‘It Will Take Years’ For Used Cars Prices To Reach Pre-Pandemic Levels


On today’s Morning Dump we’ve got BYD up 350%, used car prices down 1%, EU carbon emissions down 55%, and BMW’s H dreams up 1,000%.

Welcome to The Morning Dump, bite-sized stories corralled into a single article for your morning perusal. If your morning coffee’s working a little too well, pull up a throne and have a gander at the best of the rest of yesterday.

Prices Are Down 1% Off Of Their Highs But…


Most experts are saying used car prices are coming down, with Manheim saying wholesale prices are down 0.1% year-over-year and Edmunds showing a 1% decrease off their May highs, according to this story from the Associated Press. That’s all well-and-good, but what if you need a car now?

From the same AP story:

Ivan Drury, director of insights at Edmunds cautioned that it will take years for used prices to fall close to their pre-pandemic levels. Since 2020, automakers haven’t been leasing as many cars, thereby choking off one key source of late-model used vehicles.

Similarly, rental companies haven’t been able to buy many new vehicles. So eventually, they are selling fewer autos into the used market. That’s crimped another source of vehicles. And because used cars aren’t sitting long on dealer lots, demand remains strong enough to prop up prices.

It’s so bad that people are out here trying to salvage Chevy HHRs even if it kills them. It’s worth noting that there are still decent options for people who want something cheap, as we discussed with Kevin Williams on our latest podcast.

BYD Saw A 350% Increase In Q3 Profits


Q3 numbers have been mixed as no two automakers have had identical reactions to two years of supply chain disruptions, inflation, fed-rate adjustments, and the latest season of Great British Bake Off. It’s rough out there. Unless you’re BYD.

The company’s Q3 report is out and, per Reuters, BYD made $789 million, up 350% from a year ago. That’s not just a fluke, profits are up 281% for the first nine months.

How’d BYD do this? Well, it’s now the biggest EV company in all of China and they’ve been spanking Tesla lately. As the South China Morning Post points out, this is at least partially due to their pricing strategy:

“BYD’s cars have become increasingly popular in China because more low- and middle-income drivers are opting for EVs,” said Tian Maowei, a sales manager at Yiyou Auto Service in Shanghai. “The customer base is huge in China, and BYD vehicles are turning out to be dominant in the segment.”

Unlike Tesla and its Chinese rivals – smart EV builders like Nio and Xpeng – which assemble and sell premium cars priced above 300,000 yuan, most of BYD’s models are priced between 100,000 yuan and 200,000 yuan.
This has led to them selling 538,704 pure EVs in just the last quarter! By comparison, Ford has sold 28,089 Mach Es… since January. BYD has come an awful long way since the crazy test drive I took with chairman Wang Chaunfu while covering the Detroit Auto Show for the old lighting site.

BMW Is Still About That H, ‘Bout That H, ‘Bout That H, NO Hybrid

Bmw Hyrdogen

I continue to be skeptical about hydrogen in regular passenger cars, though I’ll be happy to be wrong about their prospects. Certainly there are real possibilities for trucking and aviation, but it’s not where would be as an automaker. BMW, though, is still super into it.

Our pal Hannah Elliott at Bloomberg chatted with BMW’s chairman Oliver Zipse at Goodwood and he doubled down on hydrogen:

“After the electric car, which has been going on for about 10 years and scaling up rapidly, the next trend will be hydrogen,” he says. “When it’s more scalable, hydrogen will be the hippest thing to drive.”

Hippest? ORLY? He continued:

“To say in the UK about 2030 or the UK and in Europe in 2035, there’s only one drivetrain, that is a dangerous thing,” he says. “For the customers, for the industry, for employment, for the climate, from every angle you look at, that is a dangerous path to go to.”

I definitely buy the argument that being wholly dependent on one type of drivetrain creates problems (much like Germany being addicted to Russian gas) but I’m not sure that hydrogen is going to do better than hybrids.

