Home » How New And Used Vehicles Are Impacting Inflation

How New And Used Vehicles Are Impacting Inflation

Tmd Top Prices Down
ADVERTISEMENT

If you’re a finance nerd or armchair economist it’s been an exciting morning as one of the big monthly measures of inflation is out, and it was both flat and better than expected. A big driver of the downturn? Automotive sales. Hey, we talk about automotive sales here at The Morning Dump.

This is good news. Let’s celebrate good news. Part of my guess that the market would reach 16 million sales in the United States in 2024 was based on a rate cut from the Fed before the end of the year and it seems like that might be coming. It’s not a lock, of course, but cheaper cars are definitely helping.

Vidframe Min Top
Vidframe Min Bottom

Will automakers allow this to happen forever? Maybe. Maybe not. Ford’s CFO is warning against automakers flooding the market with inventory as in the past. On the other side of Detroit, GM’s CFO is saying it’ll build fewer EVs while handing bucks back to investors.

On the other side of the pond, Chinese cars are going to get more expensive as the EU announced tariffs. How are Germany, China, and France going to respond?

CPI Was Flat In May As Cars Go Way Down

Costvincentivechart
ATP v Incentives. Source: KBB/Cox Automotive

How much is the stubbornness of inflation tied to the automotive industry? While car sales and car ownership are only part of the overall economic picture, the costs associated with both went up dramatically during the pandemic.

ADVERTISEMENT

When it comes to car sales, at least, the needle is pointing in the other direction. The Bureau of Labor Statistics released its monthly Consumer Price Index report, and the headline CPI number (all stuff) is 0.0%, which is great and also better than the 0.1% economists were expecting. Core CPI, which excludes food and energy, was only up 0.2%, compared to 0.3% that was expected.

This isn’t a surprise. Just yesterday Cox Automotive posted the May pricing data — and, specifically, the level of new car incentives — and called car prices an “inflation buster.”

Higher incentives helped make new vehicles more affordable in May. The average new-vehicle incentive package – discounts and rebates included – last month was 6.7% of the average transaction price, according to Kelley Blue Book estimates, an increase from April and the highest level since May 2021. Incentives in May were approximately $3,200, notably higher than one year ago when discounts were measured at 4.0% of ATP.

And, sure, prices are still higher than they were before the pandemic, but the needle is moving in the right direction if you’re a consumer. Specifically, according to the CPI new vehicle prices were down 0.5% month-over-month, bringing the 12-month unadjusted down 0.8%. Used cars and trucks did bounce by 0.6% but are still down 9.3% on a 12-month basis.

On the other side of it, “transportation services” is a category that includes both vehicle leasing and things like auto repair and insurance. Auto repair and insurance prices, unfortunately, are going up, and so the “transportation services” number is up 10.5% on a 12-month basis. Here, to, is good news, as for the first time in a long time the month-over-month number dropped, by a total of 0.5%.

Will this mean rate cuts are coming? For various complex reasons not worth getting into right now, CPI is not the Federal Reserve Bank’s favorite measure of inflation. That would be PCE, or Personal Consumption Expenditures, which is a price index made up of similar stuff but weighted differently (you can read a whole thing about it here).

ADVERTISEMENT

The Fed has indicated it wants to see inflation, as measured by PCE, to come down for a while before it’ll lower rates, thus making cars even more affordable. The market this morning seems to indicate “yes” rates are coming and probably in September, but it’s hard to know for sure.

Ford CFO: We’re Worried About ‘Pink Polka Dots’

The Dodge Hornet Features A Vehicle Width Taillamp With A Center

Part of the reason why the cost of new cars is going down is that there are a lot more cars. Supply/demand, et cetera. The big Deutsche Bank 2024 Global Auto Industry Conference was yesterday and both the Chief Financial Officer of GM and Ford said interesting things.

Let’s start with Ford CFO John Lawler, via Automotive News:

“I think we’re at a point as an industry where we need to be very thoughtful about how we proceed from here and watch our production relative to supply very closely,” Lawler said at the Deutsche Bank 2024 Global Auto Industry Conference on June 11.

[…]

“It worries me that the stocks are building,” Lawler said. “One of the pitfalls you can run into, if you’re pushing product out there that isn’t necessarily what the consumer wants, it’s really tough to move. Within Ford we call those ones with pink polka dots; not specced right. It hasn’t been a contagion on us yet, we’re still seeing strength, primarily because much of our product is new.”

I love that Pink Polka Dots bit. While I would drive a car with pink polka dots, that’s not everyone. This also may explain the existence of so many Dodge Hornets.

ADVERTISEMENT

GM CFO: We Aren’t Just Going To Make EVs to Make EVs

2024 Chevrolet Equinox Ev First Drive
2024 Chevrolet Equinox EV first drive

GM has slowly been revising down its electric car plans, from 300,000 new electric cars this year, to 250,000, and, as of yesterday, that number seems to be 200,000 Ultium-based Cadillacs, Chevys, Brightdrops, and GMCs.

