Looking Grim(er) For Stellantis

[Wbino]

When interest rates are this high most people who have to borrow for a car loan aren’t buying a $45K Jeep. When we bought ours last year even with an 800 credit score the interest was going to be 6.5%. I decided to write a check for the Jeep and buy it out right (screw the banks) but most people can not go this route. Glad they have a bunch sitting around the prices have gotten totally ridiculous. Time to eat some humble pie…

It's not the prices it's wages but no one will admit they don't make enough and demand their right to certain vehicles and that manufactures lower prices.
Can't afford a Wrangler? Get a Compass or whatever they are making now.
Prices are here to stay across the industry.

Sponsored

 

[Wbino]

Huh, kinda like the Ford Maverick which turned into a sales success.. Who woulda thunk the market wanted an affordable, utilitarian vehicle that gets decent gas mileage ! You could blow me over with a feather.

This is why different companies and models exist.

 

[VKSheridan]

If that $17 sandwich satisfies my needs and makes me giddily happy, I'll gladly pay full price for it as long as my budget allows. As someone upthread said, life is too short to be miserly. The way I drive and the way I maintain my vehicles, I foresee being very happy with my purchase for a long time.

That having been said, I do agree that Stellantis probably needs to do another post-Covid round of market research.

P.S. Writing "Cheers!" at the end of an insulting post doesn't make it any less rude.

Sorry, you choose to be offended with an explanation of how elevated pricing strategies in the midst of high inflation and interest rates affect consumer purchasing thus creating increased dealer inventories.

Let me use your words, “Bless your heart”. Better?

 

[BXFXJeep]

I don't think the population is generating enough people to keep buying 200,000 Wranglers a year, especially at skyrocketing prices, it would only get worse when people can't get good resale to keep flipping these Wranglers every few years.

I've started locking my doors now, someone steals this Wrangler I'll end up getting a cheap EV, used Tesla 3 maybe. A 2024 same options as my 2021 is 30% more, way more than what I want to pay for a Wrangler.

$3 for an avocado is beyond crazy, before the lockdown Costco sold 5 huge Haas for $6.99, now it's $11.99, luckily every few weeks regular grocery stores have 5 smaller ones in a bag for $2.99.

 

[John VonJeep]

I have a question, the people complaining about Jeep prices, where have you been? It is called inflation. I paid $3 for an avocado today and it was on sale. I like avocados so I bought it. Even if dealerships offer 0% financing, because prices are so high, many people will still be faced with a huge payment. As I mentioned previously, car manufacturers cannot sell vehicles at a loss. It is not about price gouging, it’s about survival. Below are some numbers I copied and pasted from a WSJ article.

INFLATION BY THE NUMBERS THE LAST THREE YEARS
1. Groceries +34%
2. Rent +24%
3. Automobiles +21%
4. Gasoline +27%
5. Alcohol +8%
6. Transportation +37%
7. Housing +25%
8. LPG +14%
9. Healthcare +30%
10. Natural gas +36%
11. Real income -3%

Not included in the list are parts necessary to build a vehicle, tires, transmission, nuts, bolts, wire, aluminum, all of which must be transported to the factory for assembly. Prices are directly related to inflation, if a person can’t buy a Wrangler they will be forced to buy a Yugo. Just like a house, if you can’t afford Newport Beach, you will be forced to live in timbuktu.

People also have fuzzy memories about what stuff used to cost. This 2009 JKU Rubicon was $37,150, or $54,446 in 2024 dollars. And that’s with the 3.8 minivan engine and a 4-speed automatic. The roughest equivalent Rubicon today would cost $56,185 (and that’s with the dual top group). For that, you’re getting and extra 55 hp, full-float rear axle, LED lights, and a bunch of other stuff the 2009 never dreamed of offering.

So you’re right that, overall, inflation seems to be what people are really objecting to. Jeep has gotten greedy in the past 2 or 3 years, but that’s only part of the story.

 

[CT_LFC]

I have a question, the people complaining about Jeep prices, where have you been? It is called inflation. I paid $3 for an avocado today and it was on sale. I like avocados so I bought it. Even if dealerships offer 0% financing, because prices are so high, many people will still be faced with a huge payment. As I mentioned previously, car manufacturers cannot sell vehicles at a loss. It is not about price gouging, it’s about survival. Below are some numbers I copied and pasted from a WSJ article.

