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My car died, needing a new engine, so I was forced to get one in October. I usually only buy used, but prices are so inflated it didn't seem worth the premium.

My car died, needing a new engine, so I was forced to get one in October. I usually only buy used, but prices are so inflated it didn't seem worth the premium. Used 2017-2020 Toyota Rav4's with 30-60k miles were the same price as a new 2021 model, if you could get one. I knew it was bad, but I was shocked of how bad it was. I went to multiple mega dealerships with 500-1000 cars that were all spoken for. Most had 0 new cars available.

kybernetyk 5y ago
Same here. For just 10k euros more I got a current year new model vs a used 2016. Used car market is crazy.
- bogota 5y ago
  That doesn’t seem that crazy to me.
  - toxik 5y ago
    Yeah, 10k€ is certainly not change.
Syonyk 5y ago
At that point, why not just put a new (junkyard from a wrecked one) engine in?
- dlmiller 5y ago
  $7,000 to put a new engine in a 2011 GMC Terrain that was worth maybe $8000. The engine was recalled by GM for excess oil consumption, my engine had the fixed installed and still died 30k miles later. I went with a new one because that particular vehicle ended up costing me more monthly than a car payment.
  - mytdi 5y ago
    I think OP's advice is good, that's what I would do, but I think for this particular vehicle it's not a good idea to replace the engine with a used one from a junkyard, because they have a lot of engine problems and the replacement engine wouldn't last long either. A friend of mine found out the hard way. Other vehicles though, I think it would be worth it replacing the engine with a used one in good condition.
  - hourislate 5y ago
    Stop buying shitty GM's. I learned my lesson back in in the late 90's when I couldn't keep a GMC Sonoma running long enough to sell it (was like 3 years old). In 2000 I became part of the Toyota family (worked for FORD at the time) and never bought anything else since. The 2 Toyota and 1 Lexus we own are between 14-11 years old and look and run like they came off the assembly line yesterday (all 3 were bought used). I figure I am still good for another 5 years minimum on all of them.
    - throwaway0a5e 5y ago
      Lifetime TCO is a thing. If you bought a Bubble Taurus in '99 and fed it a new transmission every 100k you'd probably come out the same after adjusting for inflation between then and now. I deal exclusively in shitboxes that are about 10yr beyond what the demographics most represented. Anyone peddling a "just buy a particular brand and you'll be all set" narrative is just wrong. If you said "be rich enough to do maintenance on the book schedule and not abuse your vehicles" you'd be on to something. There's a reason everyone wants a used grandma car.
      - WkndTriathlete 5y ago
        That depends on how much you value your time. I have had Hondas for the past 25 years that have not required major repairs for anything. Worst was having to get the automatic transmission solenoid replaced on a Pilot with 240k+ miles on it. In your world that would be 6 transmissions over three cars over 25 years; there's no way I would make that trade, since those 6 transmission failures represent significant lost time (opportunity and time costs when the car breaks down, getting it back and forth to the repair shop, etc., etc.)
clavalle 5y ago
I was in the same boat. I usually avoid buying new but used cars are nearly the same price as new (if you can find a dealer that hasn't done ridiculous 'market adjustments'). So we bought new. We had to buy a car that was just off the delivery truck before the dealership had it inspected. The one we'd looked at two days before was long gone and they expected the one we bought to be sold the next day. My neighbor traded in his truck for more than he paid for it two years ago. It's bonkers. Mechanics are about to make a killing.
- baggy_trough 5y ago
  Why do you think those market adjustments are ridiculous? Isn't that how supply and demand will adjust?
  - lotsofpulp 5y ago
    If you are adversely affected by price changes, then price changes ridiculous, absurd, and ripoffs. If you are beneficially affected by price changes, then price changes are a result of supply and demand.
    - eru 5y ago
      There's a third option: The market clearing price has increased, but sellers refuse (or are banned) from increasing their prices. That way leads to queues and shortages. Of course, in the opposite direction you get inventory piling up (or unemployed people).
  - clavalle 5y ago
    You're right, poor choice of words. Quite rational market adjustments. However...I did end up going to another dealership that didn't do the adjustments. Since I tend to stick with vendors, especially for large ticket items, I suspect the total lifetime value the first dealership missed out on by tacking on the market adjustment (that they didn't tell us about until we asked -- it wasn't on the sticker), eclipses the extra profit they would have made on that sale, even when adjusting for the time value of money.
willis936 5y ago
My SO's Subaru Outback's engine died recently. It would be $5000 to replace it. Not being able to justify the cost when it had an engine replacement 2 years ago, was already 9 years old, had 160k miles on it, and us not needing a second car, we decided to just sell it. A dealer bought it for $6500 knowing that the engine was shot. I was expecting like half of that with an optimistic estimate.
