CNBC Marathon examines a variety of factors that lead to car ownership in the U.S. being so expensive, from auto loans to repairing your vehicle.
A car loses about 10% of its value as soon as it’s driven off the lot. And within the first three years, that number goes up to 50%. Depreciation — the rate at which that happens — is one of those numbers everyone in the automotive world thinks about including consumers, automakers and the massive used car market, which made up somewhere around 35.2 million in 2022 — compared with 13.8 million new cars.
More than 100 million Americans have an auto loan and auto loan debt in the U.S. is at a record high of $1.56 trillion. Between the Covid-19 pandemic, supply chain issues, alleged predatory lending practices, inflation, and the Federal Reserve’s interest rate hikes, getting an auto loan is getting increasingly difficult and costly.
Auto repair costs have been rising for years, but recently they’ve spiked. Experts say it’s likely a mix of factors including heavier, faster and more complex vehicles, riskier driving behavior, new technology, and labor and supply shortages. Repair shop owners say they can’t find enough technicians despite paying six-figure salaries. As technology marches forward, and fancy cutting-edge EVs fill the roads, consumers hear horror stories about huge repair bills. But insiders say there are reasons to be optimistic.
Chapters:
00:00 Introduction
00:32 Why Cars Lose Their Value So Fast (Published December 2023)
13:18 Why Americans Are Falling Behind On Car Loans (Published August 2023)
30:30 Why Car Repairs Are Getting So Expensive (Published February 2024)
Produced by: Robert Ferris, Emily Lorsch
Edited by: Darren Geeter
Animation by: Christina Locopo, Jason Reginato, Alex Wood
Additional Camera by: Ryan Baker
Senior Managing Producer: Tala Hadavi
Additional Editing by: Jack Hillyer
Additional Footage: Getty Images, Rivian, Kia, Tesla, Insurance Institute for Highway Safety
Additional Sources: Experian, Bankrate, Federal Reserve Bank of New York
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Why Car Ownership Is Getting So Expensive | CNBC Marathon
Author: CNBC
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News post in July 3, 2024, 6:04 pm.
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