“It’s kind of scary, but it’s amazing"
May 16, 2018 8:41 AM   Subscribe

With auto loan delinquency rates now higher than during the 2008 financial crisis, many Americans may soon be facing a new, higher tech repo man. (wapo link, may need to open in incognito mode)
posted by selfnoise (89 comments total) 21 users marked this as a favorite
 
“So much of America is just a heartbeat away from a repossession — even good people, decent people who aren’t deadbeats,” said Patrick Altes, a veteran agent in Daytona Beach, Fla.

Because the basic test of being a good and decent person is not being late on your auto loan payments.

This is fine.
posted by grumpybear69 at 8:48 AM on May 16 [68 favorites]


I'm a member of a teacher's credit union, which has been an awesome bank for me for the last 20 years, and always seems totally member-focused... but for the past 5 years or so I've had a standing pre-approval of $50,000 for an auto loan, which is just totally insane. I can't afford a $50,000 car loan. My current car was half that price, and I feel fine about the payment, but I'd never go over $30k. And that's a credit union...
posted by Huck500 at 8:59 AM on May 16 [6 favorites]


Huck, that reminds me of when my credit union one day just raised this little never used credit card (my first! $200 limit, ha) up to $15,200. If I wanted to I could just go $50,000+ in credit card debt no problem. That seems... problematic.
posted by OnTheLastCastle at 9:01 AM on May 16 [11 favorites]


Big banks have become relatively conservative in this category and are sticklers for things like income verification and other details, which has made room for specialty lenders with fewer such compunctions.

...

These lenders generally borrow from big banks to fund auto loans to subprime customers. The difference between the rates big banks charge those lenders and the rates those lenders obtain from their subprime customers (often in the double digits) is their margin.


That makes no sense at all. Banks won't lend to risky consumers, but will knowingly lend to another company that turns around and lends to those risky consumers ? On what, the companies good word they'll pay the bank back ?
posted by k5.user at 9:04 AM on May 16 [1 favorite]


Banks will lend in volume to smaller lenders on the assumption that smaller lenders' markup will be sufficient to cover the increased losses plus a profit.
posted by at by at 9:09 AM on May 16 [5 favorites]


The car might be gone, the missed payments and repo fee too much to make up, but she could get her items back for $50.

I'm sorry, what? How is it possibly legal to make someone pay to recover their belongings? That is straight-up theft.
posted by god hates math at 9:12 AM on May 16 [22 favorites]


Well, now I know what those little boxes I’ve been seeing on police cars all around town are. The panopticon keeps growing and growing.
posted by TedW at 9:17 AM on May 16 [2 favorites]


asset backed securities

Time is a flat circle.

Securitisation of assets strips out the risk management and due diligence from the originator.
They ultimately don't care as much about your ability to repay as the loan doesn't stay on their books and its sold in the market to the yield hungry. This isn't inherently bad. It means a bank is taking less risk and more risk/return thirsty hedge fund can. That said since much less leverage involved than real estate, prob not a systemic issue.
posted by Damienmce at 9:18 AM on May 16 [3 favorites]


god hates math: "I'm sorry, what? How is it possibly legal to make someone pay to recover their belongings? That is straight-up theft."

It's undoubtedly in the finance agreement signed when they bought the car.
posted by Mitheral at 9:23 AM on May 16


The big question is: once the cars are autonomous, they will obviously just drive away from you the moment you are too late with the loan payments (if ownership is still a thing then), but will it be legal for them to drive away, even if you are still inside?

I mean, by then, it will be normal to sleep in your car, right?
posted by Laotic at 9:30 AM on May 16 [31 favorites]


Ahhhhh, the actual unspoken monitization of the autonomous vehicle, don't pay it drives away.
posted by sammyo at 9:30 AM on May 16 [4 favorites]


Yeah, what Laotic said.
posted by sammyo at 9:31 AM on May 16 [1 favorite]


Time is a flat circle.

What other kinds of circles are there?(NB: A circle on a sphere is flat when you consider what flatness means relative to a sphere).
posted by thelonius at 9:40 AM on May 16 [5 favorites]


don't pay it drives away

On the upside, that's a slightly snappier slogan than "no more to pay, drive away".
posted by flabdablet at 9:44 AM on May 16 [2 favorites]


Every single person quoted in that WaPo article is an infuriating trash bag of a human. I can't pick out which one is making me the most angry. I hope they all experience lives filled with misery, similar in tenor to what they inflict professionally.
posted by protocoach at 9:44 AM on May 16 [6 favorites]


The privacy issues here are pretty staggering. Number of plates, selling to law enforcement, and who knows who else.
posted by nat at 9:49 AM on May 16 [4 favorites]


A “black ice” air freshener and knickknacks dangled from the rearview mirror.
Find one in every car. You'll see.
posted by flabdablet at 9:50 AM on May 16 [18 favorites]


With autonomous cars, in general, "we" won't own the cars. Waymo/Uber/Car2Go will own the autonomous vehicle and pick you up and drop you off as necessary.
posted by GregorWill at 10:03 AM on May 16 [5 favorites]


Yeah, I see an endless car payment into a subscription service in our future. CaaS! Gross.
posted by selfnoise at 10:06 AM on May 16 [2 favorites]


GregorWill, that's one possible model. There'll still be ownership.
posted by Laotic at 10:06 AM on May 16


Yeah, I see an endless car payment into a subscription service in our future. CaaS! Gross.

Already here.
posted by briank at 10:09 AM on May 16 [4 favorites]


With autonomous cars, in general, "we" won't own the cars. Waymo/Uber/Car2Go will own the autonomous vehicle and pick you up and drop you off as necessary.
posted by GregorWill at 2:03 AM on May 17 [+] [!]