- mdoms 5y ago
  An engine replaced 2 years ago should absolutely not fail and should be under warranty.
  - olyjohn 5y ago
    It was likely replaced with another used engine. No mechanic is gonna warranty that for 2 years, and I doubt they'd even warranty a new engine for 2 years unless they rebuilt it themselves. You'd have to take that up with the engine manufacturer / refurbisher or the person who sold it.
    - avidphantasm 5y ago
      It's a Subaru, they blow through engines. A relative had a 2014 Forester and it had two engines replaced under warranty. This is apparently a known problem with a certain recent version of their 4 cyl. boxer engines.
      - OldHand2018 5y ago
        For sure. If you want a Subaru that lasts forever, get the 3.6R - it's a bulletproof 6-cylinder paired with a heavy-duty transmission. They stopped making them about 2 or 3 years ago.
devilbunny 5y ago
I've done significant work to a 20-year-old car recently. Over $4k. It's easy to justify when you consider how much replacing it right now would cost.
hedgehog 5y ago
I bought a RAV4 over the summer. There was no inventory (hint: dealer web sites will lie to you about what's actually available to purchase), I ended up reserving one that hadn't been shipped to the dealer yet and waiting for around a month for it to arrive. Autotrader shows zero of the same trim for sale used within 500 miles so not even sure what it would sell for.
- Loughla 5y ago
  Bought a new Subaru Impreza this spring. We had been saving for a couple years for my (close enough) dream car (wanted the WRX STI, but that maintenance is a real bitch). We have now had 4 calls from the dealership where we bought it offering to buy it back for thousands of dollars more than we paid this spring. So far their best offer was $6500 more than what we paid. It's outrageous.
  - Scoundreller 5y ago
    Counter at >$8k. Always reject their first offer.
  - UncleOxidant 5y ago
    > So far their best offer was $6500 more than what we paid. Wow. That would be tempting. I'd probably take an offer like that and just use Uber for trips for a couple of years until all of this blows over.
  - moosebear847 5y ago
    Does this mean the dealership thinks they can sell it for $10K+ more now even used?
    - BoorishBears 5y ago
      Even if they sell it for what they pay OP they can make money off financing
- chrisseaton 5y ago
  Funny how Americans want to be able to buy cars directly from the forecourt of a particular dealer then and there. When I buy a new car in the UK I order from the manufacturer. In America how do you get the spec and colour you want if they've already made the car? And don't you object to buying something that's been sitting around outside for a while with lots of people getting in and out of it?
aeturnum 5y ago
My car isn't dead yet, but it's around the time I would look at buying another used car. I bought a used motorcycle instead and am splitting miles.
gremloni 5y ago
I bought a new car about a year and a half ago. With 3 years 0% interest, I put the entire amount in an index fund and have been paying installments. At this point I’ve paid ~18,000 but because of market profits and taxes it has only been around $8000 I’ve really ended up paying.
- sroussey 5y ago
  This is the way.
- reasonabl_human 5y ago
  You’re saying you invested the equivalent of the car’s sticker price into an index fund upon purchasing, and draw from that to pay the installments on the loan used to purchase the car? How is this different than just investing all your spare cash? Mindset shift reserving the capital to cover the cars value, like the envelope budgeting approach?
  - gremloni 5y ago
    It’s not really different except it’s better than paying for a car outright during this market and you’ve already put the money aside so you don’t have to worry about coming up with it each month.
MeinBlutIstBlau 5y ago
I had to pay $2k over MSRP to basically get a contract signed to wait for my Corolla not even built yet by end of month. Dealers don't even try to get you to stay for cars. They know someone else will walk in and buy it if you don't. It's that insane.
dawnerd 5y ago
And when you find a car that’s available they all are stacking an extra 10k “market adjustment” on top. It’s a huge scam.
- apcragg 5y ago
  That doesn't sound like a scam? Frustrating if you're shopping, but not a scam.
- bruce511 5y ago
  Isn't that just market economics? Supply and demand? Isn't the greatness of the USA supposed to be predicated on the market being king, and the freedom of people to do what they like? Until there's a shortage of something you want, which in turn drives up the price - then it's a scam?
  - dawnerd 5y ago
    Yes, but it's deceptive how they will market the car as one price, then when you show up be like oh yeah theres this added fee we're going to sneak in.
dghughes 5y ago
I'm in a similar situation my old truck will cost more to repair than it's worth. I thought I'd go EV but two year old used EVs cost the same as new EVs. Used EVs get $5K rebate and new $10K rebate so new it is! But as you say zero new vehicles. I've never seen car lots so empty or new or used.

kybernetyk 5y ago

Same here. For just 10k euros more I got a current year new model vs a used 2016. Used car market is crazy.

bogota 5y ago
That doesn’t seem that crazy to me.
- toxik 5y ago
  Yeah, 10k€ is certainly not change.