What’s up? Again from Automotive News:

“We don’t want to end up in a position where we give out a production target and then we just blindly produce and end up with hundreds of thousands of vehicles in inventory because the market’s just not there yet,” Jacobson said. “We think that this is a really good blend of being able to drive the scale benefits that we need but still not get crazy with inventory levels, such that we have to start engaging in deep discounting to where customers who have already bought one start to see their residual values suffer.”

Again, you don’t want to end up with too many Hornets.

At the same time, GM is going to deliver on its promised dividends according to The Detroit News:

General Motors Co. announced Tuesday its board approved a $6 billion stock repurchase authorization in an effort to continue increasing shareholder value.

“The investments GM made in its brands and product portfolio over the last several years, and the company’s operating discipline, are delivering consistently strong revenue growth, margins and free cash flow,” said Paul Jacobson, GM executive vice president and chief financial officer, in a statement. “We are very focused on the profitability of our ICE business, we’re growing and improving the profitability of our EV business and deploying our capital efficiently. This allows us to continue returning cash to shareholders.”

This isn’t a surprise, and I was critical last year of this move, pointing out that I think GM has a lot more investment to do. But it’s a strategy. Maybe the best move, in this market, is to increase the share price and wait out the EV transition by selling a lot of profitable trucks. I’m not sure it is and it highlights a big difference between China and the United States right now, as pointed out by Bloomberg‘s Joe Weisenthal this morning:

ADVERTISEMENT

Meanwhile, GM just authorized $6 billion more in stock buybacks, though there’s more to GM’s recent run. It’s doing well in bread-and-butter truck and SUV sales. GM also believes that next year, its EV business will be profitable on an operating business basis (before interest and taxes). Still, part of the story here is that EV-related investments are going to slow here, so the company can distribute more cash to shareholders (in the form of buybacks and dividends).

In US policy circles, there’s obviously a lot of anxiety about the rise of Chinese auto OEMs (hence all the tariffs). But it’s not clear whether the US legacy players can really *compete* technologically (or on cost) so long as shareholder-friendly capital allocation decisions are prioritized over a higher pace of sustained internal investment. Perhaps it’s fine. We’ll see.

I think the “perhaps” is doing a lot of work in this paragraph. I’m still skeptical.

EU Agrees To New Tariffs On Chinese EVs Based On How Much Companies Participated In EU’s Investigation

Byd Weibo
Source: BYD/ Weibo

After a lot of throat-clearing about new European tariffs on Chinese cars from both Asia and Europe, it seems like the EU’s provisional duties against Chinese companies will be based on how much the EU thinks the various brands cooperated.

In addition to the 10% tariff that already exists, Chinese automakers will get a wide range of tariffs. BYD will get a 17.4% additional tariff, Geely will get 20%, and SAIC will get a big ol’ 38.1%. Notably absent are BMW and Tesla, which apparently cooperated.

Why wouldn’t these companies cooperate? One reason might be that they’re actually benefiting from unfair subsidies, as is being suggested by the European Union.

Last month I mentioned that the French and German auto industries have slightly different views on this based on this relative to their exposure to the European and Chinese markets, with the French caring more about Europe and the Germans caring more about China.

ADVERTISEMENT

Reuters has a nice roundup of the responses and you can see how everyone feels. First, from France’s car lobby:

“… the EU market is the most open in the world. However, in the context of the historic transformation it is facing, the sector has never been more in need of a level playing field: competition, yes, but fair competition.

So, pretty happy about it.

From Germany:

“This measure further increases the risk of a global trade conflict … The potential damage that could result from the measures now announced may be greater than the potential benefits for the European – and in particular the German – automotive industry.”

Unhappy, at least performatively so.

And China:

ADVERTISEMENT

“The EU’s provisional tariffs come basically within our expectations, which won’t have much of an impact on the majority of Chinese firms.”

China is kinda meh on this, either because it’s about to strike back or because its cars are so much cheaper to build that a 20% hit doesn’t really matter to them.

What I’m Listening To This Morning While Writing TMD

This isn’t my most listened-to album, but you’d be hard-pressed to do better than anything off of “Tres Hombres” by ZZ Top.

The Big Question

What’s the best example of a pink polka dot car/trim/package on the market right now that isn’t a Dodge Hornet in any configuration?

 

ADVERTISEMENT

 

Share on facebook
Facebook
Share on whatsapp
WhatsApp
Share on twitter
Twitter
Share on linkedin
LinkedIn
Share on reddit
Reddit
Subscribe
Notify of
80 Comments
Inline Feedbacks
View all comments
Amy Andersen
Amy Andersen
29 days ago

Dodge just can’t catch a break today, huh

Myk El
Myk El
29 days ago

Good choice musically. I’ve been wondering if I should maybe consider going back to grabbing CDs on longer drives rather than go off my curated playlists. I don’t listen to albums anymore like I used to in the cassette and CD in car entertainment era. Mind you I also made lots of mix tapes.

Ottomottopean
Ottomottopean
29 days ago

I mostly just wonder how many people that tend to buy a new car every ~3 years are sitting out because they’re disgusted by the tactics the dealers have been using to inflate the prices, charging markups etc.

I used to be in that boat, buying a new car every few years. That situation makes it really easy to sit it out if you don’t need a car. I have to imagine this is a fairly big number but maybe in the grand scheme of things it’s a rounding error.

