Historically, car buyers have been less sensitive to swings in fuel prices than you might guess. People want the cars that they want, and most consumers seem to view energy price changes as temporary. New data shows that one part of the market maybe doesn’t look at it that way anymore.
I flew from NY to LA yesterday for the Galpin Car Show this weekend and I’m still recovering from the 60-degree swing in temperatures, so thanks to Thomas for taking over Morning Dump duties yesterday. I still have New York on my mind, and I’m glad to see the Chrysler Building is getting saved. You know who might not be saved? One or both of the brothers behind the First Brands fiasco, who appear to have turned against each other in the legal fight over the failure of the company.
Cars & Bids is putting up cars in its second hybrid/live auction, and there’s some great stuff being listed.
My Hybrid Theory Hits The Used Car Market
I’ve mostly discussed the Decade of the Hybrid as a new car phenomenon, as that’s where the initial wave of hybrid growth/EV stagnation first appeared. What about the used car market? New data from Cox Automotive shows that fuel economy is one of the best predictors of value change this year.
The wholesale value of a used car is how economists and dealers look at the used car market in general and the best source of this data is the Manheim Market Report (MMR). Here’s how the MMR normally breaks down values:
Normally, I think of car values in terms of class as well. Is it a luxury car? Is it a truck? That kind of thing. Props to the folks at Cox/Manheim, who made a chart I’ve never seen before and is super helpful:
Look how clear that is! Excluding EVs, in the first three quarters of the year the most obvious predictors of value change is now fuel economy. I feel like it’s not often these days that you’ll get a chart that’s so obvious.
Here’s Cox’s Jonathan Gregory with more details:
That’s a spread of about 25 percentage points in nine months between the least and most efficient vehicles. And because EVs aren’t in this chart, the efficiency premium isn’t just an EV story: hybrids and other high-mileage vehicles are gaining value while the rest of the market depreciates. Some overlap with segment remains, since the low-MPG buckets are still dominated by full-size pickups and large SUVs. But the gradient is steep and orderly enough that fuel costs are clearly part of the story. Diesel is the sharpest example. Diesel vehicles are only about 3% of the units on the ground at Manheim, but with diesel near $6.50 a gallon, diesel days’ supply rose to 39 days in September. That’s 11 days above the overall market and up 27% from a year ago
If you’re sitting on a slightly used hybrid vehicle you might consider that now isn’t the worst time to trade it in.
The Chrysler Building Is Saved
I love when people visit New York and look at the Chrysler Building and immediately go “Is that the Empire State Building?” I get it. The building, while no longer the tallest in the world, is still one of the most distinct.
It’s also been in a longstanding state of disrepair. Like the Chrysler brand itself, though, it sounds like the building is getting a new lease on life.
The skyscraper, opened in New York nearly 100 years ago, will see its Art Deco crown polished and restored during a refurbishment that will also involve the restoration of the building’s 77-storey façade.
Developer Tishman Speyer has taken over the lease from the Cooper Union for the Advancement of Science and Art, a private college.
Tishman Speyer and its partners will invest $235m (£178m) in the project, as part of which it will upgrade the 61st floor, which is home to huge eagle gargoyles and will also feature an “upscale” lounge.
That’s fun. The money from the building will apparently be used to return Cooper Union to a tuition-free campus.
The First Brands Fiasco Turns Fraternal
First Brands is/was the megaconglomerate behind many of the best known brands in the automotive aftermarket. The company had to file for bankruptcy after it was revealed that the leadership allegedly committed massive fraud to the benefit of its owner and founder.
According to Bloomberg, both the owner and his brother are requesting separate trials because they plan to blame the other brother for everything that happened:
Patrick, the company’s founder and former chief executive officer, said in court papers that he gave Edward a powerful position as executive vice president because he trusted his younger brother completely. Edward cultivated and managed lender relationships and entered into harmful side deals “which funneled tens of millions of dollars into Ed’s own pockets,” Patrick’s brief said.
“To keep his scheme afloat, Ed lied, shirked inquiry, and concealed his self-dealing from Patrick, who was focused on running the companies he founded,” Patrick’s lawyers said. “All told, Ed’s conduct shows that he alone organized, managed, and directed the alleged fraud.”
And the other side of this? Per Bloomberg:
Edward offers a starkly different account, saying Patrick controlled First Brands while he “played the exceedingly narrower role of sourcing working capital financing for the company.” His older brother got others “to brazenly falsify and misrepresent the company’s financials and pervert the legitimate financing structures that Patrick enlisted Ed to secure,” Edward’s lawyers said in a Sept. 4 filing.
That is messy.
Cars & Bids Goes Live
The renewal of Willow Springs is an exciting story, and long overdue. As part of the big Willow Springs Reimagined event celebrating the upgrades, the folks at Cars & Bids are going to do a hybrid auction (live and online at the same time, not of hybrids), and there’s some great stuff.
