Has The Cheap Car Disappeared?

Issue #130

We hope your Tuesday is going great! 

Hot off the press, today we discuss why cheap cars are disappearing, RAM’s massive recall, how Tesla lost billions, and much more.

Market News

• Tariffs on Japan focus on rice and cars. Here’s more on what’s happening.  

• Musk announces a political party. Tesla loses billions; here's how much.

• Can you compound car benefits and save good money?

• Here are all the cars that will lose the $7,500 EV tax credit.

• The most reliable brand isn't a Toyota or a Honda; it's this. What are your thoughts?

• Here's why automakers should be concerned about Toyota's new engine lineup.

• Ford CEO says this was his most humbling experience and why it could affect us.

• Volkswagen wants to take on Tesla's robot-taxi game. Here's how.

• This car company is taking over the world. Will it make it to the US?

• Honda pulls the plug on this future project, marking a shift in the company's direction.

Safety and Recalls

• We explain the NHTSA's latest investigation on 1.2 million RAM trucks here.

• Subaru recalls this model for loose child seat bolts.

Car Culture

• This Chevy Vega spent 50 years underground. Now, it's in parades.

• Can an NFL rookie make minivans cool again? Here's what we mean. 

• Where does the name PT Cruiser come from? Here's the story. 

• Here's how Porsche teased the new electric Cayenne. It's pretty cool. 

• A woman took her car to the mechanic and was told to do this to fix the problem.

• Dodge might be testing the Charger with a V8, and we love the idea. 

• Nissan might be struggling, but daily driving a Nismo Z is still a great idea. Here's why.

• Here's the cheapest V8 car with a manual transmission. Would you buy one?

• This mysterious startup abandoned its prototype in a warehouse. You can have it, but you can't drive it. 

• Why are these Charger EVs not dropping in price? 

Video Of The Week

The Car Wizard addresses one of Ford's most controversial engines while servicing a 2008 Expedition.

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In The Know

The Cheap Car Is Dead

In 2024, Nissan sold 42,590 Versas in the United States. That was almost double the sales of 2023 and nearly triple the 2022 figures. While the number may not be impressive, especially compared to other models, it is vital to the automotive industry. You can read more about Nissan sales in the US here. 

Unfortunately, Nissan Versa sales might not be enough to sustain the crumbling Japanese giant. This article speculates whether Nissan will even survive the next five years. 

So, why does the Nissan Versa matter? It's a slow, boring car with an unenviable performance and a faltering company behind it. It's not much of a looker, either, but it does reveal a great deal about consumer behavior. 

The recent spike in Versa sales highlights a reality: people want an affordable car, and this isn't a new trend, as this article from 2023 explains.

So, it should've been no surprise that the Versa was, for Nissan, a "best-seller," although Nissan had to cancel the manual version due to low sales. Here's the report. 

A cheap, comfortable car (i.e., one with an automatic transmission) is becoming more appealing to the American consumer. The problem is that they might disappear. 

Making a car is too expensive, as this article explains, and we're already feeling the burden.

The Average Transaction Price (ATP) for a new car was $48,422 in recent months. However, the MSRP has averaged $49,000 in the same period, which is 30% higher than in 2020.

This article delves into this topic and explains that the difference between ATP and MSRP reveals some discounts, albeit not substantial. 

The stat we just mentioned also pinpoints something interesting: the relentless increase has been happening long before tariffs. 

The latest tariff situation is only a piece of the puzzle. Still, there's no doubt that automakers will try to unload the tariff impact on customers, as this article highlights. 

There's no clarity on what will happen in the future. We can only see what's happening right now. 

The manual Versa was priced at around $19,000, making it the most affordable car on the market. However, realistically, buying a new car under $30,000 is more challenging. Although, this link gives you some options. 

Even the promising ideas of the future are no longer as exciting. We had discussed the new Slate truck as an interesting yet flawed idea in our newsletter. 

Now, with so many changes, the Slate truck will no longer be priced under $20,000, as this article explains, confirming our concerns from a few months back. 

With the new, affordable car no longer available, does that mean we should all buy used cars instead? Not exactly. 

Used car prices are the highest they've been since 2023 (which was a record year), and you can read more about it here. 

We've discussed how the new car under $30,000 has disappeared. The same applies to the used car under $20,000. According to this article, there are 76% fewer options in that range for used cars. 

Ultimately, this means that buying a car is now a crucial financial decision. We've discussed how to stay on top of your car loan before, and you can read our tips here. 

If you would like to learn more about managing your finances when purchasing a car, please let us know. We're thinking about a new section, and we'd love to hear your thoughts.