The End of the Road for Car Price Inflation

The car market has been inflating for many years. While the COVID-19 pandemic had a brief period of time where it slowed down, things quickly ramped back up. People are ordering new cars without any discounts, and it’s unclear why. Additionally, manufacturers seem to believe they can charge a premium for their vehicles, regardless of whether people can afford it or not. At what point do they say enough is enough and reach a tipping point?

One of the worst parts of buying a car is dealing with the markup on the market value. The mark-up of market value is a way to charge people more than MSRP, and it’s becoming increasingly popular in car buying. People are being tricked into paying more than what the manufacturer intended, and it’s a rip-off trend. Cars that are high in demand get marked up to unnatural amounts, leading people to be priced out of the market.

Another problem in the automotive industry is the electric vehicle market. While there are a few electric cars that are doing well, Ford’s new electric vehicles, the “Mustang” SUV is struggling because they’re priced so high. Electric cars are often recommended because they’re cost-effective and friendly to the environment, yet the price mark-up only serves to make them less accessible for the average consumer.

Dealers are also suffering due to the rising price tag of cars. As the price to buy a car goes up, dealer stock has increased due to people’s inability to afford them. However, this leads to a critical problem: it’s difficult to move cars that are too expensive for the average person. As a result, dealerships may be stuck with cars that they can’t sell, and this situation is only set to get worse.

It’s time for the car industry to acknowledge that we’re living in a world where people are unable to pay the prices that they are currently setting. The current trend over MSRP is driving people away from buying a car, and the electric car market is struggling too. Dealerships are finding it hard to sell the rising healthcare cost of cars which, in turn, is creating an inventory backlog. The car industry needs to make affordable cars that the average person can buy without breaking their bank. It’s not too late to change this trend, and it’s in everyone’s best interest to do so.