Which I wholeheartedly support. Honestly, it's much easier to demand reasonable public access and levels of service from a few competing utility-like companies that buy cars in fleets than as a big-ticket lease-to-own purchase that can be taken away at any moment.

Until autonomous car rental/ride-share services turn into vertically integrated monsters resembling the local cable monopoly.

We're fucked either way aren't we?
posted by saysthis at 10:09 AM on May 16 [1 favorite]


The big question is: once the cars are autonomous, they will obviously just drive away from you the moment you are too late with the loan payments (if ownership is still a thing then), but will it be legal for them to drive away, even if you are still inside?

I mean, by then, it will be normal to sleep in your car, right?


Nah, I fully expect they'll work language into your contract agreement that you cannot sleep in your car. Soon thereafter they'll put sensors in the car that will detect if you stay in it too long when parked and eject you from it.

There's really no end to the inventive monetization options.
posted by tocts at 10:21 AM on May 16 [4 favorites]


I understand that it's all out in the public, but there has to be something illegal about tracking someone's comings and goings and selling it to a third party, right? Even if it's done en-masse by a repo company and sold to the police?

This just seems like it shouldn't be legal. People have a right to privacy, and if an individual were tracking you like that, it'd be called "stalking."
posted by explosion at 10:25 AM on May 16 [5 favorites]


This isn't inherently bad.

Yes, yes it is.
posted by praemunire at 10:25 AM on May 16 [1 favorite]


I understand that it's all out in the public, but there has to be something illegal about tracking someone's comings and goings and selling it to a third party, right? Even if it's done en-masse by a repo company and sold to the police?

This just seems like it shouldn't be legal. People have a right to privacy, and if an individual were tracking you like that, it'd be called "stalking."


Have you heard about these phones people carry around? You can even try it on yourself.
posted by Nonsteroidal Anti-Inflammatory Drug at 10:31 AM on May 16 [2 favorites]


Every time a news outlet posts something about auto loan default rates, internet economists proclaim that the sky is falling.

According to the NY Fed, for Q4 2017 the rate was 2.4%

For comparison, student loan debt was 9.6%, credit cards were 4.6%.

Starting Q1 of 2017 and accelerating in Q1 2018, the number of subprime originators shrank substantially and loan requirements increased as well.

In other words, the brakes started getting applied a year ago, but it takes time for that to start showing up in the quarterly and yearly stats.

The big lenders have already started to significantly tighten their loan requirements, which is part of the reason why auto sales have been plateauing.

My point in saying all of this is that the auto market is incredibly different from the mortgage industry in 2007/2008. I'm not worried about this leading to a crash.

What I am concerned about is the rapid increase in new vehicle transaction prices greatly outstripping similar increases in income. Inevitably, the auto industry is going to hit a sales wall where consumers are over indebted and the banks have tightened to the point where people will have little choice but to "buy down".

The risks are bigger for the automakers than the financial institutions: subprime borrowers are rolling a *lot* of debt from one loan to the next, but even this is becoming much more difficult. The result is that consumers will need to hold on to these cars longer and automakers will sell fewer new cars.

Unlike the mortgage industry, which had nitroglycerin thrown onto it by financialization, the auto and auto loan industry is better equipped to find equilibrium faster. In addition, the automakers are significantly more lean and efficient than they were in 2008, and the data has proven that people will walk away from a home well before they will walk away from a car.

TLDR: stop buying such expensive damned cars, everyone!
posted by tgrundke at 10:36 AM on May 16 [13 favorites]


stop buying such expensive damned cars, everyone!

Please don't take this advice. If none of you are willing to pay the $10,000 it costs to drive a new car down the dealer's driveway, I'll eventually run out of good cheap second-hand options.
posted by flabdablet at 10:52 AM on May 16 [16 favorites]


Gotta love the framing (emphasis mine):
Technology has made the repo man ruthlessly efficient, allowing this familiar angel of financial calamity to capitalize on a dark corner of the United States’ strong economy: the soaring number of people falling behind on their car payments.
Yeah, right. There's no better indicator of a strong economy than soaring loan defaults.
posted by mondo dentro at 11:00 AM on May 16 [7 favorites]


Of course, student loan defaults are almost **4 times** the rate of auto loan defaults - and you cannot discharge them.

Verizon, AT&T, Sprint and T-Mobile will turn your service off if you don't pay your bill - automakers will repo your car if you fall too far behind, and mortgage lenders will repo your house.

None of this should be surprising.

Debt is a noose around your neck, waiting for you to trip.
posted by tgrundke at 11:04 AM on May 16 [10 favorites]


So much can be explained by the $5 foot-long campaign with Subway. This catchy little campaign did increase the purchase of $5 sandwiches from subway, but mostly it reset people's expectations and resulted in an increase across all theie product categories.

Similarly, if you can afford a 5K shitbox, and I give you 10K in credit, you still buy the 5K shitbox...
But, if I give you 25K in credit, you get a 20K brand new car you are being 'financially responsible'. That in and of itself doesn't screw you over... instead since every company is making the same offer to you about your cell phone, your credit cards, your store credit... every one of these results in you being completely upside down. What might have been an 'OK' thing as your only exuberance... has now snowballed out of control and the economic reality is obfuscated behind the offer personalization algorithm...

So... everybody buys everything and then fucks their credit in a similar vein to a private equity dump - except with cars and phones there is only asset depreciation - so there is even less worth than what happens with a company...
posted by Nanukthedog at 11:12 AM on May 16


If I were foolish enough to get into a business where I lend people money to buy an asset that depreciates by 25% the moment it leaves the dealership, and rapidly afterwards, you better believe I'd look to seize those assets back as quickly as possible if a borrower fell behind.

