/765385243?city=Apex&fuelTypeGroup=HYB&listingType=NEW&marketExtension=off&maxPrice=25000&searchRadius=100&state=NC&zip=27523
This would likely be my answer. Even the non-hybrids are very efficient, my GF’s 2021 model easily gets 40+ mpg on my commute.
That’s a really good price, well spotted!
This would be tempting – I have a coworker with one I’ve rode in a couple times. The blue color is great and he loves the thing as so far it’s been trouble-free and cheap to run.
With Cross sales up YoY through Q3 by 8.8%, I don’t think they’re interested in doing so. Even Corolla sales are up across the line (hatch I don’t see broken out) by 2% and that’s been tight on supply. A good turn rate is going to be seen as a feature here, not a bug. They don’t have to put cash on the hoods of the cheaper lower-margin cars to move them.
If I can’t have this mispriced Tacoma, I might do a Jetta but more likely a Mazda 3 or CX-30.
Toyota factories are dialled up to 11 for popular models.
Next year most likely going to be looking at a new Trax for the fiance once her current lease is up. Not sure if it will end up under 25k or not but should be reasonably close.
A cursory search and saw two RF model Miatas with a manual at the same dealership.
https://www.autotrader.com/cars-for-sale/vehicle/766959971?city=Mason&listingType=USED&makeCode=MAZDA&maxPrice=25000&modelCode=MAZMIATARF&searchRadius=100&state=OH&transmissionCode=MAN&clickType=listing
Or maybe a ’23 Subaru WRX.
https://www.autotrader.com/cars-for-sale/vehicle/766642220?city=Mason&listingType=USED&makeCode=SUB&maxPrice=25000&modelCode=SUBWRX&searchRadius=200&sortBy=yearDESC&state=OH&transmissionCode=MAN&clickType=listing
EDIT I guess I was a dummy & searched Used instead of New? F it, I stand by my choices.
TBQ – honestly, there isn’t anything I’d really want to buy brand new for under $25,000. I’m more likely to search for something used under that price-point I find appealing and useful.
Big Question: If I’m not allowed to push up to a Civic Hybrid, I would probably skip the ICE Civic and get a decently equipped Sentra for about $18.5k. Everything besides the CVT is reasonably robust (it’s pretty hard to mess up a low-stress NA I4). I would then budget a few grand for when the CVT inevitably fails around 100,000 miles.
I’m really happy that cheap cars are poised to make a comeback. (I’m not happy with the economy that is forcing their return, however). As a bottom feeder, I was really disappointed when cheap new cars made their exit from the market during the Covid car bubble. But it was really only a matter of time before they came back. OEMs will only sit idly by for so long as 5-year-old Toyota Yarises and Honda Fits, with 30k–70k miles sell for new MSRP. Honda, please bring back the Fit.
Apparently if you treat the CVT fluid as a maintenance item they’ll last longer. The problem is people are not used to ever thinking about their automatic transmissions.
That’s what I am hoping with our Altima anyway.
That’s currently what I’m doing with the wife’s Rogue. Right now, I’ve been doing it every 20k miles, but that is an arbitrary number I made up. How frequently have you been doing it?
We inherited the Altima at 32k. It now has 41k. I am just aiming for anywhere before 50k. Is this something you do yourself? New territory for me, but likely doable.
I’ve done the fluid twice myself and replaced the trans filter once. It’s definitely doable by yourself. The Rogue didn’t come with a trans dipstick, so I had to buy one; they’re inexpensive on Amazon. I’d say it’s probably twice as hard as changing your own oil. The dipstick tube is lower in the engine bay, so you need a long skinny funnel (I used aluminum foil to mixed success). And the filter is a cartridge type that requires removing a piece off the side of the transmission which is pretty blind and tight to reach. I was able to do all this less than two hours in an apartment parking spot.
The first time we did it on the Rogue was about 100,000 miles. (it was well used when my wife got it). I then did it again after 10,000 miles to A. try and flush anything I missed the first time. And B. satisfy my curiosity as to what the fluid looked like after 10k. It was certainly used, but it didn’t smell burnt and it didn’t have metal flakes.
I own a 2015 Fit that I baby. It has depreciated very little compared to the typical new car purchase. It has 96K miles and re the CVT, I’ve had the fluid changed twice with another change coming up next year at its next visit to the mechanic.
2025 Subaru base Impreza 24k. I bought one a year ago for 25K….heyyyyyyyyy!
https://www.mcgovernsubaru.com/new/Subaru/2025-Subaru-Impreza-newington-nh-5572bf99ac18490c67c51ee2658c5eb1.htm
It’s expensive to be poor.
By design. Capitalism is working exactly as intended.
Not a bug, a feature!
So cars that cost less means they are more available to more buyers? What????? They should teach a class about this or something!
This is some Nobel Prize shizz.
Now Trumps interest in Kei cars makes sense. He’s angling for rewards.
Well, I did that already this year… bought a leftover ’24 Forte GT for $25k in February.
Ohhhh pretty good.
So, logically, a car under $13,000 would sell 96x faster? Malcolm Bricklin – there’s your next investor pitch, go ahead and run with it
I keep saying we need a new Malcolm Bricklin who takes a cheap car from a country with a relatively low tariff (say 15%) and import a bunch of ’em.
Malaysia is at 19% and the Proton Saga is like $9200 on the domestic market, with wholesale pricing, volume discounts, etc, maybe close?
