Price of new trucks way above the economic recovery rate

[monkey44]

If you 'casually' watch truck prices, we see a gradual increase over time.

Was once pretty easy to ask a salesman "How much difference between last year and this year." Answer: "Oh, couple hundred bucks." A truth maybe in base price - although not that low in reality. But not such a jump that it seemed outrageous.

Then suddenly, a few large jumps, like $5000, and at the same time, all the ads giving $5000 off. Then the prices eroding the "Off Factor" as the prices really did jump that high... and the "Oh, a couple hundred bucks." Still the same answer, but the discounts much lower, means the truck 'seems lower' but in fact isn't.


For, example, when you look at a 2500 GMC in 2003 at well under $30k, and then look at the COLA since that time frame, about 12.8% combined, we see a price increase in fact of over 28%% combined, makes you wonder about value for the bucks.

GM saved a ton of money cutting off payouts, and cutting down a lot of union benefits for retired GM employees, but it sure doesn't reflect that in the selling prices.

SO, it always makes me wonder where all that sales money goes, and where that buyer money comes from - when all of the buyers make 13.8% more money over ten years (and 1% on savings accounts) but the price of vehicles MSRP jumps over 25% ...

Most recent dealer quote I got (couple months ago, local) was $39k on a $46k list = on the lot and not equipped well). So, even with the 'great deal' that's still about a 30% increase in numbers, and when we adjust for 'inflation' ... still 20.2% jump in real dollars.

So would like those folks that adjust those numbers to send it to that person who writes my check, so I can afford to go down and pick out one of those pretty awesome new trucks ... soon as GM releases that Double Cab in the 2500HD 🙂 🙂 🙂

[Francesca_Knowl]

monkey44 wrote:

Who said anything about payments - I'm talking about price - period.

And if I sell/trade my truck, what does that have to do with the price, the price is the price ... and it's increased at a faster rate than everything else, including all those "value-less" dollars the feds print. If they're so value-less, just give some extra to me in the form of a check, or even cash will do.

This is the U.S.of A.- and you're right...the price is the price.

Thing is, in this our much-worshiped "whatever the market will bear" economy, "the price" is based on the market.

Which market seems to me to be perfectly willing to pay big upcharges for faux-leather seats, built-in GPS systems, raised-letter tires, and whatever other frippery that we're quite willing to believe to be essential to what used to be simple modes of transportation.

On t'other hand...they gussied up pickup-type trucks they be puttin' out these days sho' is purty! 🙂

[monkey44]

travelnutz wrote:
If you'd saved up the money to buy your new truck along with the money recieved for your trade or outright selling of your present truck, you'd have NO payments! As in ZERO! Also would have collected some intrest on the saved money along the way and would not pay out any money for interest with payments for years that you wouldn't have.

Problem solved!

Money has time value!

Who said anything about payments - I'm talking about price - period.

And if I sell/trade my truck, what does that have to do with the price, the price is the price ... and it's increased at a faster rate than everything else, including all those "value-less" dollars the feds print. If they're so value-less, just give some extra to me in the form of a check, or even cash will do.

My point, vehicle sales prices increased much faster than our pay checks ... so, where does that value fall into the economic engine that drives our recovery? That's what I'm wondering ...

And some of the answers here don't address that, like trade and save money. SO,if I trade and save money, does that mean the truck cost less? And the trucks need less equipment in Mexico, so they sell for less. What does that have to do with truck price in USA?

[monkey44]

Francesca Knowles wrote:

monkey44 wrote:

For, example, when you look at a 2500 GMC in 2003 at well under $30k, and then look at the COLA since that time frame, about 12.8% combined, we see a price increase in fact of over 28%% combined, makes you wonder about value for the bucks.

Ya know what? I just looked, and either your math is off or I'm missing some important detail.

$30,000.00 in 2003 is $38,000.00 in 2013 dollars, according to the adjust-for-inflation calculator at this link.

MSRP's for the 2014 (one year newer than 2013) GMC 2500 PU begins at $32,000. Link
Even assuming that folks'll want a bunch of upcharge bells and whistles, I don't see the huge out of bounds increases you seem to.