The Dude
The Dude
29 days ago
Reply to  Ottomottopean

The thought of having to deal with a dealer to buy a new car makes me want to hang onto what I have for as long as possible thanks to their COVID shenanigans.

Last edited 29 days ago by The Dude
XXLTall
XXLTall
29 days ago

The ZZ-top 6 pack box set was in a used CD store what a deal that is. Tres Hombres and the rest of the first 6 albums, such great blues rock. Yes Eliminator is great for the 80s sound and videos but early ZZ Top is best ZZ Top.

Fuzzyweis
Fuzzyweis
29 days ago

No Hornet eh? Ok then I’m a say anything that starts at about $30k but you can option for near $50k 😀

Vanillasludge
Vanillasludge
29 days ago

There’s a pink polka dot tutu with lime green fringe out there called the Volkswagen Jetta.

Take a moment to peruse the $4000+ discounts they are slapping on these old crates.

Funny enough, they probably do alright at that price since this geriatric design was selling for $15k back in 2019.

TXJeepGuy
TXJeepGuy
29 days ago

I’d say the Jeep Renegade is another pink polka dot car. Price vs what you get got way out of whack.

Joke #119!
Joke #119!
29 days ago

Fun fact: inflation drives prices up (or down), not the other way around. Inflation is caused, in the long run, by an increase in money supply. Trying to estimate inflation based on “a basket of goods” is a fool’s errand, and has been for as little over 100 years, though the US BLS has a fancy way of estimating inflation back to 1635.
As seen with vehicles, their prices are mostly based on inventory, and what manufacturers think they will sell for, not just inflation, which winds its way in via costs of building the vehicles.
Trying to control inflation, or, mainly, the appearance of inflation, is for politicians trying to keep their jobs. Meanwhile, other folks want to pump up the appearance of inflation to dive people out of office.
Yes, I have an Economics degree, but I use it only to disparage economic discussions.

Needles Balloon
Needles Balloon
29 days ago

Pink polka dot cars:
– Alfa Romeo Tonale (it’s not a configuration on the Dodge website :p)
– most Maseratis
– the Jeep Wagoneer mess (ICE, we’ll see how the EV does)
– Jeep Gladiator?
– Fiat 500X ($30k starting for an ancient subcompact crossover, when the bigger class of compact crossovers start for about the same?)
– Jeep Cherokee ($38k starting when a CR-V hybrid maxes out at $41k?)

Are you noticing a trend?

– Ford Edge ($40k for a 2-row crossover that was released 10 years ago and was refreshed 5 years ago, and is still forced to have 100% physical buttonless climate controls from a touchscreen haphazardly taped onto the dash? The refreshed Explorer starts at less than $1.5k more!)
– Nissan Murano (similar situation to the Edge but at least it has physical climate controls like you’d expect and the rare remaining V6 in the segment, at the cost of having an infamous JATCO CVT)

– Hyundai Santa Cruz (a Maverick that misses the point)

– Chevy Trailblazer FWD ($3k more for a worse Trax with a CVT?)
– Hyundai Venue (the Kia Soul is simply better and can be found with the same crappy dealerships anyways)

Last edited 29 days ago by Needles Balloon
Nsane In The MembraNe
Nsane In The MembraNe
29 days ago

The Santa Cruz was dead the moment they decided not to offer a hybrid powertrain…and even the turbo ICE Maverick offers essentially the same performance as the turbo SC with much better fuel efficiency and no recall prone DCT.

I think Hyundai thought they could compete with actual midsize trucks and they can’t. You can get a Maverick for cheaper or a base trim Colorado/Taco/etc. for about the same price as a turbo SC. The damn thing just has no place in the market…and it sucks because it was a cool enough idea, it just came out at the worst time possible.

I’ll bet if it came out 5-7 years ago it would’ve sold better. But alas…

BOSdriver
BOSdriver
29 days ago

I know I am tall but when I sat in the Santa Cruz in the showroom while my car was in for an oil change I really started to wonder how it sells at all. The rear seat is almost 911-like useless, and not just to tall me, I am guessing you have to have a family under the average height to make this feel reasonable.

Mike B
Mike B
29 days ago

The Gladiator was THE truck to have when it first came out, but much like the FJ Cruiser, it seems like anyone who really wanted one bought it within the first 2 years. The crazy price hikes don’t help either, and that goes for the Wrangler as well.

I personally really like the Gladiator, but I’d like to see more powertrain options.

Abdominal Snoman
Abdominal Snoman
29 days ago
Reply to  Mike B

IMO the biggest problem with the gladiator is when they were released the sport s trim was 33,545 and the rubicon was 43,875 but if you look now they cost 41,990 and 56,930.

TXJeepGuy
TXJeepGuy
29 days ago

Yeah. I kinda like the Gladiator after having one for a rental last summer while my Grand Cherokee was in the shop, but its not appealing without $15k in cash on the hood.

Mike B
Mike B
29 days ago
Reply to  TXJeepGuy

Yeah, I’ve seen a few 2023’s Rubicons discounted into the 40K range. I was actually very tempted, but I like not having a car payment. I think they’re a steal at 40, not so much at 60. While you give up some capability, for that price I’d get a RRaptor and have 5k left over.

