Used Car Price Bubble - Jeep Impacts

[aldo98229]

Yes, there has been lots of inflation over the last 50 years. In fact, most of it took place during the Carter and Reagan administrations.

But c’mon, comparing the price of a 2021 JL to a 1980 CJ is absurd. CJ didn’t have 300HP, 4 doors, 32-inch tires, electronic fuel injection, coil springs all around, airbags, satellite radio, shift-on-the-fly 4WD, aluminum wheels, disc brakes, power locks, windows or mirrors, etc., etc., etc.

Yes, the Fed has had a relaxed monetary policy. It’s been going on for decades now, under administrations from both sides. Most recently has been in response to COVID and all of that.

Thing is we, collectively, have become addicted to cheap money. CEOs, politicians and the media all start screaming the second the Fed signals an increase in interest rates. Wall Street freaks out, markets take a dive, our 401ks take a hit, our home values cool off, then individuals and the media freak out and everyone starts pointing fingers. Pressure then builds on the Fed to keep interest rates low so that we can keep this party going.

For all the ongoing blabber about fiscal and monetary restraint, no one is seriously willing to make sacrifices.

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[JABCAT]

I haven't posted on this forum in years, but I just had a recent experience on Dec 29th, trading my 17 JK Wrangler Limited Sport, with 21K miles, on a new '21 JLU Rubicon Extreme, loaded. MSRP on my JK was $33K, we paid $29K. Two weeks ago, the dealership gave us $28K on the trade, selling the Rubicon at MSRP. They had our JK on their web site listed for $34,900. They evidently sold it Saturday because it is no longer on their web site. It was a great deal for us, but I can't believe it sold for $33 or $34K after 4 years.

We had a 2016 Unlimited Backcountry Edition, purchased brand new in April 2016. MSRP was almost $46k, we paid $42k. Sold it yesterday morning for $37K with 61k miles on it. Dealer where we have our '22 ordered offered $33.5k on trade-in, but I decided to list it just to test the waters.

I was contacted within an hour of listing it on Facebook, gentlemen and his wife came to look at it an hour later, gave me a deposit to hold it until yesterday, then met me at my bank with cash. So we spent only $5k for almost 6 years of ownership and 61k miles, not bad.

 

[MerPinXEss]

Yes, there has been lots of inflation over the last 50 years. In fact, most of it took place during the Carter and Reagan administrations.

But c’mon, comparing the price of a 2021 JL to a 1980 CJ is absurd. CJ didn’t have 300HP, 4 doors, 32-inch tires, electronic fuel injection, coil springs all around, airbags, satellite radio, shift-on-the-fly 4WD, aluminum wheels, disc brakes, power locks, windows or mirrors, etc., etc., etc.

Yes, the Fed has had a relaxed monetary policy. It’s been going on for decades now, under administrations from both sides. Most recently has been in response to COVID and all of that.

Thing is we, collectively, have become addicted to cheap money. CEOs, politicians and the media all start screaming the second the Fed signals an increase in interest rates. Wall Street freaks out, markets take a dive, our 401ks take a hit, our home values cool off, then individuals and the media freak out and everyone starts pointing fingers. Pressure then builds on the Fed to keep interest rates low so that we can keep this party going.

For all the ongoing blabber about fiscal and monetary restraint, no one is seriously willing to make sacrifices.

I did not mean for discord aldo, I was using a jeep as an example. 'Fill in the blank product'(apples, land, bread) costs more today because of cheap money, was my point. As you stated, high inflation requires pulling the reigns. Your statement about Carter/Regan inflation is the history that can be learned from charts, so as not to overreact when all the talking heads start pointing fingers. IMHO rates will go up and we will all be ok, but inflation is a genie that cannot be put back into the bottle.

 

[aldo98229]

I did not mean for discord aldo, I was using a jeep as an example. 'Fill in the blank product'(apples, land, bread) costs more today because of cheap money, was my point. As you stated, high inflation requires pulling the reigns. Your statement about Carter/Regan inflation is the history that can be learned from charts, so as not to overreact when all the talking heads start pointing fingers. IMHO rates will go up and we will all be ok, but inflation is a genie that cannot be put back into the bottle.

I think we agree.

But for people to understand the economic sacrifices that are required, we need political parties that put the well-being of the country ahead of scoring individual victories, and media outlets that put the well-being of the country ahead of weekly ratings and quarterly profits. These sectors need to drive a national discourse that lets the electorate understand what are the required short-term pains, and what are the potential long-term gains. We are nowhere near there.

Throughout our history we needed deep crises like the Civil War, the Great Depression, WWII, to get us off our bad habits. Unfortunately, I doubt anything is going to change the status quo until the shit hits the fan...

 

[Shibadog]

And I fear when reality finally hits there will be lots of unhappy campers when they find that they owe more on the 3yr old vehicle they bought for more than it’s original msrp than a readily available new model costs. Going to get ugly..