Obviously, Doug’s Ford GT is high on the list, having both the Doug provenance and being a Ford GT. There’s a Porsche by Singer, which many people find appealing.
I’m a simple man, though, and I think I’d be happy with the Renault Clio V6.
What I’m Listening To While Writing TMD
Now that I’m on West Coast time I have to adjust, because I’ve been living in a “New York Minute” as Don Henley sang… though I’m not sure what a New York Minute is.
The Big Question
Do you care more about fuel economy than you did five years ago?
Top photo: Cox, GM, Honda
TBQ: Yes, the bill to fill my motorcycle fuel tank went over $10 for the first time!
Is there a chart breaking down the used EV market? It was never very good, but I made $7,000 over what I paid for my last EV when I sold it back to the dealership this past July. Unheard of before this year, and this was an EV they were giving huge incentives on in 2025 (received 18% off msrp at purchase).
Why are you listening to a Texas boy sing about New York, when Billy Joel has the best New York song catalog in the business?
Because Billy Joel.
I didn’t realize Coopers Union had started charging tuition. That was one of the schools I almost attended in the 80s when it was free. I can’t believe they’re giving up the Chrysler building. That was a big part of their income – they had some weird setup where they got all the property taxes from the land.
Do you care more about fuel economy than you did five years ago?
Yes but even 5 years ago fuel economy was a major consideration since fuel economy = better for the environment, and the global warming crisis was already well under way then. I wouldn’t stop me from getting a vehicle with enough hp/torque to do the job (truck/race car), but all things being equal, the more efficient vehicle would be my first choice.
Thanks to the corrupt politicians and the morons that elect them (against their own self interests), our grandkids and great grandkids are so screwed.
Thumbing through the responses and comments: I wonder if the definition of “gas guzzler” has changed? Seems just a few years ago that 25mpg was consisdered decent. Now, not so much
Maybe we need an “autopian asks” on this one, I wouldn’t consider a truck or a van getting 25mpg as a guzzler. But a sedan, yes.
“According to Bloomberg, both the owner and his brother are requesting separate trials because they plan to blame the other brother for everything that happened”
Imprison them both and let God sort it out.
TBQ Nope. I’ve had it near the top of my list since I sold my not so thrifty XJ.
TBQ – Nope! I have ALWAYS been concerned about fuel economy. Even to the point of riding my Honda CB350 year-round in the Seattle, only succoming to four wheels when it snowed when I moved there for my first job after college in 1978.
Yes, but that change for me happened three years ago. I drove a pickup that averaged 16. Traded in for a PHEV. Wife traded in for an EV. Our electricity is free, so now we pay less than $100/mo for gas, unless we go on a trip. Its pretty sweet
TBQ: Not really.
Both my wife and I work from home and our annual combined mileage is probably below 9000-miles. My bigger concern is the hit on Used values for diesel vehicles as we will be looking to sell her car in the next 12-24 months. Hoping things get back to normal before then (not that a 10-year old VW has a lot of value to begin with).
Our main car (her car) has a big fuel tank, 26-gallons. We filled it last week and even with 90-cents/gallon off due to Kroger Fuel Points, was still a $120 fill up for about 24-gallons. First time I’ve ever put 3-figures of money into the tank of a non-RV… It felt weird (young me remembers filling up the 1993 Family Camry at the corner store with $20 my Mom would give me, and me bringing change home).
TBQ: Yes. I want to reshape my garage so I have at least a PHEV if not a full EV for DD and a different ride for going out with family and my annual pilgrimage back to my home state of Colorado.
TBQ – yes, but I replaced a 4cyl with a V8. I am on the train right now.
TBQ. I’ve always cared. Efficiency is sexy.
TBQ: No I drive an electric for 80% of my families driving. Just upgraded from an Ioniq 5 to an Optiq and I just look at gas prices for amusement. Well really diesel prices which are insane in CA. The highest I’ve seen is $9.59 a gallon.
TBQ: Yes.
I have to admit that for the first time, I care a bit about fuel economy. I’ve never owned a pickup or large SUV so it hasn’t been much of a consideration. But now that there are so many turbo options requiring premium fuel (~$5.50/gallon locally), I consider it a strike against those cars.
I’ll still drive a gas guzzler for fun, but would think twice about commuting in one.
TBQ: I actually care less, but only because I went from commuting 150mi/day to 3mi/day. If i still had that long commute current fuel prices would be eating me up like they did in the summer of 2022. Last fill up was for $4.77/gal for 93 octane, next one won’t be until next week at the earliest, Shout out Speedway perks.
TBQ: Not really. I have a short commute so prices would need to increase really dramatically for it to matter much. That said, I’m not likely to buy some gas guzzler and I’d be hesitant to get something that requires premium if I were shopping right now.