TXJeepGuy
TXJeepGuy
29 days ago
Reply to  Mike B

I think the Colorado ZR2 is the best buy in that class, but the Jeep fan in me likes the Gladiator and the solid axles.

Mike B
Mike B
28 days ago
Reply to  TXJeepGuy

Agree, I think the ZR2 is a relative bargain, especially when compared to a TRD Pro Tacoma.

The Dude
The Dude
29 days ago
Reply to  Mike B

I’d argue that the Raptor is more capable if you mostly off-road in desert like environments.

Mike B
Mike B
28 days ago
Reply to  The Dude

True. Jeep has a Gladiator Mojave for that use, but I’d imagine the IFS Raptor is better for that.

I just tend to think in terms of technical trails and rock crawling, as the nearest desert is probably over a thousand miles from me.

GreatFallsGreen
GreatFallsGreen
29 days ago

I don’t know, some of those are just old and not a major enough part of their lineups to really fit the definition IMO. Cherokee’s out of production and the lineup was scaled back to a couple specific trims hence the too-high starting price, but I’d throw in the Renegade as mentioned elsewhere with the 500X, Murano, and Edge. They’re not really core models at this point, more serving as filler – to keep a brand going (Fiat) or maybe an assembly line – and they have no real replacement ready. If they were pink polka dot-ting the OEM could probably drop the line and the fraction of buyers would just move elsewhere in the lineup.

Peter d
Peter d
29 days ago

The Masers are just too damn expensive for what you get – if the Levante was priced like an X5 then they would sell a lot more. They really blew it with the Grecale – if they priced it more sanely it could have been Maserati’s 3-series – a (relatively) high-volume cash cow. Instead it is at least $15K too expensive to pull in consumers wary of the brand’s history of high maintenance costs and huge depreciation. At a minimum they should throw in 3 years of free maintenance. Now the reality is that these Grecales are likely selling for much less than sticker – but who wants to go to the hassle of dealing with that type of negotiation.

Drive By Commenter
Drive By Commenter
29 days ago

Gag, I feel like I’m turning into a Tesla stan.

With that out of the way, the Model Y seems to be way better laid out for storage than the Blazer or Equinox. No frunk, a shallower rear sub-trunk and nowhere near as many hidey-holes in the latter two.

The Blazinox does have Tesla beat for having real buttons and easily adjustable HVAC vents. They are also more conventional for looks. Not everyone wants to be driving around in an egg with a stiff upper lip.

Ahh, choices!

Nsane In The MembraNe
Nsane In The MembraNe
29 days ago

I can think of a few pink polkadot cars.

1). The Hyundai Santa Cruz

I swear I’ve only seen like 3-4 of them in the wild and every one that’s listed locally has money on the hood…which is extremely rare with Hyundais because of the gaping ass that is their dealership network. It’s unfortunate, because I think it’s a neat car.

But it’s the wrong time for it. It’s weirdly inefficient, it’s not really set up for any actual truck stuff (why the fuck does it have a wet DCT?), and the Maverick exists and is essentially better in every way.

2). Jeep Grand Cherokee 4Xe

I’ve looked at some listings out of curiosity since my wife and I will be in the market for a hybrid hauler soon, and they have as much as $15,000 on their hoods right now. There are hundreds of them. Unfortunately the PHEV setup in them is really half baked…and when you add in how optimistically priced they are at MSRP you could get into a Volvo or BMW PHEV for the same price that are…well, not half baked.

The EV range is on the low end of acceptable but in hybrid mode the engine isn’t really any more efficient than the V6. How’d they bork that so badly? A well designed PHEV should offer you fuel economy gains when being run like a traditional hybrid.

3). S650 Mustangs

I’m not sure what it is, but there are hundreds of them listed near me and every single one of them has money on the hood other than the Dark Horse, which is still being marked up. I’ve also only seen 3-4 in the wild and they’ve all been Ecoboosts.

You’d think they’d be selling well since the Camaro and Challenger are essentially zombies at this point and Ford did the right thing by keeping the V8 alive, but they don’t seem to be. I think Ford got too greedy with the pricing, packages, etc.

The thought of paying $40,000+ for a base GT doesn’t sit right with people, and it shouldn’t. They also removed the manual from the Ecoboost, which I assume is moving some potential buyers towards the Toyobaru…and the GR86 is selling very well for a coupe. I also think they nerfed the GT too much in an effort to sell the Dark Horse.

Even with the performance package the S650 GTs are not very good track cars. Hell, they’re slower than S550 GTs and are set up to be grand tourers at this point. The Dark Horse is an absolute monster, but at $70,000+ after dealerships get their hands on them? That’s M2/718/C8/ZL1/etc. money. Hell that’s solid used 911 money. Or M3/Blackwing/RS5 money if you need
more room.

And now they’re having to change course with deep discounts. Maybe don’t overprice it by 15%? Just a thought….

Last edited 29 days ago by Nsane In The MembraNe
Pupmeow
Pupmeow
29 days ago

The shittiness of Jeep’s PHEVs strikes me as Stellantis arrogance over the strength of the brand. “People will buy it because it is a Jeep, so why bother making it good?” They are inexcusably bad.

