Yes, because of safety mandates the price of a new car has gone up. I bought a brand new base model Toyota for $11k in 2001, and the cheapest brand new cars now are closer to $20k.
BUT, cars now also last far, far longer. There is still a massive market for cars under $10k that will run for many 10s of thousands, if not 100 thousand more miles with minimal maintenance.
20 years ago cars wouldn't start. Or, you'd need to know just how to turn the key or finesse the clutch. None of that is a thing any more.
Yes, safety makes cars more expensive. It definitely saves lives. But, I'd need evidence that there are not cars available for the poor. It's only NEW cars that are unavailable, but you can find plenty of cars with backup cameras and a lot of life left in them for cheap in the used car market.
To add: it’s hard to imagine but 2001 was over 20 years ago. Inflation is something you must consider, and wow, $11k in 2001 is $18,400 in 2022. Even if you exclude our recent inflation crisis, in 2021 it’s still $16,800.
You both are missing the demand side of the picture. From 2001 to 2020, Real median household income has risen by 9%. Automobile prices have risen by 21%.
The comparison of real household income to vehicle CPI doesn't really make sense. The "Real" in the first stat refers to the fact that it's CPI-adjusted, while the latter can be thought of as being in nominal (unadjusted) terms, as it is itself the adjustment factor. This means the first number is already lowered to account for the second.
Put another way, if "CPI - New Vehicles" accounted for all of CPI, the comparison you give would mean that people get 9% more car for their income than they did in 2001.
To do this right you'd need to compare nominal median household income, which has gone from ~42k to ~67k over the period in question, an increase of ~60%. This leads me to believe that the ability of the typical household to afford a car increased 2001-2020
NEW car prices may have grown faster than income, BUT cars last far longer, so there's more market availability at the lower price point. There are more used cars that are reliable for sale.
Covid has us in a weird used car bubble, but generally, once that blip is over we're in an era where reliable cheap cars have far less issues than any time in the past.
The average age of cars have risen from 9 to 11 years [0], you are correct. However, though the vehicle depreciates at a lower rate, the cash paid doesnt change as financing periods are not linked to the usable life of the vehicle.
Your mental framework of greater reliability leading to a glut of used cars is still theoretical at this point. Used car prices are up 33% from 2001-2022. I don't think it's a sound assumption to believe the rise in car prices is a "blip". The supply chain is as fragile as it ever was. With a move to onshoring (e.g. the chips act), a war with Russia and much-worsening Chinese tensions, I don't see anything but a secular shift in how cars are manufactured.
In terms of mechanical reliability and longevity, this is certainly correct. But I'm really curious what the software side is going to be like, with cars being more and more dependent on the Cloud or other online services. At some point, older APIs and services will be deprecated, effectively disabling the cars. This will be quite extreme with Teslas, of course, but other cars are catching up in terms of requiring a more or less constant Internet connection.
Yes, because of safety mandates the price of a new car has gone up. I bought a brand new base model Toyota for $11k in 2001, and the cheapest brand new cars now are closer to $20k.
BUT, cars now also last far, far longer. There is still a massive market for cars under $10k that will run for many 10s of thousands, if not 100 thousand more miles with minimal maintenance.
20 years ago cars wouldn't start. Or, you'd need to know just how to turn the key or finesse the clutch. None of that is a thing any more.
Yes, safety makes cars more expensive. It definitely saves lives. But, I'd need evidence that there are not cars available for the poor. It's only NEW cars that are unavailable, but you can find plenty of cars with backup cameras and a lot of life left in them for cheap in the used car market.