When the average car still on American roads today left the dealership, you couldn’t go very far without hearing “Rolling in the Deep” playing on someone’s stereo. I’m not saying that song’s not a banger—it is, certifiably—but it’s been a while since it was a fresh jam. But the cars from that time still keep putting in the work today; a new study shows Americans have hit a record average high with vehicle ownership. Can you blame us?
We have that trend for today’s morning roundup, plus more news about VinFast and where Alfa Romeo is hinging its comeback plans. Happy Monday; let’s get started.
The Cars Are Getting Old
If you drive a Ford F-150, Toyota Camry, Chevy Silverado or Nissan Altima from 2010 or 2011, congratulations: you’re basically driving the average car on American roads today. S&P Global Mobility released another study that shows how old today’s cars are, and according to them, it’s 12.5 years — up from 12.2 years in 2022.
Here’s a handy chart from those folks that shows just how much cars on the road have aged in the past two decades:
You can see where things started to level off in the years after the Great Recession and the auto industry’s (in some cases, state-funded) recovery, wherein car buyers found relief from pent-up demand. But now people are keeping their cars on the road longer than ever; especially passenger cars, which are spending a whopping 13.6 years in service, on average.
Is anyone surprised by this? Modern cars are safer, faster, more reliable, better built and more efficient than at any other point in history. Sure, some brands and vehicle types hold their long-term quality better than others and there are still a few maintenance disasters out there. But on the whole, if you buy a car today (or in 2010, apparently) and take care of it, you can keep it running for a very long time.
Couple those technology improvements with the fact that new cars are staggeringly expensive, a trend we’ve been covering extensively here at The Autopian. Rising interest rates, longest-ever loan terms, an uncertain economy ahead, a market-wide shift to trucks and SUVs and still-pricey electric vehicles all mean more and more people are saying “Yeah, this is fine for now” when they think about their aging cars. When the average new car price is trending toward $50,000, that old Altima seems quite appealing.
As Axios notes today, even if we’re on the eve of what appears to be an eventually all-electric new car market—something I too believe, with emphasis on “eventually”—this data proves gasoline cars aren’t going anywhere for a while. And I don’t even mean new cars. I mean the ones on the road now. Those vehicles will all be creating emissions for decades to come, which is worrisome from a climate perspective.
Then again, what the hell are people supposed to do, right? Automakers are kind of banking on super-high transaction prices to help bankroll the EV transition, but not every American driver wants to—or even can—help them pay that tab. New cars have gotten so outrageously expensive that many of us have no choice but to keep our older vehicles running until they simply cannot anymore.
VinFast Tries For A VinSPAC
In the decade I’ve been covering the auto industry, I honestly can’t remember a new car launch as universally despised by reviewers as the VinFast VF8. Our take was “Just don’t;” others said “Simply Unacceptable,” “Return To Sender,” or simply “Yikes.” It’s like that one review of a Spinal Tap album that was just “shit sandwich.” This was the kind of revilement that happened to cars like the Yugo, way back in the day.
To be fair, a VinFast VF8 is a better car than a Yugo is. (I think.) But as we see with the above data, today’s cars have gotten much better than they were in decades past. Even if VinFast put in a noble effort as a brand new car from a new company and a country relatively new to automating, it’s simply not enough to cut it right now. And I’m not sure if American buyers will give it the patience they once gave newcomers like Volkswagen, Toyota and Hyundai, especially since those brands used to represent a super-cheap value proposition; the $50,000 VF8 certainly does not.
(Side note: What if this car had been like, $24,000? I think that would’ve changed a lot of people’s tunes.)
But capitalism gonna capitalism. And so VinFast is now a publicly traded company in the U.S., doing so via a SPAC, or special purpose acquisition company. (This piece I ran at The Drive two years ago explains how they work.) SPACs had a big moment in 2020 and 2021, but the vast majority of them fizzled out hard and they’ve since become something of a joke on Wall Street.
Bloomberg’s here to explain why this SPAC is also a dicey one, which is fitting for VinFast:
The purported $27 billion valuation (which includes debt) would make it the third-largest such transaction in history.