What am I missing?

Francesca: Well, you're missing the price I paid for my 2500 4x4 GMC in 2003 and the price I was quoted for a "similarly equipped" 2014 at the dealer last month. Those are the actual numbers I used, not the 'fantasy numbers' we all can see in the ads ... Ever seen one in a dealer lot for the price you see on the ads? And, lease, same way. That 'quote' is for a bare-bones work truck that no one wants or buys.

My 2500 GMC truck cost me just under $28,000 in 2003, but when I went to the dealer, the price for 2500HD was $46,000. But, the dealer will give off price to $39,800, and the equipment is less than in my original truck in 2003. This 2014 truck had bench seat (Buckets = $1200 option in mine) and minimal radio/mp3player, where mine has upgrade = $1000 for 6CD and Bose, top of the line at that time.

So, the prices are a bit out of line with other components of our economy - that's the only point I'm trying to make here. When we look at truck prices, I just drop my jaw ...

[old_guy]

The most I have ever paid of a new truck or car was $500 over invoice. make the offer, if they say no then walk. there are dealers out there that sell for that price every day. they still make good money at that price. You just want to buy a truck, not the dearship

[bigdogger]

I must have missed the new law that says the price of trucks can only increase at a rate equal to the inflation rate. They price them high because customers will pay the price. It upsets me greatly, but the feel and smell of a new truck quickly soothes the pain.

[ScottG]

It's not just new trucks, check out what used ones go for.

[travelnutz]

If you'd saved up the money to buy your new truck along with the money recieved for your trade or outright selling of your present truck, you'd have NO payments! As in ZERO! Also would have collected some intrest on the saved money along the way and would not pay out any money for interest with payments for years that you wouldn't have.

Problem solved!

Money has time value!

[45Ricochet]

Pickup trucks accounts for a very large part or maybe the biggest part of the manufactures bottom line or profit. Record sales right now, they must be priced right or they wouldn't be selling. I hear you though, I read the new Ram 1500 Ecodiesel was going to list at like $57K :E Cha ching!
Luckily I don't have a need for a new TV or that payment.

[fla-gypsy]

The difference is everyone wants a lot of fluff in their trucks now which drives up the cost.

[camperforlife]

donn0128 wrote:
Add in the outrageous government regulations imposed on the auto makers that have taken effect in the last 10 years or so and it is quite understandable how the prices have jumped so dramatically. And this is only the start.

Not completely true. Many of the identical new vehicles are sold in Mexico and further south without many of those US mandated items like air bags, ant-locks, traction control etc at a higher retail than in the US. Strange but true.

[skyhammer]

The important fact you are missing is that the Fed has printed trillions of new dollars with little economic growth to absorb those new dollars.Therefore the these new dollars are worth a lot less. Add inflation to that figure and it takes a lot more dollars to purchase something of the same value now compared to 2003.
Just look at interest rates, interest rates reflect the price of money, low interest rates mean our dollars are worth less.

[Francesca_Knowl]

monkey44 wrote:

For, example, when you look at a 2500 GMC in 2003 at well under $30k, and then look at the COLA since that time frame, about 12.8% combined, we see a price increase in fact of over 28%% combined, makes you wonder about value for the bucks.

Ya know what? I just looked, and either your math is off or I'm missing some important detail.

$30,000.00 in 2003 is $38,000.00 in 2013 dollars, according to the adjust-for-inflation calculator at this link.

MSRP's for the 2014 (one year newer than 2013) GMC 2500 PU begins at $32,000. Link
Even assuming that folks'll want a bunch of upcharge bells and whistles, I don't see the huge out of bounds increases you seem to.

What am I missing?

[sh410]

According to the Bureau of Labor and Statistics the buying power of $1.00 in 2003 has the buying power of $1.27 in 2013. 27%?

At this link

[carringb]

So are you saying GM should go back to selling vehicles at a loss?

Besides, look at everything the new trucks have to offer. If you compare a bare-bones fleet truck, I don't think prices have gone up all that much.

[Francesca_Knowl]

In my opinion, "MSRP" is as much an advertising gimmick in the car-buying world as it is in the RV-buying world.