Anyone tried buying a car during Corollavirus?

[tirwin]

I’m thinking about buying a CPO Macan.

Looking at inventory at local dealerships and neighboring states and found 3 or 4 I’m interested in. I’d like to conduct as much of the deal as I can remotely. I would think that they’d be accommodating right now to have business but most don’t seem to want to do much remotely and want you to be there in person.

I get it that they may not want to waste a bunch of time engaging with Internet tire tickers.

Anyone have any experiences? Do you think the dealers are content to ride this out longer and see if things get back to normal or do you think they’re more desperate than they are letting on?

[maninblack]

I've bought a couple. For the most part, it's been business-as-usual, at least in the collector car market.

[Macroni]

They have opened dealers in PA. You can visit showrooms and test drive.

[tirwin]

I’ve been reading about the dismal car sales numbers but I’m not seeing too much change yet. I did get separate emails from the first sales guy, the sales manager and the GM of one dealership.

One school of thought is that the trough is still 4-6 weeks away.

I suspect the collector market is a little different. People who have a paid-for collector car is in a different place than someone who has a big monthly payment on a toy or a “nice to have” they need to get out of.

[tirwin]

Originally Posted by Macroni

They have opened dealers in PA. You can visit showrooms and test drive.

Same here.

When I’m shopping for my wife I always take her to a place like Carmax to see as many different kinds of cars in one place as possible just to narrow down the field.

I tried to call the other night to see how they were operating and no answer. We went out to the store and drove by the dealership and it was covered up. I walked in and asked what their protocol was for shopping and they said I’d have to come back another day because they were so busy. You would’ve thought they stopped making cars and people were trying to get the last ones.

Pent up demand? People spending stimulus money? People worried about the market and trying to get out of bad deals? All the above?

[Otter74]

I bought a CPO Jetta TDI wagon in mid-March, when I had some concern about going to GA to get a car (I have family to visit there) but about a week before everything around me (Chicago) started shutting down and I still did everything in-person at a dealer in Milwaukee. Just early enough that everything was normal. In IL dealers are open normally for service but you need an appointment to go to the showroom for sales.

[specialtyoneinc]

I would think you can get some good deals in the CPO Porsche market even though it's hard to gauge the market since so many dealers/auctions have been closed. I don't see a huge change in the new Porsche market since dealers are expecting a gap in inventory / allocations once their in-stock units start moving.

[1979-930]

Originally Posted by tirwin

Pent up demand? People spending stimulus money? People worried about the market and trying to get out of bad deals? All the above?

I think it goes back to the fact most Americans suck at managing money.
You have all these people that are now pulling in $1,100.00 a week and think they can now afford a new car.
They are to daft to realize the extra money is only here for a few months of that 72 month loan.

[Matt Monson]

Originally Posted by 1979-930

I think it goes back to the fact most Americans suck at managing money.
You have all these people that are now pulling in $1,100.00 a week and think they can now afford a new car.
They are to daft to realize the extra money is only here for a few months of that 72 month loan.

You highlight another problem. 72 month loan? no credit arseclowns used to get 48 or 60 month loans. The rest of the world car loans were 2-3 years, sometimes 4. The idea of paying interest that long is beyond me.

[1979-930]

Originally Posted by Matt Monson

You highlight another problem. 72 month loan? no credit arseclowns used to get 48 or 60 month loans. The rest of the world car loans were 2-3 years, sometimes 4. The idea of paying interest that long is beyond me.

Let's not forget the 20 somethings with their 72 month truck loan pulling their 180 month Wakeboard Board Boat loans.
But they are COOL AS EFF at the lake bro.

[tirwin]

Originally Posted by 1979-930

Let's not forget the 20 somethings with their 72 month truck loan pulling their 180 month Wakeboard Board Boat loans.
But they are COOL AS EFF at the lake bro.

Don’t get me started. I did a lot of stupid crap when I was in my 20s. I just wish my 20-something me knew what I know now... that may look good but nothing beats not having debt.

I tell my kids all the time they can choose to work for themselves or a bank.

[Alan A]

Originally Posted by Matt Monson

You highlight another problem. 72 month loan? no credit arseclowns used to get 48 or 60 month loans. The rest of the world car loans were 2-3 years, sometimes 4. The idea of paying interest that long is beyond me.

Last two cars - daily drivers - I bought new were 60 month loans. I usually lease, but when they’ll roll in the taxes into the total and give you 0.0% APR on 108% of the sales price there really isn’t much incentive to pay cash for anything.