However, the merger of VinFast Auto Pte. Ltd. with Hong Kong-based Black Spade Acquisition Co. announced Friday feels more like an act of desperation than a revival of a maligned asset class. The transaction won’t raise much money and the purported valuation looks as rocky as VinFast’s US vehicles.
[…] VinFast filed for a regular US initial public offering in December, but last week announced it would go public via the SPAC route, without explaining its change of heart. Of course it’s hard for anyone to do an IPO at the moment, but the company’s recent news hasn’t been encouraging: Its initial US vehicle deliveries were delayed, it cut part of its US workforce and it tapped Vuong and related entities for $2.5 billion.
It’s normal to be skeptical of the long-term prospects of EV startups. Tesla’s the standard bearer but it took the vast majority of its 20 years in existence to get to a stable, profitable stage. But even troubled companies like Lucid and Rivian have promising, cutting-edge products; based on everything so far we cannot say the same about VinFast.
What it does have is Vietnamese billionaire founder Pham Nhat Vuong, but even he’s not going to waste his fortune on cars forever if they don’t pan out.
The Tonale To Be A Shot In The Arm For Alfa Romeo
Alfa Romeo’s another one of those “What the hell happened?” brands. A decade ago, it announced aggressive product plans with an Italian BMW-esque full lineup and hinged its hopes on a big relaunch in America. None of that stuff panned out. The Giulia sedan got a lot of early hype, especially in Quadrifoglio form, but it came out just in time for everyone to pivot to buying SUVs. The Stelvio’s launch took too long to happen, and the 4C was never meant to be a volume seller. After years of hype in the 2010s, it all just fizzled out. Fiat Chrysler’s transformation into Stellantis probably didn’t help much either.
So now, all hopes ride on the Tonale: a compact crossover with an un-Alfa-like plug-in hybrid 1.3-liter turbo four and a starting price around $45,000. I haven’t driven one yet but apparently, it’s fine.
What you can expect is a big marketing blitz in America, according to Automotive News:
[…] The next focuses on enticing new customers. Alfa Romeo formulated a profile of potential buyers that it dubs “Sydney.” Sydney is a 35-year-old man or woman, making around $135,000 per year, unmarried but in a committed relationship, and living in a thriving metro area. This person has a passion for the arts, culture and the health of the planet, Goldstein said.
Alfa’s mostly hoping for younger, professional women buyers on this one, but even it admits it’s playing in an unfamiliar space with a compact hybrid crossover. My advice to Alfa is to make sure they have the reliability dialed in this time. That didn’t help the Guilia and Stelvio’s prospects at all a few years ago.
Can Tesla Hit Reset On Car Manufacturing?
The next big thing to watch out of Tesla may not be new car models (though I maintain it desperately needs those too) but how cars are made entirely. All eyes are on the “unboxed” manufacturing process Elon Musk announced at the Phase 3 event earlier this year, reports Reuters. It basically means breaking the car up into subassemblies and then putting them together down the line, which is said to be key to Tesla’s sub-Model 3 pricing goals. (I found a good explainer here and I hope we’ll dive more into this later.)
Here’s Reuters on why this could be a big deal, potentially:
Officials said the unboxed process could cut production costs in half and reduce the factory footprint by 40%. The aim, said the company, is to “build more vehicles at lower cost.”
The assemblage of new techniques will not be fully tested until the system is installed in late 2024 at Tesla’s new $5 billion plant in Monterrey, Mexico, where the company plans to build a new generation of sub-$30,000 EVs.
[…] Martin French, managing director at consulting firm Berylls which focuses on the industry’s rapid shift to electric and smart mobility, wondered if Tesla’s move might supplant decades-old lean manufacturing methods pioneered by industry kingpin Toyota Motor Corp (7203.T).
“I got the feeling when I watched the Tesla (presentation) that the Toyota Production System handbook has just been thrown up in the air and machine-gunned down,” French said.