If someone could mobilize the millions of penguins on Heard and McDonald island, they may have a shot. Their tarrif is only 10%.
But we’re still getting screwed by them.
And they live on shit hole islands too.
And they’re eating the Dogs, they’re eating the cats!
“expertise in automotive engineering, artificial intelligence, software-defined vehicle development, and digital ecosystem design”
Three of those four items are why cars suck these days.
I am confused by the question? Are we looking at new cars and saying which we would buy if they were used for under 25k? Or are we looking for a new car under 25k? If the former I was near that when I bought my Polestar 2 used earlier this year for like 26k. If looking for a new car under 25k *shrug* haha
I read the comments on here and I keep reading that “cheep cars just sit and don’t sell” and “nobody wants cheep new cars they are too small and used cars are bigger and better” so what does this data say about those comments?
That they are made by industry plants.
All cars are made by industry plants. I’ll show myself out.
Well I think those are two different things. A base model mirage would probably sit on the lots much longer then a slightly used civic or Camry that is full optioned for under 25k especially if it is CPO or still in warranty. People might say they don’t want all the creature comforts on here and want a basic car but that is people on here not the US car buying mass as a whole.
Oh they sell, they always sell – provided automakers do two things 1) build them and 2) make sure all potential customers know they exist. There’s not much interest in either, since the cheaper the car, the thinner the profit margin
But, a new market entry that specializes in cheaper cars without existing higher margin products to undermine wouldn’t have such concerns
I agree. When I say that here there are always naysayers that tell me I am wrong that cheap cars cannot sell.
Look at the sales figures for cars like the Versa over time.
https://www.goodcarbadcar.net/nissan-versa-sales-figures/
No one is disputing the fact that cheap Toyotas and Hondas sell, they always have.
No one disputes that small CUVs sell, only that small sedans rot away unsold.
Even Matt in the article talks about MY2023 and 2024 Mitsubishis and Nissans still on lots.
That they are lumping in used cars with new cars.
It is also conflating supply with demand. Sure, there is LOTS of demand for cars under $25K. But the demand is for cars that are generally nicer than what is available NEW for under $25K, so well-priced nice used cars sell really fast. As I have said on here many times, you would have to have your head examined if you buy a new Mirage over a CPO Camry or Corolla for the same price. And on the supply side, there is simply no money to be made on those cars, so since automakers no longer have to make them, they mostly don’t.
Though that said, I think the real break point is a little bit lower. $25K is a reasonable bottom number for a new car to me, even a little lower (my mother’s Soul at $21K was a deal, but that car is dead now). Under $20K today is fantasy-land from the supply side, particularly with the tariff nonsense. The cost structure of the US automakers rules them out almost completely, at least if built in the US.
It tells you there is a sweet spot for cheap yet well equipped cars in the low $20K range. The Trax is an example of that sweet spot.
Why are there more than 100 leftover 2024 Mirages sitting on dealer lots today – some priced as low as $13,355 if people are clamoring for a cheap new $15,000 hatch?
Crap the destination fee kicked it over $25K is that ok? https://www.kia.com/us/en/seltos/build?step=build-summary&exterior=Steel+Gray&interior=Black+Cloth+Seat+Trim&model=K2422&trim=LX
“splitting up their plants”
Had to read that a few times. Morning Dump, indeed.
It was some bigwig from Buick (I think) that famously said, “If you want a cheaper Buick, buy a used Buick.”
That’s great for profits, but when fewer and fewer people are buying new cars (selecting used cars instead) at some point the supply of used cars starts to get thin.
Typical short-term thinking from corporations.
I don’t know when that quote is from, but it is certainly ironic now, because a majority of the Buicks I see are Encores and Envistas—their cheapest models. Granted, I do see a decent number of their Traverse/Acadia equivalent too.
Thing is, while those “start” at $25-27K, I think you will find that most of them actually sold are close to or well over $30K with trim levels and options. And of course, don’t forget that almost $1800 destination charge, which is nearly pure profit and non-negotiable.
If we had a real government, destination charges would be banned. That’s overhead, and should be accounted for in MSRP to start with. It just allows (falsely) advertising a lower price. Same with doc fees, of course, beyond the actual fees charged to a dealer by the state.
Oof, I didn’t know they were that much. I wouldn’t touch any non-truck GM product for more than $25k tbh. Especially with a high-strung 3 cylinder.
I agree about the destination charges and other nonsense. Dealers have operated maliciously for far too long. No one with any power cares though. So, I doubt it will change. The dealer lobby is also super strong.
Based on my personal experience with them, I wouldn’t buy any of their trucks either. All three of the Detroit trucks are overpriced junk today, IMHO.
I do agree about the fad for tiny turbos. I LOVE a properly designed turbo – ~2.0L 4cyl with 200-250hp is a real sweet spot, IMHO, but these 1.2L triples are yet another shark jump. Will be interesting to see how they age.
Every new car becomes a used car the day you buy it. We are not seeing big drops in sales numbers. And even if we do – it’s better to make more profit on fewer cars than small/no profits on huge numbers of them. Something the auto industry has finally figuring out.
The market was distorted in the US for a LONG time by CAFE. Automakers, particularly the Detroit 3, HAD to sell cheap, fuel efficient cars for no money or a loss in order to be able to sell all those fat profit trucks. With footprint CAFE, that all went away, very much by design. Today they can just sell those fewer fat profit vehicles across the board.
Is it short-term thinking? I really don’t think so. Automakers are not charities, they exist to maximize profits.