Record number of Americans behind on auto loans

[Coal Dragger]

I used to work in the car business after I got out of the Corps. Even back in 2005-2006 people were doing remarkably dumb shit where income to debt on auto loans was concerned.

All the unnecessary tech on vehicles today has of course driven costs up, and manufacturers and their finance arms have responded by offering easy money for loan durations that are just lunacy. A correction is needed, and the blow shouldn’t be softened.

Right now I have one vehicle payment and about 2 years left on it. Not a big deal, just a fraction of our income and financed at 0% APR. My truck has been paid for since 2012 and I just keep driving it, no reason not to. Also financed it at 0% APR. I might buy a new truck in a few years if Toyota brings it with a Tundra redesign.

Some of the vehicles for sale today are just idiotic. For example pretty much every 3/4 ton and 1 ton diesel pickup truck is completely retarded for 95% of the people who buy them. They cost way too much, they’re not reliable or durable long term, and the towing performance is not exponentially better than a cheaper easier to maintain gasoline engine. Even for those who do tow all the time I have to wonder if stepping up to a medium duty truck or even a class 8 might not make more sense, considering that is tiny sliver of 3/4 ton or 1 Tim buyers who run loaded all the time.

[gaijin]

Who’s your bet for advocating “forgiving truck payments”?
Another potential carrot on a stick for the left.....

[AKDoug]

I used to work in the car business after I got out of the Corps. Even back in 2005-2006 people were doing remarkably dumb shit where income to debt on auto loans was concerned.

All the unnecessary tech on vehicles today has of course driven costs up, and manufacturers and their finance arms have responded by offering easy money for loan durations that are just lunacy. A correction is needed, and the blow shouldn’t be softened.

Right now I have one vehicle payment and about 2 years left on it. Not a big deal, just a fraction of our income and financed at 0% APR. My truck has been paid for since 2012 and I just keep driving it, no reason not to. Also financed it at 0% APR. I might buy a new truck in a few years if Toyota brings it with a Tundra redesign.

Some of the vehicles for sale today are just idiotic. For example pretty much every 3/4 ton and 1 ton diesel pickup truck is completely retarded for 95% of the people who buy them. They cost way too much, they’re not reliable or durable long term, and the towing performance is not exponentially better than a cheaper easier to maintain gasoline engine. Even for those who do tow all the time I have to wonder if stepping up to a medium duty truck or even a class 8 might not make more sense, considering that is tiny sliver of 3/4 ton or 1 Tim buyers who run loaded all the time.

I couldn't agree more, most people have zero need for a 1 ton diesel. However, there is a place for 1 ton trucks in the commercial world. When stepping up to a medium duty truck, which usually use the same engine as the pickup, you get a HUGE penalty in fuel mileage. I own multiple trucks in pickup, medium duty and class 8's. The pickup towing a goose-neck out performs my medium duty in almost every scenario. Price is no different between the two, but I can comfortably drive my 1 ton without the trailer home every night. My medium duty truck is a 20' dump flatbed, it gets half the fuel mileage my Duramax gets and it can haul less than I can with the gooseneck. It excels at getting into tight places and dumping loads, so it stays in the fleet. My class 8's get 5mpg regardless of what they are doing, so unless they are heavily loaded, they aren't worth it. I can get 10mpg out of my Duramax towing 20K, so it gets the nod for lighter loads. I recognize I'm an anomaly in the pickup driving world.

Unfortunately, trucks of all types have increased in price faster than inflation since 2000, even class 8 trucks.

[Coal Dragger]

I think Ford, and GM are aware of the unsustainable nature of their 3/4 ton and 1 ton diesel offerings, witness their development of larger gasoline engines for that segment as well as the medium duty chassis class.

They’re probably onto something, realistically a big V8 will do alright under a load and given the emissions crap on new diesels killing mileage and long term durability, the big gas V8 will probably outlast the new diesels.

The 7.3L gas V8 Ford is bringing seems like a good start, appears to be way overbuilt and made to work.

[AKDoug]

I think Ford, and GM are aware of the unsustainable nature of their 3/4 ton and 1 ton diesel offerings, witness their development of larger gasoline engines for that segment as well as the medium duty chassis class.

They’re probably onto something, realistically a big V8 will do alright under a load and given the emissions crap on new diesels killing mileage and long term durability, the big gas V8 will probably outlast the new diesels.

The 7.3L gas V8 Ford is bringing seems like a good start, appears to be way overbuilt and made to work.

We'll see. Once you tow with a high powered diesel it's hard to go back. HP is great, but torque rules when towing. That new 7.3 is slated for 500 ft lbs, but the 6.7 diesel makes almost twice that. The big weakness in the past was not giving us a great transmission behind the gas trucks. I'll admit that 7.3 makes me go hmmmm..

[Coal Dragger]

I make a living pulling 19,000 ton trains around so believe me I understand the benefits of torque (well in our case tractive effort at the draw bar) getting a load moving. However, horsepower makes everything better and the more I have per ton, the better. At any rate diesel electric locomotives with medium speed diesels are a different animal.

Ford understands that fleet buyers could give two shits about how the vehicle feels or whether or not it is satisfying for the driver to operate. They care about the bottom line, and the bottom line is that fleets are increasingly not buying diesel work trucks. The diesel is too expensive to buy up front, too expensive to maintain long term, and has too much downtime in comparison to the gasoline offerings. My employer no longer buys diesel trucks for maintenance of way unless they’re of the class 8 size for example.