Mike B
Mike B
29 days ago

I really like the look of the Santa Cruz, but I agree with your points. It’s way too inefficient and having to get the DCT in order to get the “good” motor is a shame. Maybe if they updated it to have some actual offroad capability it might make more sense, but that would have to be on the non-DCT models.

Nsane In The MembraNe
Nsane In The MembraNe
29 days ago
Reply to  Mike B

DCTs are great in performance settings. I ripped my Kona N, which has essentially the same transmission as the SC, around the track all last weekend. In its sportiest setting it’s literally always in the power band, and when you take manual control it’s a more raw and physical experience than a torque converter.

…but for everything else they suck ass! They’re jerky at low speeds and in traffic. They’re way more complicated and require more maintenance. The performance benefits are essentially non existent below 7/10ths. There is literally no reason to have one in a car that doesn’t have any sporting ambitions.

I have no goddamn idea why Hyundai decided to put theirs in everything. I suppose maybe it’s because they invested so much into it? Or that it’s a really good sporty transmission? It’s great in the N cars but it has no business being in anything else.

Drew
Drew
29 days ago

1). The Hyundai Santa Cruz

There are several around here, and they’re something I really wanted to like. But you’re right about all the missteps. They’ve got a perfectly good hybrid system on the Tucson (and they could have gone PHEV to have something the Maverick doesn’t offer). They don’t offer compelling outdoor-oriented packages, and, like you said, why choose the wet DCT.

2). Jeep Grand Cherokee 4Xe

The discounts had me looking, too. While it’s larger than I want to go, I found it comfortable and it drove well…but how in the hell do they ask that kind of money for that kind of efficiency? Or have that large a vehicle and not stuff in enough battery for competitive electric range?

TXJeepGuy
TXJeepGuy
29 days ago
Reply to  Drew

I leased the 4XE. Its great when its all working fine but I’d get out of it tomorrow if it wasn’t worth 10k less than the payoff. Guess I’ll drive it through the lease and give it back.

Drew
Drew
29 days ago
Reply to  TXJeepGuy

Good to hear from someone who’s driving one. Sorry to hear it’s even worse than I thought. Hope your next ride is much better!

TXJeepGuy
TXJeepGuy
29 days ago
Reply to  Drew

Its not necessarily bad, just annoying how much its been in the shop the past year. I just had a job change where I’m not really getting the benefit of the hybrid/full electric mode (last year I could do my daily commute in EV) so at this point its a 19mpg SUV for me. Theres a lot more fun cars I could drive at 19mpg.

GreatFallsGreen
GreatFallsGreen
29 days ago
Reply to  Drew

I see several SCs around too. I like the SC more than the Maverick in comparable specs but that’s a very narrow window given how much more variety Ford offers and despite the price hikes, and that’s more in the upper $30s where they have actual overlap and neither one is a strong new buy at that price.

I don’t think Hyundai is really committed to it being a volume model the way Ford is with the Maverick, so I get the sense they’re probably just going to let it ride and it might have some updates trickle down like Honda does with the Ridgeline. But even Honda has sudden renewed interest in the Ridgeline and last year was its best-ever sales year. (But then, Honda seems to be putting more effort behind the Passport as that’s about to be redesigned.)

Swedish Jeep
Swedish Jeep
29 days ago
Reply to  Drew

I had a 4xe for 3 weeks as a service loaner. I loved it, but I wouldn’t pay XC90 money for it (my wife has an XC90). But whats crazy is that it puts up near TrackHawk torque numbers. Fun to drive but when you can get a regular Cherokee that looks nicer for 44k, why pay 60+ for a few miles of electric and A lot more torque.

Swedish Jeep
Swedish Jeep
29 days ago

I don’t know if this applies everywhere but all the V6 Challengers and Chargers here in Houston are selling for 24k fully loaded (leather, Stereo, Nav….). That’s almost buy one for your kid money, less than a Maverick and less than many used cars. Supply and Demand…

Nsane In The MembraNe
Nsane In The MembraNe
29 days ago
Reply to  Swedish Jeep

Weirdly enough the Chargers/Challengers I see being driven recklessly the most are the V6 ones. They’re big, heavy, and slow but a drivers with bad intentions seem to find a way to turn them into 4,000 pound missiles here in DC.

Root
Root
29 days ago

I’m curious about the comment about the 4xe being half-baked. I’ve been kinda looking at them as a replacement for my X5 PHEV because I want another PHEV SUV but I don’t want to spend $80k on a new X5 right now. The GC 4xe seems like a relative bargain, especially with some of the discounts available. I haven’t driven one yet, but I’ve looked up a few reviews and they generally seem positive. Is it more of a reliability issue? (because Stellantis)?

Nsane In The MembraNe
Nsane In The MembraNe
29 days ago
Reply to  Root

Reliability and the fact that they don’t get any better fuel economy than the V6 when operating as a hybrid. It takes some real Stellantis bullshit to engineer a plug in hybrid system that does absolutely nothing to improve gas mileage lol. PHEVs aren’t usually as efficient as traditional hybrids when running as hybrids but there’s really no reason at all why they shouldn’t improve fuel economy.

