My dear readers, attend to my words and incline thine ear unto my sayings: Car prices aren’t going to stay this low forever. If you’re in the market for a nice new or used car, now may be the time to act. Any time after that may be too late, barring some sort of huge capitulation on the part of this administration or massive economic downturn (or both).
The Morning Dump is in the dumps today, starting with the unsurprising news that used car values continue to rise as panic-buying runs into already constrained inventory. For nice cars, at least, I actually think there’s some opportunity in the future in the crapbox used car space.
New cars? Employee pricing continues, but Ford is upping the price of everything built in Mexico, including our dear Ford Maverick. If you want a Maverick, you better get on it. Toyota? They’re also in the suck, so you can expect those prices to go skyward as well.
One person who doesn’t have to deal with this is Jim Rowan, Volvo CEO… because he was fired. Now there’s a bit more news on how/why that happened.
Used Car Prices Up 4.9% Year-Over-Year In April
Let me start this morning by quoting the great financial voice of our time, Joe Weisenthal, as he provides on Bloomberg the clearest articulation yet of the current moment:
I’ve always thought that the only interesting term is the medium term.
In the short term, the sun is going to rise tomorrow. In the long term, the sun will eventually die, ending life on earth as we know it. It’s in between that’s interesting. What the market does tomorrow is almost certainly irrelevant, and in the long term it will probably go up. What’s interesting is what happens in the medium term. In economic life, tomorrow will probably look like today. The long term is largely unknowable. What’s interesting to talk about is how the medium term looks.
What’s rare about right now is how uncertain the short term is. Everyone is asking everyone else for glints of insight into what’s actually happening to the US economy, and how the tariff strategy will unfold, and how companies are responding to it. And mostly everyone else is just guessing, or they themselves are asking someone else the same question, and they don’t have anything particularly new to say.
If he doesn’t know, then I sure as hell don’t either.
So let’s start with one narrow measure and one that’s, historically, perhaps a little easier to follow. The Manheim Used Vehicle Value Index, or MUVVI — looking at this chart, you can see the immediate low-traffic downturn caused by the pandemic, and then the even wilder upswing caused by pandemic-related new car shortages. You can see prices slowly improve, bottom out, and improve again. Now that line is going up.
What? Why?
“The ‘spring bounce’ normally ends the second week of April, but this year, wholesale appreciation trends continued for the entire month and were much stronger than we typically observe,” said Jeremy Robb, senior director of Economic and Industry Insights at Cox Automotive. “We expected to see strong price appreciation in response to the tariffs, and that’s exactly what came. Weekly trends showed higher values as we moved through the month, but those increases tapered off each successive week. Used retail sales remain stronger than normal, and wholesale days’ supply is a bit tighter, so we will likely see less depreciation than normal over Q2. As we move into the second half of the year, though, the auto market may slow as strong demand likely pulled some transactions forward in March and April as buyers tried to get ahead of expected higher prices due to tariffs.”
On an adjusted level, the index is up 4.9% year-over-year and 2.7% from March.
New cars aren’t even any more expensive yet because of tariffs; this is just the Lease Renewal Super Cliff in action. There are simply fewer good used cars because, 3-4 years ago, the pandemic took millions of potential used cars out of the market. People are rushing to buy anything now.
What does the future hold? I have no idea. If a recession suppresses buying, then perhaps a combination of lower interest rates and lower buying will ease things a bit. It’s not worth experiencing another global financial crisis, especially a self-inflicted one, to lower used car prices.
The slightly positive flipside of this is that enthusiast cars are suddenly a much better deal as new car inventory improves and economic uncertainty drives values back down a little bit.
Ford’s Mexican-Built Cars Are Going To Get Up To $2,000 More Expensive
The best time to buy a Ford Maverick is four years ago. The second best time to a Ford Maverick is right freakin’ now.
