Very recently banks have announced they're loaning up to 120% of the value of a new car.
Link?
Gone are the days of the 3 and 4 year car loan for a large percentage of Americans.
With soaring prices on vehicles and dwindling income people are signing 6 and 7 year loans.
Thats fucken nuts!! You're pretty much guaranteed to end up backasswards on the loan.
This is a symptom of what the OP is talking about,and it's only going to get worse.
I have huge problem with this logic.
The whole reason prices have gone up, is because of buyers. Buyers demand cars that are more expensive than they can afford. If no one bought a car they couldn't pay cash for, the prices of cars would go down. But that would require you buy a less expensive car. People don't want to do that. So this crying over buying cars you can't afford, for loans you can't pay back, is not the car companies fault. It's the public's fault. Stop buying cars you can't afford.
And of course you are going to end up backwards on the loan. Any loan made on a product that goes down in value, you are going to end up upside down on. If you buy a couch with a credit card, you are upside down on the couch before you get it to your home.
Any time you borrow money on something that loses value, it is mathematically impossible to end up upside down on it, unless you place a ton of money down.
You used to be able to buy a nice truck for 25k 15 years ago.
Now that same truck would run you around 40k yet wages are still the same...thats a problem.
That's a bit nebulous.
Define exactly what you consider a "nice truck for $25K".... because....
http://www.autotrader.com/cars-for-...rchRadius=25&showcaseListingId=411949367&mmt=[CHEV[COLORADO[]][]]&listingId=409699020&Log=0
Chevy Colorado Extended Cab, for $23,000 new. I've been in one of those. That fits my definition of "nice".
Now most people want the 300 HP V-6, with the premium stereo blue tooth, Z71 option, with 4x4 and fog lights and bell and whistles, and yeah that costs significantly more.
But to just get a decent truck.... For $25K.... yeah you can do that. People choose not to. People choose to buy all the bells and whistles.... but that doesn't mean "you can't buy a nice truck for $25K".
In 98 I purchased a Toyota Tacoma 4X4 TRD with blower and all the bell and whistles for 25k
That truck today without the blower,which is around an extra 5k,will run you over 37k.
Add the blower,which unfortunately is no longer available,and the price jumps to 42k.
Wages sure as hell havent kept up with the rise in the price of the truck.
Um.... but those are not the same truck. Same name..... but it's not the same truck. It's not even classified by the government as being in the same class.
Toyota Tacoma - Wikipedia, the free encyclopedia
Class
Compact pickup truck (first gen)
Mid-size pickup truck (second and third gen)
The first generation is a "compact" class truck. From 1995 to 2004, these were small trucks. I know the exact model your talking about.
From 2005 to present, they are the Second and Third generation, which are classified as "mid-size".... and they are. If you go and look at them, they are clearly and obviously much larger than the first generation truck you purchased.
Not only that, but they have far more bells and whistles than your first generation 1998 Tacoma ever did. That's costs more money.
Now beyond that, do you know what the CAFE standards are? Corporate Average Fuel Economy. The federal government averages out the fuel economy of all the cars sold by the entire corporations, and then charges them a penalty for the cost over an arbitrary number.
What this means is that the company has to pay a huge sum of money for cars that have low gas mileage.... which of course is cars with more powerful engines. That cost is passed on to YOU the consumer. The result is that vehicles with powerful engines end up having their price jacked up. I can almost guarantee you that's why your blower option is gone. And why high performance Tacoma is more expensive.
So not only is it a bigger truck, not only is it a more advanced truck, but the government piled cost on the truck.
So yeah, not all that surprised that the price is much higher.