Root
Root
29 days ago

Oh, that’s a good point. Although in my use case I’d be doing most of the miles in EV mode, so the hybrid MPG isn’t as important. Interestingly, I recently watched a video from “Alex on Autos” where he explains that the way Stellantis has chosen to calculate MPG is apparently different than a lot of other automakers, so I’m wondering if they’re kinda under-selling the efficiency in order to avoid being sued? Or ??? It sounds like the PHEV provides a lot more performance than the V6. (And to be fair, BMW does the same thing with the X5 – the hybrid doesn’t really make it more efficient, mostly gives more performance.)

If I did go with a GC, I would lease it so I’m not stuck with reliability issues.

Alexk98
Alexk98
29 days ago

GM CFO: We Aren’t Just Going To Make EVs to Make EVs

Meanwhile, the Blazer EV exists, completely contradicting this statement. It also is the essence of a Pink Polka-Dot car. A vehicle so far removed from it’s nameplates heritage, and does not seem compelling at all unless you read the blatantly paid for Motor Trend “Articles” (ads) or can get 15%+ off MSRP.

Alexk98
Alexk98
29 days ago
Reply to  Alexk98

Seriously though, the Blazer EV is 7k more expensive than the Model Y, has the same range per trim, but is about 5% less efficient, charges slower, and has already proven to be a mess given the stop sales. For a brand new model to compete with the Model Y that’s been on sale for years, the complete lack of superlatives and innovation is pathetic.

While the Model Y may not be getting an update this calendar year, the second it gets one early 2025 the Blazer EV will be completely dead in the water. I’m hardly a Tesla fan by any stretch of the imagination, but the Model Y is already more compelling, and a price cut or update will make that segment a bloodbath.

Drew
Drew
29 days ago
Reply to  Alexk98

And the Equinox EV gives you almost the same dimensions (a little less rear legroom and a little more storage behind the rear seats) and around the same range for less money. You basically just give up a screen in the rearview mirror, folding mirrors, a wireless charging pad, and overly aggressive styling.

Harvey Firebirdman
Harvey Firebirdman
29 days ago
Reply to  Drew

But I want a stupid electric motor controlled charging door that doesn’t opened in winter and you know will break in the future and be stuck open or closed. So haha sucks to sucks if you park outside in the winter and want to charge.

Drew
Drew
29 days ago

Yeah, of the missing “features,” the only one I would miss is power-folding mirrors. I forgot about that stupid motorized charging door. I don’t want a worse mirror that can also display the rear camera. I don’t need a wireless charging pad (I turned the one in my current car off). And I don’t need aggressive styling that makes the vehicle wider without adding any interior space.

The only thing the Blazer has that I would want is normal door handles. The Equinox has those pop-out ones that are on so many EVs.

Harvey Firebirdman
Harvey Firebirdman
29 days ago
Reply to  Drew

Yeah I really really hate those stupid flush door handles and again it is the haha sucks to suck to live where it snows situation. Like why yes car manufacture I want to be locked out of my vehicle when it is freezing and iced over.

Fuzzyweis
Fuzzyweis
29 days ago

Lol, just imagining Blazer EVs in 10 years with stuck charging doors driving around like 80s cars with pop-up headlights that are stuck.

Harvey Firebirdman
Harvey Firebirdman
29 days ago
Reply to  Fuzzyweis

Hey I had that issue with my firebird haha. Thanks GM for building the gears in the headlight motors out of plastic they would either be stuck up or down when they went.

Alexk98
Alexk98
29 days ago
Reply to  Drew

It really is staggering to me. This is genuinely a copy-paste repeat of the sales/marketing disaster that happened with the ICE Blazer just preceding it. No practical differentiation between is own stablemates and competitors, but EdGiEr StYLiNg and a wildly inflated price tag. As always seems to be the case with GM, they just make incomprehensible nonsense, don’t even remotely market it, and wonder why nobody buys it, with a dash of quality issues thrown in for good measure.

Weddings/Birthdays/Whale Breachings
Weddings/Birthdays/Whale Breachings
29 days ago
Reply to  Alexk98

They had to build something new for a hedge on compliance requirements. The fact that the product is lukewarm Mueslix milk is irrelevant.

Alexk98
Alexk98
29 days ago

My argument is more that they decided to build the wrong products. A second Generation Bolt on the Ultium platform would sell leaps and bounds better than a Blazer EV would, which would help out their CAFE spread even more, as well as get higher volumes out the door. Instead they decided to build two vehicles (Equinox and Blazer EVs) that are occupying a very similar space, with similar use cases, but at very different price points without enough to differentiate the Blazer EV to make it worthwhile. It’s just a classic case of GM misjudging the direction of the market and consumers.

Weddings/Birthdays/Whale Breachings
Weddings/Birthdays/Whale Breachings
29 days ago
Reply to  Alexk98

I agree that on the consumer level of preference, they may have built the wrong cars. Maybe. However, the reality on that level is that they played it safe by looking at the sales numbers of “X”UVs vs. tiny cars, and the net profit (read: less losses) per unit.