While employee pricing still exists, any Ford Maverick built before May 2nd is going to be the same price it was always supposed to be. Built after May 2nd? It’s inevitably going to be the cheap cars that are the hardest hit proportionally, and Ford is reportedly going to be raising prices up to $2,000 over the current MSRP on the Mexican-built cars. Specifically, the Mach-E, Bronco Sport, and beloved Maverick are all likely to see some increases.
Why is this happening? Here’s a Ford rep telling the Detroit Free Press that it isn’t all about tariffs with a straight face:
A Ford spokesperson said the price hikes will affect vehicles built after May 2, which would arrive at dealer lots in late June. The spokesperson said the price hikes reflect “usual” midyear pricing actions, “combined with some tariffs we are facing. We have not passed on the full cost of tariffs to our customers.”
In fairness to the spokesperson, changing the price of the Ford Maverick is one of the company’s favorite hobbies. That it’s so close to the rollout of the new one is suspicious, though.
The guess is that there’s enough inventory to keep Maverick prices normal until at least early June, so act fast.
Toyota Predicts Tariffs Will Lead To A 34.9% Drop In Net Income In FY2026
The leadership of Toyota, seen here planning to dissolve the Imperial Senate, has bad news for investors. And bad news for investors almost always rolls down to customers.
Let’s start with the numbers from Toyota, a company that’s on the Japanese fiscal year. The numbers are really bad. Sales revenues are expected to increase by 1.0% as sales increase this year, yet overall net income is predicted to drop by 34.9% compared to the just-ended Fiscal Year 2025. Why?
This forecast assumes average exchange rates through the fiscal year of 145 yen per US$1 and 160 yen per 1 euro. The impact of U.S. tariffs on operating income is factored in at 180.0 billion yen as a negative impact of April and May, tentatively.
Even though Toyota makes a ton of its cars here in the United States, even it cannot escape the risk of tariffs. That 180 billion yen number is about $1.24 billion in U.S. dollars, which is relatively small compared to the impact Ford and GM are expecting. Presumably, the company is going to have to raise prices eventually to cover some of this shortfall.
The first question at the press conference this morning was about tariffs, of course, and CEO Koji Sato responded:
“Our government-to-government negotiations are ongoing at this moment… at this moment, it’s very difficult to forecast the future. But at the moment there [are] already tariffs that are being imposed, and that part has been reflected in our forecast for this fiscal year. We don’t want to waver from our basic principles, and we will stay the course, so depending on whether you are looking at short-term or medium term it’ll change.”
Ok, so he doesn’t know either, other than to say that over the long term that products will have to be produced and delivered locally.
Alleged Reasons Why Jim Rowan Is No Longer At Volvo
Former Dyson boss Jim Rowan was a curious choice for the Geely-owned automaker, and while you might have assumed that his sudden departure from the company had a lot to do with his openness to killing wagons, this report from Manger Magazin suggests there’s a little more to it than that:
According to manager magazin, the real cause lies deeper: “Rowan was simply unbearable, completely resistant to advice,” commented one top executive on the Volvo CEO’s departure – characteristics that were also attributed to Samuelsson in his final phase at Volvo. But he always maintained a good relationship with Li Shufu.
Geely’s new strategy also apparently proved to be Rowan’s downfall. Li Shufu wants to bring his now eleven brands closer together and leverage potential synergies. Instead of developing technology twice as a loose collection of brands, the manufacturers in the Shufu empire are to work more closely together – similar to the Volkswagen Group, where numerous models from Škoda, VW, and Audi are based on identical architectures.
However, Rowan repeatedly blocked the synergy efforts, according to the company. “Rowan wanted to keep Volvo operating independently as much as possible,” says a manager, who also opposed Li Shufu for a long time in discussions about additional plug-in hybrids for Volvos in China. Ultimately, the Geely owner pulled the plug on the former vacuum cleaner manager.
Rowan doesn’t seem to have provided a comment to MM. We’ve tried reaching out via Linkedin.
So goes Li Shufu, so goes Volvo.