German researcher Jan-Philipp Büchler of the Free University of Dortmund, believes Tesla’s new process is “revolutionary,” adding: “This is much more than modular production … It’s eliminating steps that were standard, creating new patterns of working, increasing speed, reducing complexity.”
It could change how cars are made globally. But other experts say it depends on exact synchronization, which Toyota mastered with its Just In Time system, and it may be ill-suited to making different sizes and types of cars instead of just one.
What’s the longest you’ve ever kept a car you’ve owned? My first car was a Toyota Corolla (not exciting, but it got the job done, no questions asked) and I had it for eight years before trading it for a Subaru WRX because I was young and got a real job and wanted to go fast.
My current daily driver is a 2018 Mazda 3 hatchback. I just put 50,000 miles on it and it’s in stellar shape. It’s also completely paid off. I am not getting rid of that anytime soon, even if my next “new” car is an EV or a PHEV. Count my Mazda in that S&P Global study in about 10 years.
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I kept an Elise for 8 years, and it was 14 years old when I sold it.
Current cars are 6 and 16 years old, so I guess that averages to 11 years old.
Next car is likely to be brand new, but could end up being lightly used depending on what I get.
car I’ve owned the longest, 1998 Sienna we owned from 2002 until 2017.
All four cars in the family now are much older than that average – 20 years for the WRX, 19 for my Sport Trac, 17 for MDX, 14 for the Honda Fit.
I expect the Honda to go another six to ten; the MDX should last another eight except my wife is bored with it; the Sport Trac is running fine while the rust is eating it up from inside, was hoping for another four or five years but signs point to no; the WRX has a new transmission and son is hoping to take it through medical school, another five at least.
Welp, at least I’m at least average at something. The Lancer turns 13 this year.
It replaced an old Altima, which was such a gigantic pile of turds that my parents got me my “graduation present”—a working vehicle that didn’t overheat all the time—early. An old Altima is never appealing and I will die on that hill…comfortably, in my old Lancer that still runs fine.
Longest so far for me is 23 years and counting (’96 Subaru Legacy). I buy cars with no intention of ever selling them. So at age 54, I’ve only owned four cars (one wrecked – my fault, another wrecked – caribou’s fault) of which I still have two.
There’s a car out there called the Alpha Toenail? Mr. Tarantino, it’s time to trade in the Kia Sole.
> My advice to Alfa is to make sure they have the reliability dialed in this time.
I tend to keep cars for multiple years because I get sentimentally attached to them, and I fear change.
I currently have a 2016 Mazda6 that I bought new in October of 2015. It has been paid off since September of 2019, and it only has 72,500 miles. So, no plans to get rid of it anytime soon as it still suits my needs incredibly well and is very reliable and efficient.
We experimented with a new/fancy car pre-Covid and realized during the pandemic what a financial mistake that was. So, we dumped it during the used car market swing and made a profit. Now, my wife has a 2016 Mazda CX-5 that is also due to be paid off within a few weeks. It has a bit more miles on it (just hit 94,000 this weekend) but is still relatively problem free. All I’ve had to do to it so far is brakes. Helps that the previous owners appear to have maintained it well.
Both cars will be sticking around for a long time as anything comparable to replace them would require an asinine car loan with payments every month that we just can’t and don’t want to do right now.
Currently longest owned:
2005 Dodge ram 3/4 ton diesel quad cab long bed. Bought new. 5.9 and before DPF or EGR or SCR or urea injection. Still in great shape, no rust, fairly low miles since it’s never been a daily driver. I’ll probably keep it for a long time more because new trucks are stupid expensive and I only use it to tow and haul.
Ain’t buying something new anytime soon.
> But like the tranny beer drinker
Hey, fuck off with that language.
Yeah like, holy shit a beer company printed like 12 cans for an influencer and the entire chudosphere has been frothing like they were bitten by a radioactive Tucker Carlson.
I don’t simp for corporations, nor do I enjoy Bud Light, but it was a cute gesture and regardless of marketing motivations it helped validate her.
People can’t afford new cars anymore, stuck buying used. And thanks to gouging, the cheaper new cars don’t exist anymore 🙁