The reality is that since the 50’s, GM has been run less like a true car company and more like a profit driven manufacturing company. What widget they make isn’t really the point. Other than a few halo cars, the rest of all their products have always been “good enough” to garner enough sales to turn a profit, and that’s the true goal. They may toss in a bit of spicy innovation, like Supercruise (lately) or the meteoroholi-whatever suspension in Caddys and Vettes to show they can do shit when needed, but that’s mostly just proof of concept stuff.

GM runs on their creative tax/accounting strategies here and globally. They really fucked up when they went away from the bread and butter by doing all that GMAC real estate lending and got 3rd degree burns. Lesson (mostly) learned.

End of the day, GM isn’t run to please the consumer’s desires, it’s run to be effective at its core mission. Revenue. As incoherent as it seems at times.

Alexk98
Alexk98
29 days ago

That’s a very fair point and argument. I guess what I interpret it as, at least recently, is GM is really going at chasing whatever buzzword is getting loads of Venture Capital as a way to drum up good press and hopefully (yet somehow never) spike the stock price. Everyone seems to forget, but pre-pandemic times circa 2018 GM was throwing serious weight behind V2X and smart infrastructure, but silently abandoned it when EVs (Ultium), Autonomy (Cruise), and AI became the new big buzz words with more funding.

I struggle to believe a single word when GM claims to care about a given initiative or product line that is less than 5 years old given how easily their C-Suite seems to be swayed be the winds of the stock market and social media buzz.

Weddings/Birthdays/Whale Breachings
Weddings/Birthdays/Whale Breachings
29 days ago
Reply to  Alexk98

Have you seen the stock price YTD?

General Motors Company
As of June 12, 2024 • 1:50 PM EDT
NYSE: GM
48.805USD+12.755(35.38%)

They are accomplishing their mission lately, all the while managing to play nice with the Federal “mandates” as to wherever the wind blows there.

Again, they are doing “enough”, not necessarily the best, because they don’t need to. They have the cash to buy back stock and give a nice dividend, all the while pumping out four tires of something. Goal achieved.

Don’t get me wrong, I am right with you in being frustrated a bit by them, but it’s a “nothing I can do about it” thing. I’ll always be a Caddy guy, either way. As incoherent as it seems at times. lol

Alexk98
Alexk98
29 days ago

That’s true, but the stock is only up the same amount (within a few percent) relative to when Mary Barra took over as CEO a full 10 years ago, and I’d be a lot more annoyed at such a poor amount of growth over that period, which was more what I was basing my argument on.

All that said, they clearly are doing well right now with such large buybacks and are getting by regulation shifts shockingly well compared to what they ever could have done 15-20 years ago.

It just bugs me seeing one of Americas companies with some of the most fascinating history chase trends for stock gains like an Instagram Influencer chasing clout

Weddings/Birthdays/Whale Breachings
Weddings/Birthdays/Whale Breachings
29 days ago
Reply to  Alexk98

I’m not arguing with you, I promise! But, you are kinda wrong on your last point that you are stuck on. They aren’t chasing anything, GM is that Steve Buscemi meme of him with the skateboard, just staying in the loop of what’s going on. GM isn’t trying to be the Prom King, that’s for the pretty kids like Ferrari and that bitch Porsche. They just wanna know whose house the party is at and what kinda keg they are getting, even though they wouldn’t ever go. Meanwhile, they are more comfortable at the chess club, and getting a “B-” in CAD class. A true jack of all trades and master of none.

This just occurred to me, but for all intents and purposes, GM is basically Mark Cuban.

Weddings/Birthdays/Whale Breachings
Weddings/Birthdays/Whale Breachings
29 days ago
Reply to  Alexk98

Also, looking deeper at the stock price, it’s up about 17% since Jan 2014. Not great, but incremental gains are gains, plus a middle of the road dividend, which is on brand for them.

More important to note is that when covid hit in 3/2020, it bottomed out at 14.33. That’s a 70.6% increase in 4 years, which is nothing less than an outstanding turnaround, considering how much the automotive landscape (particularly in loss-leading EV investment) has changed in that time. Just saying.

Weddings/Birthdays/Whale Breachings
Weddings/Birthdays/Whale Breachings
29 days ago

I don’t understand any surprise about GM revising its EV production downward. Mary Barra has been consistently saying this for the last year and a half. Sure, it was more of implied statements and vague allusions to it, so as not to scare off any “green” money, but she’s been steady as a rock about it. GM isn’t all-in, and won’t be, until the stakes change in their favor. Basically they moved to the $5 blackjack table, pocketing chips off the occasional 21, until the high roller table opens up, and they have enough in their satchel to last 200 antes and try to double down on a split for a big win.

Harvey Firebirdman
Harvey Firebirdman
29 days ago

I really wonder how this will affect the battery plant they are building in Indiana not to far from my current job? It is weird though because Amazon is building a $11 billion dollar data center right next to it and now Microsoft a few weeks ago announced they are building a $1 billion dollar data center in the same general area also. So I guess if EV’s don’t work out for GM the land could be sold for more data centers yay?