Syonyk 5y ago

At that point, why not just put a new (junkyard from a wrecked one) engine in?

dlmiller 5y ago
$7,000 to put a new engine in a 2011 GMC Terrain that was worth maybe $8000. The engine was recalled by GM for excess oil consumption, my engine had the fixed installed and still died 30k miles later. I went with a new one because that particular vehicle ended up costing me more monthly than a car payment.
- mytdi 5y ago
  I think OP's advice is good, that's what I would do, but I think for this particular vehicle it's not a good idea to replace the engine with a used one from a junkyard, because they have a lot of engine problems and the replacement engine wouldn't last long either. A friend of mine found out the hard way. Other vehicles though, I think it would be worth it replacing the engine with a used one in good condition.
- hourislate 5y ago
  Stop buying shitty GM's. I learned my lesson back in in the late 90's when I couldn't keep a GMC Sonoma running long enough to sell it (was like 3 years old). In 2000 I became part of the Toyota family (worked for FORD at the time) and never bought anything else since. The 2 Toyota and 1 Lexus we own are between 14-11 years old and look and run like they came off the assembly line yesterday (all 3 were bought used). I figure I am still good for another 5 years minimum on all of them.
  - throwaway0a5e 5y ago
    Lifetime TCO is a thing. If you bought a Bubble Taurus in '99 and fed it a new transmission every 100k you'd probably come out the same after adjusting for inflation between then and now. I deal exclusively in shitboxes that are about 10yr beyond what the demographics most represented. Anyone peddling a "just buy a particular brand and you'll be all set" narrative is just wrong. If you said "be rich enough to do maintenance on the book schedule and not abuse your vehicles" you'd be on to something. There's a reason everyone wants a used grandma car.
    - WkndTriathlete 5y ago
      That depends on how much you value your time. I have had Hondas for the past 25 years that have not required major repairs for anything. Worst was having to get the automatic transmission solenoid replaced on a Pilot with 240k+ miles on it. In your world that would be 6 transmissions over three cars over 25 years; there's no way I would make that trade, since those 6 transmission failures represent significant lost time (opportunity and time costs when the car breaks down, getting it back and forth to the repair shop, etc., etc.)

clavalle 5y ago

I was in the same boat. I usually avoid buying new but used cars are nearly the same price as new (if you can find a dealer that hasn't done ridiculous 'market adjustments'). So we bought new. We had to buy a car that was just off the delivery truck before the dealership had it inspected. The one we'd looked at two days before was long gone and they expected the one we bought to be sold the next day. My neighbor traded in his truck for more than he paid for it two years ago. It's bonkers. Mechanics are about to make a killing.

baggy_trough 5y ago
Why do you think those market adjustments are ridiculous? Isn't that how supply and demand will adjust?
- lotsofpulp 5y ago
  If you are adversely affected by price changes, then price changes ridiculous, absurd, and ripoffs. If you are beneficially affected by price changes, then price changes are a result of supply and demand.
  - eru 5y ago
    There's a third option: The market clearing price has increased, but sellers refuse (or are banned) from increasing their prices. That way leads to queues and shortages. Of course, in the opposite direction you get inventory piling up (or unemployed people).
- clavalle 5y ago
  You're right, poor choice of words. Quite rational market adjustments. However...I did end up going to another dealership that didn't do the adjustments. Since I tend to stick with vendors, especially for large ticket items, I suspect the total lifetime value the first dealership missed out on by tacking on the market adjustment (that they didn't tell us about until we asked -- it wasn't on the sticker), eclipses the extra profit they would have made on that sale, even when adjusting for the time value of money.

willis936 5y ago

My SO's Subaru Outback's engine died recently. It would be $5000 to replace it. Not being able to justify the cost when it had an engine replacement 2 years ago, was already 9 years old, had 160k miles on it, and us not needing a second car, we decided to just sell it. A dealer bought it for $6500 knowing that the engine was shot. I was expecting like half of that with an optimistic estimate.