The repo men are not the problem. The fact that in some parts of the country you cannot live decently without one of these expensive self-destructing two ton suits of armor is the problem.
posted by ocschwar at 11:16 AM on May 16 [16 favorites]


Yeah, the privacy ship has sailed. It's been the norm for quite a while that lenders can remotely lock your engine if you've missed a payment.
posted by Melismata at 11:23 AM on May 16


ocschwar -

Some nuance is needed here: if you really dig into the data, the problem isn't that people need cars, the problem is that there are many consumers who do not understand that a want is different from a need. A large percentage of those falling behind on payments aren't destitute, they just took on a larger car payment then they responsibly should have.

There are plenty of affordable, responsible transportation options available on the market. The issue is that there is a segment of the population that doesn't understand that there's a difference between being able to purchase something....and being able to responsibly afford it.

I know plenty of individuals driving cars waaaaaaaaaay above their pay grades. Some of these individuals make nice livings, many of them are just scraping by. Those who I know who are most successful financially are those driving 10 year old econoboxes.

Life is all about trade-offs. Educating youngsters on financial management would go a long way toward curbing the debt binge. Too many people buy new cars "because they want something new" without thinking of the downstream consequences.
posted by tgrundke at 11:36 AM on May 16 [6 favorites]


by then, it will be normal to sleep in your car, right?

Been to a walmart recently?
posted by Alter Cocker at 11:40 AM on May 16 [5 favorites]


Credit card companies don't make their money off of people who always pay their bills. They also don't make their money off of people who never pay their bills, and then the debt gets sold for 23 cents to the dollar to a collection agency.

They make money off the subset of people who reliably pay their debts, but at some point get in trouble. So their job, their way to make the shareholders happy, is to help reliable people get in financial trouble.

The strategy to do this makes sense to me:

1. Identify target (reliable but likely to be in financial trouble in the future)
2. Offer target 5% cash back
3. Ramp up credit limit while waiting for target to lose job
4. When target loses job, don't nag, just lend them money to maintain lifestyle
5. When target tries to consolidate debt, tell target sorry, you have no job (IMPORTANT: Do this for targets of other companies too. Solidarity works!)
6. Wait until target finds job and starts paying you back with 18% interest plus ridiculous fees.
7. Cash bonus check

I mean, I can't even bring myself to feel judgmental about this. It's a totally valid strategy, when you're trapped in Ronald Reagan's brain on some industrial stimulant. But it's the government's job to prevent these kinds of degenerated states of markets, and the CFPB is run by a dude who doesn't think it should exist.
posted by kleinsteradikaleminderheit at 11:46 AM on May 16 [16 favorites]




A friend of mine was in a rough spot, living in an abusive situation and needing a car to move out but had horrible credit, so I helped drive him to the usurious used car lot for people in such situations. I don't recall the interest rate but it was mind-blowing, well into double digits. The car had some hardware installed that would disable it if he became late on payments. It ought, I thought, to at such a time play the audio from the Goodfella's scene - "fuck you, pay me" He managed to get back on his feet financially.
posted by exogenous at 11:50 AM on May 16


kleinsteradikaleminderheit -

That's a pretty simplistic and Fisher Price way of viewing how finance works.

Does the scenario you outlined happen? Yep.
Is it some SPECTRE-esque plot to enslave everyone? Nope.

The reality is, the *vast* majority of profit made on credit cards is made by people who carry relatively minor balances month to month. The credit card companies also charge transaction fees to merchants.

Let's say I carry enough of a balance to pay $25/mo. in interest. That's $300.00 per year. Multiply that by 1mm individuals and you're talking $300 million annually in interest, not counting transaction fees.

No doubt there are plenty of individuals who are buried in credit card debt, but to think that there is some plot by the companies to crush everyone is just silly.
posted by tgrundke at 11:59 AM on May 16 [5 favorites]


Canada's household debt to GDP ratio is the one that worries me. 71% in Q1 2006 and 101% now.
posted by Glomar response at 12:13 PM on May 16


I have found another industry that gets no solidarity from me.
posted by corb at 12:22 PM on May 16 [2 favorites]


I don't know tgrundke, obviously you cannot "crush everyone" but there is plenty of energy that goes into predation when it comes to consumer finance. I mean you can imagine that the goal isn't to ruin people but the incentives might be encouraging that as a byproduct. I mean you can argue that lousy prepaid debit cards and payday lending aren't about plots to crush people but are just ways of providing services to unbanked customers but it looks kind of like the same thing. It's not like my credit card is offering me interest free cash because it doesn't want a taste of usurious interest rates if I cannot pay it back.

What I really find remarkable is that people go along with paying. I know at least two people who just walked away from substantial credit card debt (6 figures) without a qualm. I feel like personal finance depends on most people acting like they have a relationship with a bank as they would with a person while the bank doesn't /cannot have a relationship that is anything but exploitative. The old "money talks bullshit walks/tear their face off" kind of phraseology is not something dreamed up by critics of finance after all.
posted by Pembquist at 12:24 PM on May 16 [1 favorite]


Credit card companies don't make their money off of people who always pay their bills.
They actually make plenty of money off people who always pay their bills, which is why they offer discounts (like airline miles or cashback stuff) for using the cards - to convince people to use them more. 35% of card users don't carry a balance, which is pretty significant. There are processing fees that they pocket on every transaction, approximately 2% of purchase price in most cases.
posted by The_Vegetables at 12:28 PM on May 16 [13 favorites]


Don't disagree Pembquist - there is a ton of predation, and many throughout history have warned about the dangers of finance and banking ("Banks are more dangerous than standing armies").

Too much of anything can be a bad thing. Finance is no different.