INFLATION BY THE NUMBERS THE LAST THREE YEARS
1. Groceries +34%
2. Rent +24%
3. Automobiles +21%
4. Gasoline +27%
5. Alcohol +8%
6. Transportation +37%
7. Housing +25%
8. LPG +14%
9. Healthcare +30%
10. Natural gas +36%
11. Real income -3%

Not included in the list are parts necessary to build a vehicle, tires, transmission, nuts, bolts, wire, aluminum, all of which must be transported to the factory for assembly. Prices are directly related to inflation, if a person can’t buy a Wrangler they will be forced to buy a Yugo. Just like a house, if you can’t afford Newport Beach, you will be forced to live in timbuktu.

I thought inflation was transitory?

 

[Steemax]

I have a question, the people complaining about Jeep prices, where have you been? It is called inflation. I paid $3 for an avocado today and it was on sale. I like avocados so I bought it. Even if dealerships offer 0% financing, because prices are so high, many people will still be faced with a huge payment. As I mentioned previously, car manufacturers cannot sell vehicles at a loss. It is not about price gouging, it’s about survival. Below are some numbers I copied and pasted from a WSJ article.

INFLATION BY THE NUMBERS THE LAST THREE YEARS
1. Groceries +34%
2. Rent +24%
3. Automobiles +21%
4. Gasoline +27%
5. Alcohol +8%
6. Transportation +37%
7. Housing +25%
8. LPG +14%
9. Healthcare +30%
10. Natural gas +36%
11. Real income -3%

Not included in the list are parts necessary to build a vehicle, tires, transmission, nuts, bolts, wire, aluminum, all of which must be transported to the factory for assembly. Prices are directly related to inflation, if a person can’t buy a Wrangler they will be forced to buy a Yugo. Just like a house, if you can’t afford Newport Beach, you will be forced to live in timbuktu.

The real crime here is you're paying $3 for an avocado on sale. Maybe it's your location but large Hass avocado's go for $1.49 a pop regular price at any chain grocery store in my area.

 

[blackwater]

The employment numbers were released today and they came in short….AGAIN. In the past, the numbers have been revised downward, months after they were released. Wall Street is pricing in a Fed reduction in interest rates. Many people think a rate deduction is good, but let’s take a poll.

1. If rates go down, demand for everything will increase, will it cause additional inflation?

2. if rates hold steady, it will cause additional job losses and too many people losing their job will cause a recession….foreclosures, repossessions. The Fed increased rates to put people out of work, thereby reducing demand and cooling inflation. Should rates remain steady, or be reduced?

 

[jeepingib]

I have a question, the people complaining about Jeep prices, where have you been? It is called inflation. I paid $3 for an avocado today and it was on sale. I like avocados so I bought it. Even if dealerships offer 0% financing, because prices are so high, many people will still be faced with a huge payment. As I mentioned previously, car manufacturers cannot sell vehicles at a loss. It is not about price gouging, it’s about survival. Below are some numbers I copied and pasted from a WSJ article.

INFLATION BY THE NUMBERS THE LAST THREE YEARS
1. Groceries +34%
2. Rent +24%
3. Automobiles +21%
4. Gasoline +27%
5. Alcohol +8%
6. Transportation +37%
7. Housing +25%
8. LPG +14%
9. Healthcare +30%
10. Natural gas +36%
11. Real income -3%

Not included in the list are parts necessary to build a vehicle, tires, transmission, nuts, bolts, wire, aluminum, all of which must be transported to the factory for assembly. Prices are directly related to inflation, if a person can’t buy a Wrangler they will be forced to buy a Yugo. Just like a house, if you can’t afford Newport Beach, you will be forced to live in timbuktu.

This explains why I'm just drinking and working. It's the only thing stable anymore.

