Crash in used luxury car prices is starting

cristianosham wrote: ↑ To all the naysayers that was yelling "why would car dealers sell you a car for under mrsp? Instead the prices of new and used are going to skyrocket".
I feel they need to get educated on the basics of supply and demand.

kr0zet wrote: ↑ Source, oh wait it's a guy you know.

Xtrema wrote: ↑ Not surprised at all.

1 year old Q7 will lose 25% of it's value normally.. There is 10-12% drop in wholesale prices, so $62K sounds about right for dealers to pad some margin in there.

So if he's willing to CPO it and sell it to you for $65K, would you take it OP?

Or is he telling you he's getting it for $62 but it's actually even less than that?

Oh the mind games.

xjesterxx wrote: ↑ I gotta respect the upvote ratio here....

Nothing of this sort in Ontario going on at this point.

Maybe in Alberta it is different.

Blubbs wrote: ↑ I wouldn't be surprised if there are jurisdictional differences, but do you work in car sales? This is still playing out at the wholesaler level right now here, so it's going to take time for it to manifest with dealer prices.

Blubbs wrote: ↑ I wouldn't be surprised if there are jurisdictional differences, but do you work in car sales? This is still playing out at the wholesaler level right now here, so it's going to take time for it to manifest with dealer prices.

Xtrema wrote: ↑But the 3rd vector is that if everyone works from home, you don't need a car or public transit.

Xtrema wrote: ↑I think the real picture will emerged in July.

Xtrema wrote: ↑But what do I know, just another guy with an opinion on the internet.

xjesterxx wrote: ↑ I may have some relevant insights, yes.

Xtrema wrote: ↑ The problem is everyone is trying to predict what post-covid world is like but nobody knows. On one side there is people who can't afford payments and ditching their ride. On the other is people who can afford it will start driving more and avoid public transit until a vaccine is found. But the 3rd vector is that if everyone works from home, you don't need a car or public transit.

China has the best car selling months in 2 years after lock down but still if Tesla's Chinese number is anything to go by the pended up demand is short lives as March was strong but Apr is back to 64% lower than March.

I think the real picture will emerged in July. If dealership continue to be starved throughout May and June, then I think there will be glut on new stock that forces manufacturers hands to do something about it.

But what do I know, just another guy with an opinion on the internet.

ES_Revenge wrote: ↑ Yeahhh few people in suburbia is gonna ditch their car just because they work from home and don't need public transit. Things that are "down the street" are still like 10km+ away (stores and stuff I mean) so no point in getting rid of your car when you still need to go to these places. Public transit is a bad idea if you're afraid of a virus, as are taxis/ubers with tons of people getting in and out of closed-quarters (vehicles) all the time. Plus if they have kids they're def. not getting rid of their cars--school's definitely gonna go back at some point, maybe not until fall but will go back. No point in selling your car if you just need to buy one again in a few months. I could see, however, selling off (or taking the insurance off) "additional vehicles" if the household has more than one though, sure.


I think so too, about cars...and a lot of other things.


Fairly sensible one at least

Blubbs wrote: ↑ I agree that July could be peak for a lot of things. Including the stock market with Q2 earnings reports lol.

Both of you with reasonable thoughts. Some further points:

1. There is a debt bubble that relates to real estate as well as vehicles and consumer debt.
2. Even if driving remains a priority, the majority of people do not get their next vehicle because the current one no longer can serve its functional purpose. They upgrade, and this drives demand. People do not have to stop driving for a crash, they just have to hang onto and maintain their current cars en masse for a short period of time. Along with some defaults. Then luxury lease returns and repo's will flood the market.
3. Nobody buys a luxury car purely for practicality, they can get something functionally equivalent for less in almost all cases.

Xtrema wrote: ↑ 1. If you read the conditions on Fed's plan on commercial rental relief, it's a bank subsidy in disguise as landlord who doesn't have a mortgage won't qualify. I expect more bank saving spending to come.

And since banks don't hold much car loans or consumer debt, they will probably won't get as much help in those areas.

alanbrenton wrote: ↑ These are consumer goods. They need to be sold to make a profit or stem losses or they wouldn't even be produced. Also has a sensitive shelf life by way of production date and model year.