If you want to turn the tables on the financiers, remember this adage: "When you own the bank $1,000 - it's your problem. When you owe the bank $1,000,0000,000 - it's the bank's problem."
posted by tgrundke at 12:30 PM on May 16 [1 favorite]


Yeah, I see an endless car payment into a subscription service in our future.

Well that's essentially what a lease is, except for the endless part. You rent a car for 3 years and at the end of the lease you have the option to buy it.
posted by MiltonRandKalman at 12:32 PM on May 16 [1 favorite]


The car had some hardware installed that would disable it if he became late on payments.

Sometimes I feel like 95% of modern problems would be solved if we had just taken to heart the lessons of '80s dystopian sci-fi. (Alien, Terminator, Robocop, etc.)
posted by jcreigh at 12:41 PM on May 16 [1 favorite]


Yeah, I see an endless car payment into a subscription service in our future. CaaS! Gross.

Already here.


I mean I can't afford to drive a new Volvo, but I would definitely "subscribe" to a modestly-priced Chevy in the same way, given a reasonable price. I can even imagine a "10 year old econobox" version of this. You would think that there would be legitimate economies of scale in repairing/maintaining/insuring a fleet rather than just a single car which might make it price-competitive or cheaper than maintaining your own car in some situations.

If the auto companies themselves got into this business (perhaps along with the Uber-style "rideshare" business), it would also fix their bizarre incentives to come out with new-and-shiny vehicles as often as possible and encourage people to ditch the old ones. Sure, there would still be people that always wanted a new car, but engineering vehicles for efficiency of servicing in a fleet could lead to less waste. Imagine Chrysler engineering the next 200 so that it will still be a viable fleet vehicle (and thus keep earning them nickels) in 10 years: ease of maintenance becomes huge, as to swappable systems like the stereo and instrument cluster, to make it possible to "refresh" an existing car, rather than building a new one, etc.
posted by LiteOpera at 12:42 PM on May 16 [2 favorites]


There are plenty of affordable, responsible transportation options available on the market.

If you mean "get a used car," I'll just point out that the less car you can afford, the less you can afford to miss a shift because your rattletrap used car broke down on the morning commute. I won't poor shame anyone for paying extra to be sure to get to work on time.

There are people out there who really do buy too much car in order to show off status (the mentality behind it baffles me. I have nothing to prove to people who get a glimpse of me at 35 MPH, and they have nothing to prove to me. Warren Buffet agrees, which is why we both have about as much car.) But is that really what's happening? Fancy cars generally don't have a repo button.
posted by ocschwar at 1:10 PM on May 16 [10 favorites]


stop buying such expensive damned cars, everyone!

Please don't take this advice. If none of you are willing to pay the $10,000 it costs to drive a new car down the dealer's driveway, I'll eventually run out of good cheap second-hand options.


But the thing is that I can get anywhere between 3.49% and 0% financing for a new car, fully covered by warranty, guaranteed (well, as much as you can guarantee) not to have ever been in an unreported accident, not to have been poorly maintained, not to have had the odometer fucked with, not to basically have anything wrong with it. But if I want a used vehicle I'm looking at anywhere from minimum 5% financing up, and if I want to buy a dealer-certified vehicle it usually isn't significantly lower in price than something new, but I'll have a shorter term on a higher interest loan and little or no warranty. If I buy something cheap enough to pay cash, it's going to be at least 10 years old from some shady dealer and I don't know enough about cars to know if it's going to die on my way home from the lot.

If I'm not going to trade it in after 5 or 6 years, it's probably cheaper and easier for me just to just buy a new one.
posted by windykites at 1:23 PM on May 16 [8 favorites]


My minivan was repossed on Friday and I had to fundraise to rescue it because my life is such a precarious balancing act of survival that the loss was catastrophically disastrous. You cannot be a single parent of a disabled kid without a car. It's near impossible. Man, walking out to put my kid on his bus and having him point to the empty spot just gutted me.
posted by 80 Cats in a Dog Suit at 1:32 PM on May 16 [19 favorites]


You can even try it on yourself

Interesting - their guess was WAY off, like by a good 10 miles, using cell-tower locating. I'm surprised; I have Location turned off most of the time (only time it's on is when I'm using GPS while driving) and I have most apps firewalled and/or permissions locked down pretty tight, but even so I assumed passive cell tower tracking would have me reasonably pinpointed anyway.
posted by Greg_Ace at 1:50 PM on May 16


Yeah, the privacy ship has sailed. It's been the norm for quite a while that lenders can remotely lock your engine if you've missed a payment.

The privacy implications of just remote bricking the car, versus tracking every license plate in some region, are vastly different.

In the second case, these repo trackers are not only capturing plates of people who are behind on their payments. They aren’t even only tracking people with car loans. They are tracking everyone.

And actually it’s worse than tracking everyone, they are disproportionately tracking people in low-income situations, based on where they live or work. The potential for bias of what plates they pick up, including of people who are not involved in the car loan system in any way whatsoever, is huge.
posted by nat at 1:55 PM on May 16 [3 favorites]


A little more on-topic...my car is 10 years old, paid off, and I intend to keep it running as long as I possibly can - ideally, until I'm too old to drive! This stuff still pisses me off, though.
posted by Greg_Ace at 1:58 PM on May 16


I'd try some sort of fancy license plate-obscuring technology, but Mythbusters said they're all bunk. :(
posted by Greg_Ace at 1:59 PM on May 16


Yeah, the privacy ship has sailed. It's been the norm for quite a while that lenders can remotely lock your engine if you've missed a payment.

I'm not talking about the lenders tracking me if I borrowed from them. I'm talking about someone having bought their car with cash, having an expectation of privacy from third parties. This repo drag-net is creating tracking data on people who have no business relationship with the lenders nor the repo companies, and cannot possibly have consented to this.