What I’m Listening To While Writing TMD
If you love Gorillaz, but have never listened to Deltron 3030, you’re missing out. Here’s Del, Dan, and Kid Koala doing a full performance of the first Deltron 3030 album live on KEXP.
The Big Question
What’s the best used car deal right now?
Top photo: Ford
Hilarious.
The best used car is the mechanically solid Guards Red manual aircooled 911 coupe that you buy for me. My birthday is next month. Pitter patter.
The best used car deal is the car already in your driveway.
Fix it, maintain it and keep it.
Ran across a beer called Smelltron 3030, I chuckled and bought it because I’m a sucker. No plans for a new car anytime soon, bought a 4runner and a Corolla in the last year or so. 4runner I’ll keep forever, Corolla will stay around as long as it stays reliable.
Deltron 3030. I snuck away from a high school field trip into a record shop to buy that album, hopefully the brew was half as good.
Tesla anything. If you can bear to be seen in one. And/or have an anti-Elon magnet or sticker ready to slap on once the title is signed.
Right now if you’re leasing and your lease is ending and your car is in good condition, your best deal might be the purchase option. I just did it and the purchase price was $6K less than trade-in value ($20.5K vs $26.5K).
Well, I’ll be hanging onto my car for *checks notes* even longer.
2016 Mazda6, bought new in October 2015. Paid off in September 2019. 91,000 miles now (or just under that). Done all scheduled maintenance and some extra recently to ensure it keeps on keeping on, or so it can pull a Wilson Phillips and “hold on for one more day.” I cannot afford to replace it for anything equivalent or better now.
My wife has a 2018 Kia Sedona that we got from CarMax in August. Sedonas aren’t known to be the most reliable, but I took a page out of Doug DeMuro’s playbook and got the biggest and longest-lasting warranty that CarMax offered, so that helps.
So, we should thankfully/hopefully be okay on the car front for the future – barring anything tragic like a natural disaster or an accident/severe mechanical malady.
That being said, Mazdas in general can be some good used car buys! Corollas are expensive? Yes. Look at a Mazda3. RAV4s are high-priced and hard to find? Check on a CX-5. Etc.
My wife’s grandmother was on the hunt for a brand new RAV-4 last fall and no dealers had any in stock or at MSRP. She’d have to wait for one to show up and wasn’t guaranteed a trim-level or color pick. I showed her the local Mazda dealer and its 10+ CX-5s in stock. She went home happy with a Soul Red mid-level one. Sure, the RAV is roomier but she’s just one person except when she occasionally hauls my 4-year-old daughter around, so it still works out.
unfortunately the carmax warranty is no longer in house it’s just a rebrand of an allstate plan you could get yourself. Very annoying because you used to be able to drop/tow your broken car to carmax get a loaner and not have to deal with any of the hassle until your car is fixed. Now you don’t get a loaner unless the repair is going to take over a week to fix and they won’t pay for your rental until AFTER the car has been diagnosed. Also you have to do all the legwork of finding what repair shop is going to fix you up and figure out how you are going to get the vehicle there.. it is SUCH a hassle. overall my max care warranty has paid about 2 grand in repairs so it’s close to a net break even however that 2k was only two repairs and both times i did NOT have the cash in the bank account to pay for the repairs so i’m glad i opted for the max care but very frustrated with Allstate at all the hassle they put me through.
We don’t have a CarMax close to us. They told us to just take it to the Kia dealer, which I have done. The A/C acted up once and the Kia dealer fixed it. CarMax had no problem paying them, thankfully.
unfortunately when my car started acting up the local Hyundai dealership told me it would be THREE WEEKS before they would even look at it. I took it to a precision tune and the mechanic had it all fixed up in less than a day. carbon build up on the valves, fouled plugs, carbon buildup on the throttle body. My point is that you don’t have to go to carmax to get that warranty you can get the exact same plan through Allstate on any car you buy from anyone.
Nissan Leaf. They depreciate heavily after rolling off the lot, despite the condition of the car and the battery. If you just need a car for in town usage they’re great.
