This week we purchased the lease on our 2019 Honda Accord.
We drove in and out of Dublin Honda a few times and were amazed at how empty the large parking lots were. The same was true of other merchants nearby. Our representative said they had no new deals on the lot and almost everything coming from the manufacturer was already reserved by customers who had put down a $5k deposit.
I had read about how weird the car market is, but I saw it first hand. Our purchase price after three years was just under $16k for a car that was worth $30k or more used. Of course, if we decide to sell it, what we’d pay for a replacement and where we’d find it would be big open questions.
When was the last time you drove a car 20,000 miles and it was worth more as a used vehicle than it was when you drove it from the new country?
It makes strange prices for the few new and used vehicles that dealers have in stock. With used vehicles like mine now selling for more than they cost new, dealers are ignoring manufacturer’s suggested retail prices and marking up new vehicles, so there’s a reason to buy a new car versus a used one . These increases, for vehicles with modest prices, can be 6-8 thousand dollars. With inventory running low, retailers are taking it because consumers simply have no choice.
What a difference the pandemic and related supply chain issues have made to this industry – and many others.
Talking to the finance person, he estimated that they had lost more than two thirds of their sales volume and our sales rep said that the team had shrunk by the same percentage as sellers struggle to stay in business in these times really strange The service department has been the only area that has provided steady cash flow, although if we have a bad recession and money gets tight, that could change as well.
If you have been following the news at all, you’ve seen independent truckers doing their best to shut down operations at the Port of Oakland. They are rightfully upset with the 2019 law, AB5, which aims to make gig workers instead of independent contractors. It was led by then-Assemblywoman Lorena Gonzalez, a professional labor organizer who served in the Assembly. It passed the bill through the Democratic-dominated Legislature, and Gov. Gavin Newsom signed it despite business opposition.
Remember, Democrats’ closest allies and biggest funders are unions, and unions want more workers which they believe will lead to more union members.
If you had enough political power in Sacramento, you would have an exception like the real estate industry. Tell me the difference between a real estate broker and a court reporter or a freelance truck driver – none but political juice. The truckers challenged the law all the way to the Supreme Court and lost. Now it’s ready to go into effect, and the governor and Gonzalez, now head of the California Federation of Labor, have publicly absorbed it and implemented it.
For truckers, there are no good options – if this drags on and significantly affects port operations at the ports of Oakland and Southern California and hurts the economy, then maybe Newsom will step in and consider changing the really bad law. As of Monday, truckers suspended their exit and port activities were resuming.
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