It's like Facebook creating "phantom profiles," except it's stalking people and tracking them. Companies should either be required to automatically and regularly redact data unrelated to their customers, or it should not be legal.
posted by explosion at 1:59 PM on May 16 [4 favorites]


talk up thread of subscription service for automobiles had me think of this:
motherboard article
boing boing article
articles about John Deere calling into question what your ownership rights are of technology you "own".
posted by djseafood at 3:30 PM on May 16


I just added it up, and in 10 years I lost close to $10,000 dollars on used vehicles.

Basically, of the 6 used vehicles I have owned, 5 of them had MAJOR SEVERE problems within the first year of ownership. This is across 2 Volvos, 2 BMWs, and a Ford. I had to scrap 3 of them, and pour money into the others. I had to budget $200 a month for maintenance for each one. (the sixth used vehicle, a Toyota pickup, was pretty damned reliable and cheap to own)

4 years ago I bought a new Toyota. $20,000. 60k warranties. I've already put 55k miles on it, and literally nothing has broken. Not even a flat tire.

It's like that saying, "It's expensive to be poor." It's expensive to drive a used car. I found it cheaper, both from a financial and from an emotional perspective, to own a new one.
posted by weed donkey at 4:35 PM on May 16 [12 favorites]


Re-reading my comment it's a little confusing...

What I mean is, I lost $10k in depreciation on used cars. As in, I bought most of my of cars for around $3k, and sold them for around $1k. That's a 66% depreciation rate, often in 1-2 years.

My new car depreciated 25% or whatever when I drove it off the lot. But my new car doesn't cost me hundreds of dollars per month in maintenance.

My used cars not only depreciated faster than my new car, but they also cost me out the ear on timing chains, belts, gaskets, water pumps, fuel pumps, and the like.

My biggest nightmare was when the fuel pump went out on my 98 volvo. Turns out it's a $1600 job, because you have to drop the fucking chassis off the body to do it. I now hate Volvos with a fiery passion.
posted by weed donkey at 4:51 PM on May 16


A federal court in Nevada ruled in January that the scans do not amount to unwarranted surveillance because they are essentially snapshots taken in public.

Hopefully the actual decision was more nuanced, because this reads like the decision is totally missing the point. The scans are bad not because someone took the photo -- it is what they do with that photo after taking it that intrudes on my privacy.

eah, I see an endless car payment into a subscription service in our future. CaaS! Gross.

Already here.


I have wondered for a while why this kind of subscription car service wasn't a Thing. Making some really rough calculations of depreciation, insurance, and maintenance costs, my vehicle (bought new, currently owned outright) has probably cost me something like $300/month, plus gas. The Volvo subscription plans say that they start at $600-$700/month (including service and insurance); that doesn't tempt me but I could totally see opting for a more plebeian subscription service from Toyota or Nissan, say.

There are likely reasons why it isn't a common approach, but I would have thought there would be value for the car company in having people semi locked into their brand, the way people are with their cell phone plans. Leasing is close, but it doesn't lock you into that brand in the way a subscription service would.
posted by Dip Flash at 4:54 PM on May 16


some people keep their plates in the back window - not legal in a lot of places, but ...

I wonder how many of them put theirs face down when they park it for the night
posted by pyramid termite at 5:17 PM on May 16


It's like that saying, "It's expensive to be poor." It's expensive to drive a used car.

Captain Vimes' parable may apply even more to cars than boots. Of course for many in the US cars are the functional equivalent of boots in terms of being an absolute necessity in order to earn a living, get to child care, get to health care, and so on.
posted by TedW at 5:56 PM on May 16 [2 favorites]


tgrundke:
> That's a pretty simplistic and Fisher Price way of viewing how finance works.

Not going to lie - I take your assumption that I know what that means as a compliment (looked it up tho). I'm not an economist, and I've never worked in finance. And I think we don't even disagree, except for the part where you put some words in my mouth:

> Is it some SPECTRE-esque plot to enslave everyone? Nope.

I said credit card companies are trying to make money, not that they're out to enslave the world. And if you keep reading, you'll see I don't even judge them for it, necessarily. I also didn't say that following my cartoonish predatory-lending script is all they do, just that it's a strategy that's being employed in order to make money, and it seems you're agreeing with that.

I tend to think about finance and economics in terms I know slightly more about, like dynamic systems and complex systems theory. Markets can be hugely beneficial, but they have degenerate states. Corporations are a large part of any such system, and we know what they're trying to optimize. It's almost unfair to ask them to be nice as well; they'd just get eaten.

The function of governments, OTOH, is to try and steer these systems away from degenerate states, and if a government does not try to do that in good faith, *that* is where I start to judge people. That was my point, other than trying to be funny about something I know little about.
posted by kleinsteradikaleminderheit at 6:00 PM on May 16 [1 favorite]


Read this at lunch and wondered if it would show up here. "Ordinary man spends his life getting out of tough situations . . . "

The Electronic Privacy Information Center filed at least one FOIA back when the FBI was starting to use LPRs en masse, and they appear to have done more advocacy on the subject.

I was pretty surprised the WaPo piece spent very little space on pushback or privacy implications--to me the headline is less "repo men have a new tool" and more "holy shit mass collection of license plates and who knows what else is being done by random semi-pros who have no idea what's being done with all the data."
posted by aspersioncast at 6:54 PM on May 16 [3 favorites]


If I'm not going to trade it in after 5 or 6 years, it's probably cheaper and easier for me just to just buy a new one.