Weddings/Birthdays/Whale Breachings
Weddings/Birthdays/Whale Breachings
29 days ago

They’ll still build it, if for nothing else than the money is already allocated and isn’t that much for them in the big picture. GM will be ready to go when the time is right. They’re just playing a little game called “Just The Tip”, for now.

Harvey Firebirdman
Harvey Firebirdman
29 days ago

True yeah they are still chugging along building it here was just wondering if this would affect the future of the plant needing less employees when it is up and running and only needing more if/when EV’s pick up steam again. I know there are concerns where I work many people will jump ship to go work there as it is a kind of bufu area and going to be really hard to find technical and mechanical type people in the area.

Weddings/Birthdays/Whale Breachings
Weddings/Birthdays/Whale Breachings
29 days ago

They can always contract out some of the manufacturing, like what they did building ventilators during covid. One way or the other, it’s not gonna sit totally idle.

Ranwhenparked
Ranwhenparked
29 days ago

This is going to hurt SAIC pretty badly, MG sold 240,000 cars in the EU last year, and like most automakers, is moving toward a full EV model line by the end of the decade, EVs are already the majority of their volume in Europe

Vic Vinegar
Vic Vinegar
1 month ago

My local dealer is advertising up to $18k off Grand Cherokee 4xe’s. $68k – $50k.

Times must be pretty rough over at the CDJR dealer.

Meanwhile the Toyota hybrids are still being marked up.

Think I’ll put on Tres Hombres myself here for a work soundtrack.

Ben Siegel
Ben Siegel
29 days ago
Reply to  Vic Vinegar

Gotta be careful with the fine print on those – some dealers are advertising a total price that “includes $7,500 off, if you lease, so it’s a lease total price, not the lease, etc”.

Vic Vinegar
Vic Vinegar
29 days ago
Reply to  Ben Siegel

Sure, with any dealer you can’t trust their “deal” until you actually have your money to hand over and get keys in return.

Pupmeow
Pupmeow
1 month ago

And to answer the question: The Jeep (Grand) Wagoneer.

Rippstik
Rippstik
1 month ago

Jeep Grand Wagoneer. It’s a bit of a tough sell from what I understand.

Another example might be the Ford Escape. The Bronco Sport and Maverick are more compelling products for similar money.

Pupmeow
Pupmeow
1 month ago

BYD will get a 17.4% additional tariff, Geely will get 20%, and SAIC will get a big ol’ 38.1%. Notably absent are BYD and Tesla, which apparently cooperated.

Is there an error in here? I’m confused about the statement that BYD gets an additional tariff, followed by a statement that they are “absent.”

Ranwhenparked
Ranwhenparked
1 month ago
Reply to  Pupmeow

I think the second BYD is supposed to be BMW, BMW and Tesla are the two biggest non-Chinese companies selling Chinese built EVs in Europe at the moment

David Tracy
David Tracy
1 month ago
Reply to  Pupmeow

Err, BMW!

Thanks for pointing that out. I was on the phone with Fred Williams talking about flat-fender Jeeps as I was editing, and, well…That’s on me!

Camp Fire
Camp Fire
29 days ago
Reply to  David Tracy

So…Fixing Flat Fenders with Fred?

Please tell me that’s your new upcoming series. It sounds like a winner.

Last edited 29 days ago by Camp Fire
Pupmeow
Pupmeow
29 days ago
Reply to  David Tracy

thanks!

Waremon0
Waremon0
29 days ago
Reply to  David Tracy

David doesn’t know any 2000s pop culture because, like me, he was watching too much Extreme4x4 and reading Petersons mags.

Harvey Firebirdman
Harvey Firebirdman
1 month ago

I was going to say the civic type r or the Corolla gr they are 40k+ but I wouldn’t say they are cars people don’t want they are just damn expensive for what they are.

Arch Duke Maxyenko
Arch Duke Maxyenko
1 month ago

The Toyota Mirai is THE Pink Polka Dot car

Harvey Firebirdman
Harvey Firebirdman
1 month ago

Yeah I just looked up the MSRP for the Mirai 50k for the base that is crazy and cannot think of anywhere you can get hydrogen outside of Cali and even there your choices are limited. Also what is the price of hydrogen compared to electric and gas?

RidesBicyclesButLovesCars
RidesBicyclesButLovesCars
29 days ago

With current prices, hydrogen is one of the most expensive ways to power a car. That’s one of the reasons Toyota was giving buyers of the Mirai credits towards hydrogen refueling.

If you venture over to YouTube, search for Donut Media and their experience with the Mirai, they break down some of the costs and current refueling hassles.

Harvey Firebirdman
Harvey Firebirdman
29 days ago

Cool I’ll have to check that out normally don’t watch much car YouTube channels as most seem to be a bit to show boaty.

Vic Vinegar
Vic Vinegar
29 days ago

How many are actually for sale? 2? I can’t imagine Toyota thinks these things are going to take off any day now.

Hell, they aren’t even an option in the Toyota inventory search tool.

Last edited 29 days ago by Vic Vinegar
3WiperB
3WiperB
29 days ago

Especially the used ones that don’t have free fuel anymore.

80
0
Would love your thoughts, please comment.x
()
x