If they’d offered 72 months I’d have taken that. Still only kept one of the cars 2 years and the other for 3, but wasn’t paying much for them.

It’s not the duration, it’s the APR that kills you.

[tirwin]

I think I’ve bought 2 new cars in my life. Last one was 0% APR. You’re right, no incentive to pay up front.

I try to buy used cars to let someone else pay for the bulk of the depreciation.

Porsche CPO is interesting. Whatever time or 50k miles is left on the original warranty gets extended another 2 years and unlimited miles.

[tirwin]

Originally Posted by Alan A

Last two cars - daily drivers - I bought new were 60 month loans. I usually lease, but when they’ll roll in the taxes into the total and give you 0.0% APR on 108% of the sales price there really isn’t much incentive to pay cash for anything.

If they’d offered 72 months I’d have taken that. Still only kept one of the cars 2 years and the other for 3, but wasn’t paying much for them.

It’s not the duration, it’s the APR that kills you.

And the depreciation.

We’re moving out of the kid-hauler phase of life. We’re passing the Highlander on to my son for his first car. Getting a “new to us” car for my wife. She doesn’t like sitting down low in a sedan anymore. She hates the truck-like driving experience of most SUVs.

She wanted to check out a MINI Countryman. Holy crap — after year 3 those things fall off a cliff. She drove our friends Macan GTS the other day and — through gritted teeth — admitted that it was awesome to drive. Could’ve knocked me over with a feather.

I know there is a big initial drop off but in most cars — Macan included — but it seems that the Porsches don’t approach zero quit so fast.

It looks like low mileage ‘17-‘18s Macan S are in the mid 40s and base models are in the high 30s.

I was doing some reading that suggested that dealers were thinking this would be a big year for used car sales and weak new car sales. Recent data suggests the reverse is happening and dealers are worried they are sitting on too much inventory that won’t move. A theory is that the manufacturers are sweeting the deals on new cars to keep manufacturing up.

I don’t have any answers. Just trying to figure out the market.

[ShopCat]

Who cares about 2 or 3 percent interest when buying new you've accepted 50% depreciation over those 60 months? All the people using the 0% 72 month deals to justify buying a car they can't afford in the first place, so many are going to be stuck underwater and won't even realize it until they want something new in 3 or 4 years.

But Iv'e seen people roll that balance into the next new car loan, guaranteeing their eventual garnishments. Saw someone do that and essentially pay $40k for a $28k Hyundai. Guess how that ended.

[tirwin]

1/3 of new car loans are longer than 6 years. That is up from 10% over a decade ago.

https://www.wsj.com/articles/the-seven-year-auto-loan-americas-middle-class-cant-afford-their-cars-11569941215

This article states that dealers are making more money off the loans than the cars they sell. I heard recently from a friend that if you’re paying cash at some dealers, they aren’t as accommodating. There is apparently no shortage of people who are willing to pay more through dealer financing. (that was pre-coronavirus)

[tirwin]

Interesting quote in this article:

“The seasonally adjusted annualized sales rate is expected to tumble to 7.5 million to 7.7 million, according to forecasts. That would be the lowest sales pace in more than 40 years — it hit 8.8 million in December 1981 during a double dip recession, according to Cox. For comparison, during the Great Recession, the SAAR hit a low of 9.05 million in February 2009.”

https://jalopnik.com/car-sales-are-somehow-getting-even-worse-1843196407

[tirwin]

This article from a month ago hits on my original question. Stops short of really answering it though.

Am I crazy for thinking they’d rather have some business rather than no business? Sure they don’t want to lose money on a car but they’re also sitting on inventory.

https://jalopnik.com/why-are-dealers-still-insisting-that-i-negotiate-in-per-1842791873

[Matt Monson]

Originally Posted by Alan A

Last two cars - daily drivers - I bought new were 60 month loans. I usually lease, but when they’ll roll in the taxes into the total and give you 0.0% APR on 108% of the sales price there really isn’t much incentive to pay cash for anything.

If they’d offered 72 months I’d have taken that. Still only kept one of the cars 2 years and the other for 3, but wasn’t paying much for them.

It’s not the duration, it’s the APR that kills you.

You don’t have a fico score in the 500s, like an NCAC. For them it’s about the monthly nut. They don’t even understand interest rates. They get sold a monthly payment.

[tirwin]

You know... when you think about it... the only monetary policy that the Fed cares about is free cash flow to the millions of Americans who are willing to increase their debt load. Credit flows freely, prices are going up, wages are not. We’ve learned nothing.