EU Bans New Combustion Cars From 2035 But F’Real This Time

Eu Parl

It seems that the EU has maybe overcome Germany’s intransigence over a full-gas ban by 2035, if I’m reading this Bloomberg article on Automotive News story correctly. Germany was going to reject the move, but I guess they’re not, now? The deal pushes for 0% emissions by 2035 and a 55% drop by 2030 compared to 2021 levels.

Oh, hey, it’s good ol’ Oliver Zipse again:

“We are now keen to see the framework conditions which are essential to meet this target reflected in EU policies,” said Oliver Zipse, president of ACEA, the European automakers lobby group and CEO of BMW.

“These include an abundance of renewable energy, a seamless private and public charging infrastructure network, and access to raw materials,” Zipse said.

Sure. I think the “framework conditions” might include a lot of money to subsidize hydrogen? Just a guess. My favorite part of the article is this:

“With today’s agreement, a ‘Havana effect’ is becoming more realistic,” Jens Gieseke, a lawmaker and negotiator from the conservative European People’s Party, said in a statement. “After 2035, our streets might become full of vintage cars, because new cars are not available or not affordable. Today’s deal slammed shut the door to new technological developments and put all the eggs in one basket. This is a mistake.”

Don’t threaten us with a good time! It’s a fair point, with car prices staying high for a while, but electric cars also work and the issue isn’t so much the vehicles as the consistent source of power for them.

The Flush

It’s pretty obvious by now to some that Bloomberg Opinion contributor Matt Levine’s style is highly influential on what I’ve been doing here. It’s good! Read him! In particularly, I’m slowly working my way through his 40,000-word epic on crypto currency. It makes me wonder: Do you expect to ever buy or sell a car using crpyto? Have you? Do you have any BTC or ETH?

Photos: Nissan, Chrysler, BYD, BMW, EU Commission

Share on facebook
Share on whatsapp
Share on twitter
Share on linkedin
Share on reddit

34 Responses

  1. I guess the EU is assuming that this thing with Russia and natural gas is going to be long over and back to well, “better than normal” by 2035.


    Either that or they are going to change their tune on Nuclear Power and build a bunch of reactors between now and 2035. If that’s the plan they had better get started PDQ. A dozen years to design, site, construct, and get a new reactor up to full speed is just enough.

    1. The report is missing out that France which I think takes 70% of its power from nuclear has had to shut down two nuclear plants as they found cracks in the cooling towers. That has been contributing to the problem as France is one of the few EU countries that is a net energy exporter normally.

  2. “Do you expect to ever buy or sell a car using crpyto? Have you? Do you have any BTC or ETH?”
    No, no, and no. While proof-of-stake has assuaged environmental concerns somewhat, the idea of replacing fiat currency with arbitrarily limited digital currency doesn’t really impress me. Especially when the currency is promoted as a speculative investment. The goal of currency should be relative stability, not massive fluctuation. I know people who made a bunch of money on crypto, but even they are cautious on it right now.

  3. I had 30 bitcoin and sold them for $30 each back in the day to pay for my wife’s engagement ring.

    As painful as that sounds, consider that a week after I cashed out the coins from MtGox, it was hacked and I would have lost everything.

    So now she has a multi-million dollar ring and a fun story.

  4. The last time I ran the numbers, the US is down ~8 million new car sales from 2020 to now. That will have a lasting impact unless the economy craters like it did during the great depression.

    My car was worth $19k trade-in in late 2019. It was worth $26k trade-in at the peak. It is worth between $21k and $23k trade-in now. Dealers appear to be buying cars for less but still advertising them for the higher prices. I expect within 12-18 months my car will be worth $19k trade-in again.

    Hydrogen powered cars have been five years away for the last 20 years. I don’t expect that to change much for the next 10 years.

    My co-workers and I were talking about what it would take for mass EV adoption to be successful. Think about a person who knows nothing about cars. A person who only knows to add fuel or do any maintenance/repairs when a light comes on. Now put them in an EV today. Until the charging networks get to the point where we don’t need to think about charging until a light turns on, those people will fail.