Second. I just bought a 2019 SV with 81k miles for $8k. I now work virtually, so it won’t get much use, and fits perfectly into my lifestyle. It’s a riot.
I had a surprising amount of equity in my 2022 Accord that CarMax bought, and now I’m no longer worried about the horribly made 1.5 liter turbo.
Not ideal news especially since when I looked at used Mavericks- prices had barely fallen compared to a new (or new one model year old) one.
Geely is smart for getting rid of the sucky vacuum salesman. It sounds like they are working to fix their issues. Could see some weird stuff coming in the US. Mexico gets geely and they look better and are so much cheaper thr the Volvos we are stuck with. Also I bet that is how everyone at Dyson is. I was I was living in Singapore when those clowns wanted to build a car factory there I thought it was the dumbest thing I’d ever heard especially because they were manufacturing their junk in Malaysia. It’s just across a bridge where everything is a multitude cheaper. But they got everyone worked up about this dumbass car they couldn’t build. Probably the same as that French blue car junk that was all over at the there at the time. I hope the angry mob comes after Dyson next truly junk and clown behavior.
Really depends on where you are but there are some great bev deals out there both dealer and private party. You can get a model 3 for $8k if you look. Plus there is a way to use an escrow dealer to get 30% off up to $3500 though gov incentives. I’ve seen some dealers basically strip the incentives for someone wanting to lower their tax burden and then offer a leaf for $14k as used with less then $100 miles. You can almost always find a Prius for $3k and they just go.
Here is my blanket advice to anyone in need of a car right now. Look at a Nissan Sentra. I don’t think there’s a better Bang for the Buck vehicle out there right now. I’ve been beating this drum for some time now, but that’s because it’s been a steal all year. If you disagree, please make alternate suggestions.
If you’re buying a new car? You’re probably right.
I know this site did a “they’re selling for 18k!” article, which in a lot of regions, isn’t true (nor was it probably true at all, probably a scam).
But they’re still vastly cheaper than basically anything else you can buy. Looks like 22-23k gets you a mid-trim Sentra. And this Sentra is at least an OK car; it’s not the purely miserable shit-box (not in an endearing way, but rather, from the factory) that the last one was.
This is a pre-pandemic car price all things considered.
They weren’t a scam for us. I helped my assistant buy one for the advertised price. It took a little patience on our part, but we got it done. She’s very happy with it as well. Great car for the money. I’d choose it over any used car in the same price range.
Impressed and I know a lot of people here (myself included) are “never Nissan” but geez, an 18k compact sedan in 2025 is a screaming deal.
Unfortunately those sorts of prices (to my knowledge) never made it to the Northeast.
It has been pre-pandemic since i traveled for work consistently, so the Sentra could have changed. I’d get assigned a car in the app by the time i would land in some new place. Just walk straight to the car and drive off. Late teens Sentras were the only car i would stop by the counter and ask them if they had literally anything else. They were truly awful. The Chevy Cruz of the same vintage would just drift all over the road without moving the wheel. I still would pick the Cruz over the gawdawful Sentra.
All I can say is that my assistant’s ’24 model is excellent for the money. It’s just plain a bargain right now compared to everything else.
Jetta?
I’ve been thinking of that too.
That’s a good one. Think both Jetta and Sentra run pretty close to one another in pricing, which is to say cheaper than a comparable Civic/more kit for the money. And more obtainable, nicer, and roomier than a Corolla.
Mazda 3s go for decent prices but runs a little higher than a Jetta or Sentra, and the 3 takes a little hit in fuel economy and space too.
Yes, that’s a great suggestion, but they run $5k more around here. If they were near in price, I might choose the VW too. I do currently own two VWs and two Audis.
I rented one a couple of months ago and it was great. Peppy, comfortable, very usable from a user experience standpoint, not ugly. No ragrets.
I wonder if there was a dust-up when Rowan got bagged.
There is a lot of talk about a big drop in foreign visitors to the US. It’s possible rental car companies my look to ‘right size’ their fleets and open up some used car inventory.