Muda69 wrote:
http://www.nbcnews.com/business/consumer/out-gas-most-americans-cant-afford-new-cars-n58876
For many Americans, new cars are driving out of reach.
Jose Hernandez, 24, lives in East Los Angeles and makes $26,000 a year working the front desk at a clinic. After trading in his previous car with $6,000 in negative equity, he financed a 2013 Civic EX for $25,000 at 2.3 percent for 6 years, paying $379 in monthly payments, plus $100 per month in insurance. He finds a new car can be a stretch.
"I believe most cars are slightly out of reasonable price range for the average American, especially considering most 'affordable' cars don't last very long and lose a lot of value rather quickly," he said.
A car isn't a way to get from point A to point B, it's freedom. The promise of an automobile goes beyond the thrill of the open road or being able to get a late-night pint of ice cream when you want. With a car, you've arrived. And with a car, you can always leave. Social mobility, a new life in a new town, used to be just a black ribbon of interstate away.
Now, amid stagnant wages and a shaky recovery, the average new car price rose last year by $1,536.
"Americans can only afford used cars," said Louis Hyman, an assistant professor in the labor relations, law, and history department at Cornell University. "The recovery has only been for those at the top and not for normal Americans."
...
It's an aspiration that's slipped from the grasp of most, as a new report finds the average new car unaffordable for the average American family in 24 of the 25 largest U.S. metro areas.
Except for Washington, D.C., median-income households in those areas fell shy of the $32,086 in annual salary required to buy an average new car, the Interest.com analysis found.
Experts recommend using the "20/4/10" rule when financing a new automobile. That is, buyers should put put 20 percent down, with a loan term of no more than four years, and spend 10 percent or less of their monthly income on car expenses. Failing to do so can put their budget in peril.
"The consumer gets to the end of the month and discovers they have no money left in their checking account," said Interest.com managing editor Mike Sante. "They’ve spent every cent they have and wonder how on earth they’re supposed to save for their retirement or their kids’ education."
...
Recent studies show that since the start of the recession, teens are increasingly waiting longer to get their licenses. And of the members of "Generation Y," those born 1977-1994, with no plans to buy or lease a car, 80 percent say they can't afford it.
....
Sounds like a slow downward spiral for automobile manufacturers. Who will be able to afford their products beside the 1%?
The government...and Hertz.
Statistics: Posted by imzhammer — Tue Mar 25, 2014 11:02 pm