    1. Counterpoint, that’s not how it worked in my family. My wife is one of those people, with a healthy dose of “that light’s a scam. What does a stupid car know?” She thought for years that running out of gas on the side of the road was just something that happened to everybody a few times a year. I have no explanation. I also have no explanation for how a 1st gen EV with a range of 80 miles on a warm day cured her, but it did. There was something psychological about home charging, I guess? Charging infrastructure, especially home and workplace charging are obviously crucial, but car-stupid is a mysterious kind of stupid.

  5. So the “answer” is no longer “Miata”, it’s BYD. And yet we’ve known this since the beginning of the Industrial Revolution in Britain 250 years ago: Efficiency means you can target the larger, lower ends of the market and make a higher profit by moving more and cheaper units. (Then you take part of that profit and plow it into R&D and manufacturing infrastructure to increase efficiency and move your market further down into an even larger lower, lower end. Repeat cycle.)

    It’s frustrating to realize how poorly business elites and political leaders have performed over the last 25 years – to the point where a company remembering a centuries-old basic tenet of modern economics seems like a radical innovation that’s creating stunning success….

  6. Both BMW and Toyota 100% know hydrogen powered passenger cars won’t ever be a thing, and have known this since forever, BUT when their heavily lobbied govts come rushing with a big pot of money for “development” it is their duty to take it and say whatever keeps the taps open.

  7. Wouldn’t it be funny if one of the many cards BMW and Toyota are collectively holding is some confidential IP relating to efficient H2 generation at distribution stations? Yeah, I’m sure they’re actually crazy and mismanaging shareholder value. That makes much more sense.

  8. ““After the electric car, which has been going on for about 10 years and scaling up rapidly, the next trend will be hydrogen,” he says. “When it’s more scalable, hydrogen will be the hippest thing to drive.””

    He’s wrong.

    And he should go buy a new or used Toyota Mirai, live with it for a year and try to drive across the country with it.

    And then he should try a Tesla Model 3 and do the same things… and then he will see why hydrogen is an expensive and inefficient dead end.

  9. “Do you expect to ever buy or sell a car using crpyto?”

    No… unless the Canadian Dollar gets hit with hyperinflation due to bad monetary policy like what happened in Zimbabwe.

    “Have you?”


    “Do you have any BTC or ETH?”

    No… but I have some shares in Coinbase… I figure as long as people are using crypto currencies, they’ll need the services of a crypto exchange… and COIN is the only publicly traded one regulated by the SEC… so it’s less shady and doesn’t have a history of data breaches like some of the Chinese exchanges.

  10. In a word, no. Bitcoin/virtual currency was never going to last/work out imo because it depends on people ascribing a value to something that inherently has no value (and also pollutes a ton to produce). Admittedly, normal currency is similar, but at least has backing from nation-states, rather than the local Elon acolyte.

    I say that mostly because of its decentralized nature, and virtually no state actors backing it (bedsides a couple of small, poorer countries), meant that it was competing as a currency with national currencies. It also was structured to make things easier to hide, so not paying taxes on a purchase made with imaginary money means it would infringe on state monopoly, making nation states not want to back it, unless their own currency was so weak that the loss in potential tax revenue was outweighed but “stability”, which obviously didn’t work out.

    Also, thank you Matt for writing the morning dump, everytime I see the “welp”, I’m instantly annoyed and skip over whatever is written.

  11. 2035 is a tight timeline even in Europe where it’s a lot easier to be a fully-functioning member of society without a car at all, but with electric range and prices behaving according to something like (if not exactly) Moore’s Law I don’t see a future for hydrogen in personal cars.

    Once people get used to L1 overnight charging and that fast chargers are needed only on road trips where it’ll increasingly be a sideline to dining and other roadside attractions, nobody’s going to want to be forced to make a special trip to a hydrogen station in an industrial park and spend money up front to refuel once a week just for driving errands around town just like Mom and Dad used to at gas stations.

    1. ICYMI a lot of people died in Europe this summer from heatwaves, at some point you have to make some decisions. And you’re aware what the ‘R’ in your future stand for, right? India and Brazil have also been taken over by right wing populists so I’m beginning to see a pattern…

Leave a Reply