 

[John VonJeep]

Meanwhile at VW…

https://www.carscoops.com/2024/09/vw-has-one-maybe-two-years-to-save-brand-finance-boss-warns/

Antlitz explained to those present that the European car market had contracted since the pandemic and was unlikely to return to heady pre-Covid levels any time soon, Reuters reports. That drop in demand – and slower than anticipated EV take-up – means VW will sell around 500,000 fewer cars in a year, and gives it a maximum of two years to cut output and reduced costs to steady the ship.​

 

[BuyHold]

On topic of inflation and skyrocketing vehicle costs, I am squarely in the camp of "The price is too D#$% High". That is my personal feeling and would also assert that this is significant contributor to broad slowdown in vehicle sales, among other things (interest rates).

I watched this video recently about vehicle costs. While this is about Diesel Trucks, it did recenter my perspective a bit and think that it is worth watching. Haven't run the numbers but suspect a 1997 TJ vs a 2023 JL comparison would lead to similar conclusion.



edit: I will add that I think this summarizes well what I have heard many folks say in this forum. It is also a widely acknowledged consideration in Economics in the context of inflation measurements (think 1950s tube ray black and white TVs vs modern flat screens, or 1980s Commodore 64 vs modern Laptops).

 

[BXFXJeep]

People also have fuzzy memories about what stuff used to cost. This 2009 JKU Rubicon was $37,150, or $54,446 in 2024 dollars. And that’s with the 3.8 minivan engine and a 4-speed automatic. The roughest equivalent Rubicon today would cost $56,185 (and that’s with the dual top group). For that, you’re getting and extra 55 hp, full-float rear axle, LED lights, and a bunch of other stuff the 2009 never dreamed of offering.

So you’re right that, overall, inflation seems to be what people are really objecting to. Jeep has gotten greedy in the past 2 or 3 years, but that’s only part of the story.

The problem with using today's dollars, is the job that someone had in 2009, is pretty much paying about the same in 2024 as it did in 2009.

The person that bought that 2009 Rubicon might have moved up to better job today and would probably afford a 2024 Rubicon, but the person doing his old job he had in 2009, that person cannot afford to buy the 2024 Rubicon.

So as much as the 2024 has better equipment than the 2009 for the same or less money, the people who can afford it isn't the same as 2009. The Wrangler affordability has shifted away.

 

[blackwater]

Meanwhile at VW…

https://www.carscoops.com/2024/09/vw-has-one-maybe-two-years-to-save-brand-finance-boss-warns/

Antlitz explained to those present that the European car market had contracted since the pandemic and was unlikely to return to heady pre-Covid levels any time soon, Reuters reports. That drop in demand – and slower than anticipated EV take-up – means VW will sell around 500,000 fewer cars in a year, and gives it a maximum of two years to cut output and reduced costs to steady the ship.​

Add BMW and Mercedes to the list!
https://thetruestory.news/en/world/story/a0b9a833-6c24-11ef-8efb-5f52fca9b7d6

 

[MayThe4x4BWU]

Meanwhile at VW…

https://www.carscoops.com/2024/09/vw-has-one-maybe-two-years-to-save-brand-finance-boss-warns/

Antlitz explained to those present that the European car market had contracted since the pandemic and was unlikely to return to heady pre-Covid levels any time soon, Reuters reports. That drop in demand – and slower than anticipated EV take-up – means VW will sell around 500,000 fewer cars in a year, and gives it a maximum of two years to cut output and reduced costs to steady the ship.​

They're also looking to close 2 plants in Germany for the first time ever to help them shore up costs and may look to abandon their "no layoff policy" that's been in place since the 90's with their labor unions.

I wonder how many times the proverbial can was kicked down the road for the various financial decisions made by all involved

 

[Jtphoto]

The problem with using today's dollars, is the job that someone had in 2009, is pretty much paying about the same in 2024 as it did in 2009.

The person that bought that 2009 Rubicon might have moved up to better job today and would probably afford a 2024 Rubicon, but the person doing his old job he had in 2009, that person cannot afford to buy the 2024 Rubicon.

So as much as the 2024 has better equipment than the 2009 for the same or less money, the people who can afford it isn't the same as 2009. The Wrangler affordability has shifted away.

Only To a point. This 2024 model will still cost a lot more to build then that 2009 did. Wages are only a very small % of the increased build cost. Due to tariffs on imported raw materials and such I’m sure production costs have likely doubled since 2009 as well.

Sponsored