I don’t think official ratings are out yet for the Ford 7.3L, but I’m guessing that 500ft-Lbs is a conservative estimate. I’m going to go out on a limb and guess that we’re looking at around 550ft-Lbs, and 425-450hp depending on how well the heads will support airflow at higher RPM’s with a stock cam designed for low end torque production. Modern head designs that flow lots of air have been proven to still make good horsepower numbers up top even with mild cams, and I’m sure that the heads on this new engine are going to benefit from a lot of that know how. The internals are pretty much made to take boost, leading me to wonder if that is also in the works for other applications. Either way pistol oil squirters, forged rotating assembly, high durability rings, and the other heavy duty aspects of the engine should make a long lasting mill. Plus they wisely stuck with easy to maintain port fuel injection instead of DI, so servicing this engine should be a piece of cake to include the fuel system. I think Ford is going to sell a lot of these engines because it just makes sense.

Putting a good transmission behind it will also greatly widen the appeal, and 10 gear ratios is a lot of cogs to work with to keep the engine where it needs to be to do get stuff done.

I’m also going to guess that GM’s new 6.6L V8 gasoline engine with DI is going to be plenty capable and a lot more popular than the old 6.0 at least it will make a base model 2500 a lot more viable.

[AndyLate]

It’s not just cars.
I see people with a tenth of my income buy more expensive phones more often, top available internet service, top expensive phone plans, max cable, have a dozen streaming services, bigger TVs, etc.

All things without any, or little to no future value.

My wife and I have the highest income in our families, but we don't drive the flashiest cars, have the newest phones, biggest tv, etc.

Of course, my primer/powder/projectile/loaded ammo expenditures are crazy...

Andy

[everready73]

People are crazy with high car payments. I have a 2011 chevy impala i bought used on 2012 for a good deal and low miles. It has been paid off for years and i am up to 175k miles and it is still going strong. My wife has a newer Mid size SUV, but that is the family car and i wanted something nice and safe. The payment isnt bad at all though.

I take the extra money and make sure i am maxing out my 401k every year and save/invest the rest

My wife and I have decent jobs and we are going on vacation to the outer banks next week. A girl I work with was asking how we can afford to take the whole family on vacation a few times a year. I told her priorities. She drives a brand new Grand Cherokee that was like 46k new. Her husband didnt want to be outdone and had to have a 50k truck. That is over 1.5k a month just in car payments I am assuming. Lots of money that could be spent on quality family activities or things you actually enjoy

[docsherm]

If you knew the demographics involved you wouldnt feel bad. I know I dont.

They will never show that...........

[pinzgauer]

I couldn't agree more, most people have zero need for a 1 ton diesel.

SNIP

Unfortunately, trucks of all types have increased in price faster than inflation since 2000, even class 8 trucks.

So the reality until recently is that if you needed a pickup, fuel mileage was crap. Case in point: I could tow a 2003 4x4 Tacoma or Frontier quad cab with my 2003 Cummins Ram 4x4 3500 and get the same mileage as they would have driving down the road unloaded.

Tow 1500-2000 lbs with a V8 chebbie/ford gasser and mileage dropped to mid single digits, with the tranny shifting on the freeway for small rolling hills. In my Cummins Ram it dropped 1 MPG and was loafing and stayed locked in OD.

Just no comparison. To their credit, my son just bought a 2019 Tacoma 4x4 quad cab, and it's average is 22 mpg, and he's seeing 25'ish on the highway on a regular basis. That's not unreasonable for a small truck. I'm also hearing similar for unloaded F-150's with the ecoboost, etc.

And yes, new diesel truck prices are stupidly high.

I think Ford, and GM are aware of the unsustainable nature of their 3/4 ton and 1 ton diesel offerings, witness their development of larger gasoline engines for that segment as well as the medium duty chassis class.

They’re probably onto something, realistically a big V8 will do alright under a load and given the emissions crap on new diesels killing mileage and long term durability, the big gas V8 will probably outlast the new diesels.

Really do not believe the gassers will outlast cummins diesels, even with the emissions stuff. Just not enough changes to the core engine, the emissions crap is stuff like particulate filters, etc.

They suck, but do not shorten life. EGR valves do shorten a bit if not well maintained.

We'll see. Once you tow with a high powered diesel it's hard to go back. HP is great, but torque rules when towing. That new 7.3 is slated for 500 ft lbs, but the 6.7 diesel makes almost twice that. The big weakness in the past was not giving us a great transmission behind the gas trucks. I'll admit that 7.3 makes me go hmmmm..

You really have to look at torque at typical highway RPM. That's the big lie in the GM/Ford diesel torque/HP claims, and also for gassers. Do the math to see what the RPM is at 65, and then look up torque.

And remember, optimal fuel mileage tends to be near torque peaks.

Not that gas engines can't be optimized for torque, they can (Pinzgauer 2.5l aircooled as an example). But it's at the expense of higher RPM/HP. The CVT's are starting to do some of this, with Nissan full sized cars and mid-sized crossovers getting 39-40 MPG with passengers at highway speeds.

Do I think people spend stupidly on big trucks? Yep, just like they do on $90k escalades, etc.

Is the fix to get rid of 2500 & 3500 diesels? Don't be silly. Not the problem, not the fix.

If anything, get rid of 2wd tundras and similar that are status vehicles, get below 20MPG unloaded, and never are used for real work.