"Grindintosecond" (Grindintosecond)
09/25/2014 at 16:41 • Filed to: None
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"Grindintosecond" (Grindintosecond)
09/25/2014 at 16:41 • Filed to: None | 1
| 1 |
Case in point. This car, the Chevy Celebrity with V6, cost $11,600 in 1988. In many ways, it was the 2014 Honda Accord. This was the best selling mid-sized family sedan-ish car then. Today, that position goes to the Honda Accord at $28,000, only $4,800 more than the Celebrity corrected for today's dollar. (more)
You see, we need to dig deeper. what else was selling in 1988 and have things changed? Well, no they haven't. In fact if you look at the type of vehicle instead of manufacturer, we can see the same trend.
1988 sales ranking in order: F-150, cavalier, escort, Celebrity....
2014: F-150, Accord.....
The only things missing are the sub-compacts of today. those cars, the Focus-Fiesta et. al. are behind the Accord but close and people are starting to use those as family cars because honestly, they have become very fat compared to their younger High School self. (The 80's VW Rabbit was smaller than today's Mini.) As far as looking at what things cost today, we can see the best selling family-ish sedan-ish car was not only the same type of thing, a 4 seater v6, but also nearly the same price, give or take a few thousand. But there's something else to see here. The change in what we are buying and what we are paying. For middle range cars, like the Celebrity/Accord, their prices represent about 50% of the annual average household income. (So you know, that was, corrected for today's dollar values, $50,776 in 1988, and $51,017 of today.) So an average family should spend about $25-28k on a new car for their family if they have an average household income. Now, let's look at the other vehicle on the list.
The F-150. Top's in sales starting in 1982 and staying there ever since by a large margin. In 1988 it's price ranged from $10,600 for the styleside half ton to $13,100 for the F-250 3/4 ton supercab. Today's money calls that roughly $21,000 to 26,000. Before I even mention it, we already know the prices of pickup trucks have elevated beyond reason. The 2014 F-150 starts at $31,000 and tops out at over $40,000. that is getting close to 90% of the average household income. Well, you may point out how 1988 trucks were tools and never had luxury leather and amazingness all around. Well true, but neither did the chevy celebrity, where today's Accord does. This points to a status question. Have we begun to care more about our appearance to others more since 1988? Do we want to appear more rugged or sporty so we don't mind paying that price? I want to doubt it. Let's look at an ultimate look-at-me now car to see.
Corvette. 1988 it was the bomb. It was also $30,000 to buy back then. Corrected for today's money, that's exactly the same price you would pay for a middle range Vette now, the Z51 package. In fact you could step down to the base coupe and spend the equivalent of $27,000 in 1988 money. So, in fact the 'vette has become a little bit cheaper? Interesting. It has incredible performance and has risen to shadow or exceed some other world competition, with leather and blue-tooth and other amazingness. So it would appear everything is in line with the past and hasn't changed, with exception to the truck. It's crazy out of control, that market.
All of this research came about in looking for a replacement family car. I'm 40 and I was looking at a nicely equipped Sienna or something along those lines but who has $40k to spend on that? I already lament the price of candy bars and soda machines charging more than the fifty cents I paid in my teenage years. I feel gouged every day! So looking back in history, it's surprising me and re-framing my expectations. things are not too far off of what it used to be. The prices now are within 10% of what we used to pay and are still within the same range as a percentage of the average family household income. What's changed is that now we have to pay for internet, impressive entertainment choices, phone service involving phones that work in space and transmit video! and a larger share of health insurance and education shouldered more than ever before. So, our USABLE household income is way down. the prices of things did not go up in comparison. We just lost out ability to buy it.
How to fight it? buy used is all I can figure out. I can't blame the manufacturers....except for the trucks.
davedave1111
> Grindintosecond
09/25/2014 at 17:11 |
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"I already lament the price of candy bars and soda machines charging more than the fifty cents I paid in my teenage years. "
You see some interesting microeconomic effects in action with the relative prices of chocolate bars and soft drinks in the UK. When I was a kid, a chocolate bar was about 25-30p, and a can of drink was 45-50p. Now, the chocolate will be about 60p (roughly in line with inflation) and the can of soft drink will only be about 65p. The reason is that 500ml bottles of soft drink hit the £1 point a while back and stuck there, as prices tend to do at nice round numbers like that, and so the can prices have had to stay low as well because otherwise everyone would just buy the bottles.