I bought my very first ever new car back in 2012 and it's paid off. Granted it still has less than 27,000 miles on it but it has so far cost me no money for anything but oil changes and car washes.
posted by bendy at 8:17 PM on May 16


Yeah, I bought a new Mazda in 09, I think, she has less than 35k on her, and other than oil changes and new tires from living in a construction zone, she's cost me nothing compared to the big block old cars I used to drive because I knew how to fix them.
posted by SecretAgentSockpuppet at 8:32 PM on May 16


“The US Auto Industry is about to Implode - Michael Alkin”—Cambridge House International Inc., 31 January 2018
posted by ob1quixote at 10:02 PM on May 16


pyramid termite: "I wonder how many of them put theirs face down when they park it for the night"

Time to get a licence plate flipper/hider ala 007' DB5.

bendy: "I bought my very first ever new car back in 2012 and it's paid off. Granted it still has less than 27,000 miles on it but it has so far cost me no money for anything but oil changes and car washes."

You should check your manual for a time based maintenance interval. Usually things like coolant, brake fluid, timing belts, transmission fluid can go bad just from sitting. Also tires only have a 10 year life span.
posted by Mitheral at 10:55 PM on May 16


It's expensive to drive a used car.

It's expensive to own and operate a car, period.

That said, over all the years I've been owning and operating cars, I've spent less than half as much on it as would be typical for people who choose to front-load the bulk of the expense into the initial purchase price.

I don't understand why you folks insist on selling me your perfectly serviceable vehicles for an absolute pittance once their annual maintenance cost settles down to its long term average of about $500/year, but please never stop.
posted by flabdablet at 11:13 PM on May 16 [4 favorites]


It's not expensive to drive my used cars, except for the shittier fuel economy. Car payments? Those are expensive.

I have a '90 and a '98. I spend very very little on maintenance, outside of normal wear items like brakes and etc. Or paint touch up and etc when I feel like doing that. They are both relatively low mileage, especially the '90. (around 46k miles, I think the '98 has around 80K.). I have a short list of things that eventually need to be done on them, but do them at my leisure and as makes sense to avoid repeated disassembly/reassembly of the same areas. And on cars of that era, you can still do quite a bit of stuff yourself, which I'm slowly learning to do.

It may not be a good idea to have just one car that old, but having two in good shape is just fine.
posted by snuffleupagus at 11:21 PM on May 16 [1 favorite]


If I buy something cheap enough to pay cash, it's going to be at least 10 years old from some shady dealer and I don't know enough about cars to know if it's going to die on my way home from the lot.

I have owned three cars over the last twenty-five years. All of them were over 10 years old when I bought them for cash. None of them have been unreliable.

Dealers are not good places to buy cars, be they new or used. My current car came from a dealer (so warranty! much impressive!) because I was in a hurry to replace the one that young master flabdablet had rolled and destroyed, and once all the things that were wrong with it had been fixed, it had cost me roughly $2500 more than I would have needed to pay if I'd taken my time and done it properly.

If you only ever buy from from private sellers who have at least six years of service history documentation that shows the required periodic maintenance has been done, and you pay a couple hundred for a full mechanical inspection from an independent mechanic before finally handing over your hard-earned, you will end up owning a reliable used car instead of a lemon or a beater.

It's not expensive to drive my used cars, except for the shittier fuel economy.

My little car drinks about 5l/100km. A new Prius is rated at 3.8l/100km. It takes a very very long time for a difference like that to add up to anything substantial.

It may not be a good idea to have just one car that old, but having two in good shape is just fine.

The economics of owning used cars initially made themselves apparent to me when I realized that what I'd paid for my first used Mini was typical for that class of car, and that for what I'd pay for a new one I could buy seven like mine and still have enough left over for the custom plates reading MONDAY, TUESDY, WDNSDY, THRSDY, FRIDAY, SATDAY, SUNDAY that they'd need when polished to perfection and arranged in fine style out the front of my house.
posted by flabdablet at 11:33 PM on May 16 [2 favorites]


The other trick to not spending much on owning a car is aiming to own the smallest car you can find. For most cars owned by most people, most of the miles that get put on the car happen with one person inside it; it just doesn't make sense to spend a fortune on pushing an SUV's worth of air out of the way when you don't need to.

A well-designed small hatchback can accomplish the overwhelming majority of the tasks a car is required to do (I've transported a full-height refrigerator inside my L500 Mira, and regularly go bush in it) and for the rest there's hire.
posted by flabdablet at 1:09 AM on May 17 [3 favorites]


weed donkey (It's like that saying, "It's expensive to be poor." It's expensive to drive a used car.)

You're doing something wrong. My experience (never bought a new car) is that if you buy a 1-3 year old car, it still has some years to go until things begin to break down. It would be crazy to buy a 10-year old car, designed to fail at 8, and expect it to run cheap. That is pure lottery.

What I notice though, is that cars used to be designed for a longer life - my 2009 BMW is clearly designed for at least 8 years of life, after which the repairs slowly begin to trickle in. Contrast that with my neighbour, who works for a VW factory, and claims that VW's are built to last about 6 years these days, while Skoda's (downscale concern brand) about 4-5.

If you compare the solid cast aluminium axle arms on the BMW with tin-foil spatial structures found on a Kia (even the "SUV" ones), you know where the extra money went and what it's going to do there.

Toyotas used to be the benchmark of reliability, and they still might be, but the auto-makers seem to be pushing you to buy a new car every 4 years these days.

Of course, an important aspect is how much tinkering you want to do on your car - if it's not your thing, then not having to do it is a big benefit to you.

Which is why I enjoy our little (second-hand) electric VW up so much - little maintenance and no visits to the petrol station.
posted by Laotic at 1:52 AM on May 17 [1 favorite]


It would be crazy to buy a 10-year old car, designed to fail at 8

Quite so. This is an opinion I've seen frequently expressed by Americans, and is the main reason I would never even consider buying an American car; the other is that the US doesn't know how to design a small car in the first place.