 

[viper88]

The 2022 Wranglers had a pretty good price increase yesterday. Some people are reporting $2K more for their builds in the Jan 2022 Build Guide over the Dec 2021 Guide. I wonder if that will help used pricing.

 

[aldo98229]

The 2022 Wranglers had a pretty good price increase yesterday. Some people are reporting $2K more for their builds in the Jan 2022 Build Guide over the Dec 2021 Guide. I wonder if that will help used pricing.

It has so far.

Question is: if demand slackens and manufacturers start discounting, will used prices hold?

Doubt it.

 

[Pinky Tuscadero]

They'll drop a bit for sure if everything else straightens out but as Jeep Wranglers they will still be top dog - the car with zero rebates for years now and with the highest resale values.
Yeah, if you were an idiot and paid dealership markups and addons and nonsense which is far more out of control today then ever you will lose the most but there is good news for those folks too -They are idiots and they won't realize they lost the money
The mini-vans, cheapo sedans, fake muscle cars, so called "sport utility vehicles" which, by the way are just station wagons will drop pricing in a freefall and probably that 30% drop
Wranglers - maybe 10%...... maybe

 

[clickclickboom]

I went and pulled numbers from Manheim.com for a 2020 JLU Rubicon

Today 52,400
1 mo ago 53,200
6 mo ago 52,900
1 yr ago 46,400

Projected 1 mo 51,500

Looks like prices may have leveled out and are going to depreciate from this level. I'm not says a reversion back to the norm, but a trajectory downward.

 

[four low]

Spring ,Jeep Season, wil see see a rebound. Chips, inflation not going away any time soon

 

[LuvHydro]

Spring ,Jeep Season, wil see see a rebound. Chips, inflation not going away any time soon

Everything I've read/watched (and that's a lot, everyday, for a month) indicates a continued increase in used vehicle prices through the first quarter of 2022.

The primary driver being even if the chip shortage was resolved today, the rental car companies will buy millions of the newly produced cars straight away, so the dealers lot orders are still gonna be screwed for awhile.

I'm sitting on an expiring on Monday Carvana quote for my '21 Hella that is just 🤏 that far away from my "take it and run" trip point.

Sadly, my ordered '22 Hydro JLUSS is still in D. Based on others, it could built tommorrow or in August, who knows.

I requested a Vroom quote with an added comment, which triggers a human to look at it, so waiting to see what they come back with.

Feb-March will see an increase in used vehicle prices,,,,, or it won't.

 

[sheram]

Several sources which track used car pricing are predicting the used car price bubble to burst in 2022. Given the extreme run up, used car prices are predicted to fall 30% by year end. Given the run up, this takes us back to a more normal market for used cars. Do you think Jeep will fall in line with the rest of the used car market in this price bubble?

My 2019 JLR that I traded in November for a 2021 JLUR is still in their used car inventor. price drop from $46000 to $43500 still sitting

Several sources which track used car pricing are predicting the used car price bubble to burst in 2022. Given the extreme run up, used car prices are predicted to fall 30% by year end. Given the run up, this takes us back to a more normal market for used cars. Do you think Jeep will fall in line with the rest of the used car market in this price bubble?

 

[LuvHydro]

My 2019 JLR that I traded in November for a 2021 JLUR is still in their used car inventor. price drop from $46000 to $43500 still sitting

I still believe the peak prices are yet to come during the upcoming '22 Tax Refund/Spring Weather months and then we will see a gradual decline starting 3rd quarter of this year.

I've been tracking Carvana and Vroom quotes weekly for my JLU stripper since November. Vroom topped out in December and Carvana last week.

As I mentioned prior, last week I received a Carvana quote that was reasonable, tho it was about $800 below the highest quote I ever got, which was Vroom. Since then both Vroom and Carvana have dropped significantly as in $5,000 AND $4,000 respectively.

I prefer Carvana due to my past experience selling to them and I like getting that check before they take my vehicle, so I agreed to their offer today.

I now have a little over 3 weeks before I have to give them my '21. It is doubtful, but possible one or both companies offers will surge before then, but I am not expecting that to happen until late February or March.

 

[rcadden]

The mini-vans, cheapo sedans, fake muscle cars, so called "sport utility vehicles" which, by the way are just station wagons will drop pricing in a freefall and probably that 30% drop
Wranglers - maybe 10%...... maybe

This is what I keep looking at. My little brother *desperately* wants one of those Kia Tellurides. Don't get me wrong - Kia has come a *long* way in the past ~10 years in terms of style, quality, reliability, etc.

But it's still a ~$40K Kia. 5 years from now, there's no way it's going to be more than a $20K Kia, maybe less.

 

[Levin_tom]

My good friend is moving out of the country and he’s willing to sell me his 2018 Sahara for what he owes on it which is $33K. It has 66k miles. What do you guys think I could get for it in the used price market?

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