mdoms 5y ago
An engine replaced 2 years ago should absolutely not fail and should be under warranty.
- olyjohn 5y ago
  It was likely replaced with another used engine. No mechanic is gonna warranty that for 2 years, and I doubt they'd even warranty a new engine for 2 years unless they rebuilt it themselves. You'd have to take that up with the engine manufacturer / refurbisher or the person who sold it.
  - avidphantasm 5y ago
    It's a Subaru, they blow through engines. A relative had a 2014 Forester and it had two engines replaced under warranty. This is apparently a known problem with a certain recent version of their 4 cyl. boxer engines.
    - OldHand2018 5y ago
      For sure. If you want a Subaru that lasts forever, get the 3.6R - it's a bulletproof 6-cylinder paired with a heavy-duty transmission. They stopped making them about 2 or 3 years ago.

devilbunny 5y ago

I've done significant work to a 20-year-old car recently. Over $4k. It's easy to justify when you consider how much replacing it right now would cost.

hedgehog 5y ago

I bought a RAV4 over the summer. There was no inventory (hint: dealer web sites will lie to you about what's actually available to purchase), I ended up reserving one that hadn't been shipped to the dealer yet and waiting for around a month for it to arrive. Autotrader shows zero of the same trim for sale used within 500 miles so not even sure what it would sell for.

Loughla 5y ago
Bought a new Subaru Impreza this spring. We had been saving for a couple years for my (close enough) dream car (wanted the WRX STI, but that maintenance is a real bitch). We have now had 4 calls from the dealership where we bought it offering to buy it back for thousands of dollars more than we paid this spring. So far their best offer was $6500 more than what we paid. It's outrageous.
- Scoundreller 5y ago
  Counter at >$8k. Always reject their first offer.
- UncleOxidant 5y ago
  > So far their best offer was $6500 more than what we paid. Wow. That would be tempting. I'd probably take an offer like that and just use Uber for trips for a couple of years until all of this blows over.
- moosebear847 5y ago
  Does this mean the dealership thinks they can sell it for $10K+ more now even used?
  - BoorishBears 5y ago
    Even if they sell it for what they pay OP they can make money off financing
chrisseaton 5y ago
Funny how Americans want to be able to buy cars directly from the forecourt of a particular dealer then and there. When I buy a new car in the UK I order from the manufacturer. In America how do you get the spec and colour you want if they've already made the car? And don't you object to buying something that's been sitting around outside for a while with lots of people getting in and out of it?

aeturnum 5y ago

My car isn't dead yet, but it's around the time I would look at buying another used car. I bought a used motorcycle instead and am splitting miles.

gremloni 5y ago

I bought a new car about a year and a half ago. With 3 years 0% interest, I put the entire amount in an index fund and have been paying installments. At this point I’ve paid ~18,000 but because of market profits and taxes it has only been around $8000 I’ve really ended up paying.

sroussey 5y ago
This is the way.
reasonabl_human 5y ago
You’re saying you invested the equivalent of the car’s sticker price into an index fund upon purchasing, and draw from that to pay the installments on the loan used to purchase the car? How is this different than just investing all your spare cash? Mindset shift reserving the capital to cover the cars value, like the envelope budgeting approach?
- gremloni 5y ago
  It’s not really different except it’s better than paying for a car outright during this market and you’ve already put the money aside so you don’t have to worry about coming up with it each month.

MeinBlutIstBlau 5y ago

I had to pay $2k over MSRP to basically get a contract signed to wait for my Corolla not even built yet by end of month. Dealers don't even try to get you to stay for cars. They know someone else will walk in and buy it if you don't. It's that insane.

dawnerd 5y ago

And when you find a car that’s available they all are stacking an extra 10k “market adjustment” on top. It’s a huge scam.

apcragg 5y ago
That doesn't sound like a scam? Frustrating if you're shopping, but not a scam.
bruce511 5y ago
Isn't that just market economics? Supply and demand? Isn't the greatness of the USA supposed to be predicated on the market being king, and the freedom of people to do what they like? Until there's a shortage of something you want, which in turn drives up the price - then it's a scam?
- dawnerd 5y ago
  Yes, but it's deceptive how they will market the car as one price, then when you show up be like oh yeah theres this added fee we're going to sneak in.

dghughes 5y ago

I'm in a similar situation my old truck will cost more to repair than it's worth. I thought I'd go EV but two year old used EVs cost the same as new EVs. Used EVs get $5K rebate and new $10K rebate so new it is! But as you say zero new vehicles. I've never seen car lots so empty or new or used.