By way of contrast, the average age of the Australian passenger car and light commercial vehicle fleet is 10 years and there are substantial numbers (my own among them) running completely reliably at two to four times that age. My first car was a British design built in Australia and the rest have been Japanese imports; all were well over ten years old when I bought them and they've all been pleasures to own.
posted by flabdablet at 4:51 AM on May 17 [1 favorite]


I can get anywhere between 3.49% and 0% financing for a new car, fully covered by warranty, guaranteed

It’s worth noting this isn’t the case for everyone. Poverty is hard on credit scores. When I was buying a car, I was offered 16% interest, which they finally got down to the princely 12%. That was the best offer I was made. I had to take it - I desperately needed a car.
posted by corb at 5:32 AM on May 17 [1 favorite]


Another bonus with older cars, which probably comes with some safety penalty, is that the windowline doesn't start at your neck and the dashboard isn't longer than an aircraft carrier.

It's not expensive to drive my used cars, except for the shittier fuel economy.

The other trick to not spending much on owning a car is aiming to own the smallest car you can find.

My little car drinks about 5l/100km. A new Prius is rated at 3.8l/100km. It takes a very very long time for a difference like that to add up to anything substantial.


My cars could not be described as little. One is a (rather early) turbo four seater and surprisingly long nose to tail, the other a high-compression v8 SUV (I figure it's the last SUV I'll ever own and I do take it to the mountains and snow etc). They both require 91 octane. But, of course, that's a choice. If I had a significant daily commute (which could happen at some point) I might snag something else. Maybe someone's used hybrid.

I'm not sure just buying a small car is the thing when it comes to reliability (it definitely helps with gas though). It's more about buying makes and models that are built solid and known to last, without lots of unnecessary crap that can go wrong, repair friendly (i.e. not made of extremely expensive "dealer only" modular components that must be replaced in entirety) and haven't been let go.

And when I'm running errands if I just stay off the pedal the economy isn't so awful. No one is getting awesome mileage shuffling through stop-and-go city traffic anyway, when you're idling at a light your MPG is 0 unless your car is modern enough to kill the engine at a dead stop and then restart on throttle tip-in (which I can't get used to in rentals -- what happened to the version where it just stopped firing most of the cylinders?).

I'm not sure if the Big 3 don't know how to design small cars, so much as that by the time Americans wanted to buy them (the '70s gas crisis, and the same with more recent fuel price shocks) the most important criterion was cost and foreign marks were way ahead of the game. So American subcompacts were and are built to be cheap, not to be good.

A well-designed small hatchback can accomplish the overwhelming majority of the tasks a car is required to do (I've transported a full-height refrigerator inside my L500 Mira, and regularly go bush in it) and for the rest there's hire.

Aside from the big hatchbacks, Volvo wagons can be good for this. Before it was bought by Ford and then sold to China in 2010. I'm not sure what "crossovers" are except shortened station wagons with a higher roofline.

The economics of owning used cars initially made themselves apparent to me when I realized that what I'd paid for my first used Mini was typical for that class of car, and that for what I'd pay for a new one I could buy seven like mine

Quite right. And I only say the thing about having two because sometimes it takes a few days to get a part, if something critical fails from pure aging of its seals etc (especially if you're picky about which replacement parts you'll accept, which I am, because I don't want crap).
posted by snuffleupagus at 6:51 AM on May 17 [1 favorite]


snuffleupagus: "It's not expensive to drive my used cars, except for the shittier fuel economy."

The big cost that is hard to put a price on is crash worthiness; even a 4-5 year old car is massively safer than a 20 year old car. Though we are starting to break over the shoulder of that curve. My latest "new to me" 19 year old car has airbags on both sides.
posted by Mitheral at 7:08 AM on May 17 [4 favorites]


It would be crazy to buy a 10-year old car, designed to fail at 8
The average age of cars on the road in the US is 11.6 years, so if you buy a 10 year old car, you are barely at the top end of that average. My current car is a 2005, and I do have to spend about $500 a year maintaining it, but it probably has another 10 years of life left. The interior still looks brand new- it's the engine parts that need occasional maintenance.
posted by The_Vegetables at 7:19 AM on May 17 [2 favorites]


>It would be crazy to buy a 10-year old car, designed to fail at 8
>and is the main reason I would never even consider buying an American car; the other is that the US doesn't know how to design a small car in the first place. By way of contrast, the average age of the Australian passenger car and light commercial vehicle fleet is 10 years

The average age of a car in the U.S. is 11.6 years. And it been increasing every year since 2002. "The oldest vehicles on the road are growing the fastest. Vehicles 16 years and older are expected to grow 30 percent from 62 million units today to 81 million in 2021. There will be more than 20 million vehicles on the road in 2021 in the U.S. that will be more than 25 years old."

70% of the cars in the U.S. are American brands and 75% of the "foreign" brands are assembled in the U.S.

Cars are much more reliable and longer lived than a decade or two ago.
posted by JackFlash at 7:19 AM on May 17


The big cost that is hard to put a price on is crash worthiness; even a 4-5 year old car is massively safer than a 20 year old car. Though we are starting to break over the shoulder of that curve. My latest "new to me" 19 year old car has airbags on both sides.

This is maybe a shitty thing to say, but you really don't want to get in an accident with one of my cars in a 4-5 year old car. Your newer car needs those features to protect you from my much heavier, all metal (and mostly steel) vehicles. And it will be totaled afterwards. I'll need some body work.

They both have airbags. The '90 was the first year for that in its model.
posted by snuffleupagus at 7:31 AM on May 17


It's not expensive to drive my used cars, except for the shittier fuel economy. Car payments? Those are expensive.

If being late for work can cost you a job, a used car can be very, very expensive.

My next door neighbor, retired, drives a Honda he just repaired himself on the street to save $400 on radiator work. He insists his daughter drive the new car to work.
posted by ocschwar at 7:46 AM on May 17


I've never had both my cars fail to start on the same day. Newer cars can have trouble too, unless you're someone who just leases something new every two years. And, often it's much more expensive trouble. Because nothing is actually serviceable anymore. Which makes taking high interest loans on current cars especially crazy. They're expensive, disposable and if they don't fail on time will be intentionally obsoleted by discontinued electronics.

Once upon a time, my family was still keeping my grandmas old '72 Dart Swinger around. I'm not sure anything but simple failures like a starter or fuel/water pumps would've kept that beast off the road. There just wasn't a lot to go wrong and it could all be fixed by a gas station mechanic in pinch.
posted by snuffleupagus at 8:07 AM on May 17 [1 favorite]


It’s worth noting this isn’t the case for everyone. Poverty is hard on credit scores.

Definitely true corb and I know it well. But I still suspect the interest rates from Honest Bob's Junky Rustbuckets tend to start much higher than dealer incentive ones and the terms are shorter.

I mean being poor means you get fucked every which way anyhow and you just try your best to pay the poverty tax because you don't have a choice.
posted by windykites at 8:17 AM on May 17


Your newer car needs those features to protect you from my much heavier, all metal (and mostly steel) vehicles. And it will be totaled afterwards. I'll need some body work.

The thing about cars that get destroyed in crashes is that they are deliberately designed that way so that the destruction of the car absorbs crash energy that would otherwise be delivered to the occupants. My relatively easy to destroy car might well be totalled if I crash it into your Yank Tank, but it would be doing that in a design attempt to protect both of us.

If two cars run into large trees at the same speed, and one of them is a tinfoil-around-a-passenger-cage crumpler and the other is an it'll-buff-right-out steel behemoth, the driver of the behemoth is probably going to need more body work than the driver of the crumpler.
posted by flabdablet at 8:23 AM on May 17 [3 favorites]


Yes, that's why I know it's kind of a shitty thing to say. The newer car is meant to destroy itself for the greater good, which I benefit from too. Mine are indeed mostly tanky, although were safe cars for their eras.

the driver of the behemoth is probably going to need more body work than the driver of the crumpler.

Probably true on the averages, and especially hitting an immobile object. The older cars are more survivable as objects but do less to actively protect passengers. I don't have kids, especially of the driving age, that probably affects my thinking here.

It’s worth noting this isn’t the case for everyone. Poverty is hard on credit scores.

My most recent ex and I are amiciable-but-distant and one of the things I still talk to her about is managing the horrible car loan she was saddled with because she had no options and needed something she could rely on for work and new enough to Uber off hours in. She's upside down on it and it's killing her. It's the difference between her and her preteen daughter getting their own apartment, or sharing a room in a 2BR split. It drove me nuts then and it drives me nuts now.
posted by snuffleupagus at 8:35 AM on May 17 [2 favorites]


[Y]ou really don't want to get in an accident with one of my cars in a 4-5 year old car.
I'll take my chances.
posted by Hatashran at 5:03 PM on May 17 [3 favorites]


Dramatic video! But of an 80 year old car.

2012 Lexus (Toyota) IS250: No thanks.
posted by snuffleupagus at 7:45 PM on May 17


I've never had both my cars fail to start on the same day.

A used car is almost always going to be cheaper than a new car. But if the choice is a new car or two used cars, the new car is probably going to save you money.
posted by Dip Flash at 8:36 PM on May 17 [1 favorite]


The average age of a car in the U.S. is 11.6 years.

Maybe, but how many are cars which their owners bought new and kept all that time, or bought second-hand when they were at most 4 years old? I'd say quite a lot.

If someone is selling a 10-year old car, then that car is probably becoming expensive to repair. I need our larger car for long trips, 1000km in one go, and I can't have it fail mid-way, because I'd be late for work. I'm noticing now that systems are beginning to fail and it's time to get a next one. The problem seems to be that car-makers are making cars with shorter expected lifetimes now, so I'll have to spring for a 1-year old car (still a great discount), and keep it for 8 years, instead of 10, as is the case now.

My father, on the other hand, keeps his 40-year old Lada, but is having increasing trouble keeping it in running order.
posted by Laotic at 2:31 AM on May 18


The problem seems to be that car-makers are making cars with shorter expected lifetimes now, so I'll have to spring for a 1-year old car (still a great discount), and keep it for 8 years, instead of 10, as is the case now.

This makes sense to me. This was happening by the late '90s I think -- a used '98 may or may not be better than a used '08 depending on whether it was the last years of an older model or the beginning of the modular/disposable era.

if the choice is a new car or two used cars, the new car is probably going to save you money.

Maybe? Up front, the insurance difference is negligible, but there is the additional registration. Possibly I'm just really lucky, or my cars don't have enough mileage to behave like typical old cars, but I've spent less on maintenance than both of my parents have on their new German and Japanese cars under warranty over the last couple years. By thousands of dollars.

I think I just react strongly to the idea of one more bill I have to pay every month or kill my credit score -- and on an auto loan, face repossession. And then, in most states, maybe a judgment on the deficiency after auction, anyway. If I took the money I'd have to put towards a payment into my cars, I'd be able to fix literally every little thing wrong with them by the end of the year.

Certainly, the ability to shop for the right used car and then buy it outright and have enough cash or less extortionate credit to deal with what comes up is a certain amount of privilege. No shade on anyone who's job and family life forces them to take a predatory dealer-loan just to tread water. That happens with used cars too.
posted by snuffleupagus at 6:58 AM on May 20 [1 favorite]


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