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The Used Market Is Starting To Make More Sense

Illustration for article titled The Used Market Is Starting To Make More Sense
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The Morning ShiftAll your daily car news in one convenient place. Isn't your time more important?

The used market is coming down from a high, Hyundai has a new chairman and the launch of the Ford Escape plug-in hybrid has been bungled. All that and more in The Morning Shift for October 14, 2020.

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(FYI: Some articles linked to below are behind paywalls. Most of you know that, but I’m putting this here for everyone else. Pay for news that you value!)

1st Gear: The Used

A former colleague of mine here at Jalopnik bought a 2005 Pontiac Vibe last Friday for something above $5,000, which is too much to pay for a 2005 Pontiac Vibe but is also where the market is at. The buyer’s name is not Patrick George or Mike Ballaban, though it should have been. I bring this up because right now is just about the worst time in a while to be shopping for a used car. That said, things are starting to normalize, according to the Associated Press.

...the market is starting to even out for used vehicles as trade-ins resume. New vehicle sales were down 9.7% in the third quarter, far better than the 31% free-fall from April through June.

“Because we’re selling so many new cars, we’re getting trade-ins, so that’s taking the pressure off of going to the auction and having to pay too much money,” [Earl Stewart, owner of a Toyota dealership in North Palm Beach, Florida] said.

The average retail used-vehicle price has fallen by $100 so far in October when compared with September. [Alex Yurchenko, senior vice president of data science for Black Book, an automotive analytics firm that helps dealers determine vehicle prices] predicts the downward trend will continue at least through the end of the year, barring any unforeseen developments with the virus.

For the year, wholesale used vehicle sales are off 16% from the first nine months of 2019, Yurchenko said.

Both he and [Jeff Schuster, senior vice president at LMC Automotive, a consulting firm] said it’s wise to hold off buying a used vehicle if you can, because prices should drop further by the year’s end.

“If you’re just shopping, I’d wait,” Schuster said. “Let inventories rebuild a little bit.”

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All my friends in New York City are getting used cars amid the pandemic; the only one who is still holding out is former Jalopnik writer Aaron Gordon, who would spend his nights lighting cars on fire if that didn’t hurt the environment so much.

Reached for comment, Gordon said, “Only the performance-SUVs and pickups.”

2nd Gear: The PHEV Ford Escape Is Delayed

Ford has a bad habit of bungling the launch of new vehicles, which newly-minted CEO Jim Farley is supposed to fix. Farley has been in the job only two weeks now, so the delay of the PHEV Ford Escape isn’t really his fault; it won’t sell great in any case so I’m sure Ford isn’t too worried. But still, this seems bad.

From Bloomberg:

Ford Motor Co. is delaying the launch of its plug-in hybrid Escape sport-utility vehicle to 2021 after thousands of similar SUVs in Europe were recalled for problems involving fires while recharging.

The Escape plug-in hybrid originally was scheduled to go into production this past spring but Ford changed it to summer after the coronavirus pandemic shut factories for two months. Now Ford is pushing it into 2021 as it reviews issues with the European-market Kuga model, which shares parts with the Escape plug-in — including the battery and engine.

“We’re moving production to next year while we investigate what happened to the Kuga in Europe,” said Mike Levine, a company spokesman. “None have been sold in the U.S.”

[...]

Ford of Europe is working to fix a problem with its Kuga plug-in related to venting heat from the batteries, Jay Ward, another company spokesman, said Tuesday. There have been seven vehicle fires in Europe, triggering the recall of 20,500 Kuga models sold there, spotlighting an issue that could take months to resolve, Ward said.

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3rd Gear: Hyundai Has A New Chairman

He is the son of the former chairman. Euisun Chung will take over for his 81-year-old father, Mong-Koo Chung.

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From Automotive News:

The younger Chung, 49, previously the auto group’s executive vice chairman, was promoted to chairman at an extraordinary board meeting, the company said Tuesday.

His father, Mong-Koo Chung, 81, was made honorary chairman in the shuffle.

Euisun Chung has exerted more influence over the entire auto group in recent years. His father gave up his board seat in Hyundai Motor this year after stepping back from daily operations.

Chung joined the carmaker as a director of procurement in 1999 and became president of Kia Motors Corp. in 2005 and vice chairman of Hyundai Motor Co. in 2009.

[...]

“Much like the founders of the great Korean chaebols, Euisun Chung is a change agent,” Frank Ahrens, Hyundai’s former director of global public relations, wrote in an email to Automotive News.

“He has prepared his entire life for this moment, studying the companies diligently and seriously, and he has worked at both Kia and Hyundai. But he is no placeholder or status quo choice. He knows what to keep from his company’s and business culture’s history, and what to discard.”

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You can now go back to not ever thinking about who the chairman of Hyundai is.

4th Gear: The Ford Mustang Mach 1 Will Start At $52,915

That includes shipping. I will stop typing about this car now to avoid saying anything rude.

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From Automotive News:

The Mach 1 will start at roughly $4,000 more than the 2020 Bullitt, which started at $48,900, including shipping. It will cost almost $9,000 less than the 2020 GT350, which starts at $61,635, including shipping.

The vehicle will be built in Flat Rock, Mich., along with other Mustang variants.

Ford timed the opening of order banks and the release of pricing details to the 73rd anniversary of Chuck Yeager becoming the first person to break the sound barrier, known as Mach 1.

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5th Gear: We Could Have A Strike On Our Hands In Canada

Unifor, the union that represents 8,400 Fiat Chrysler workers in Canada (in addition to hundreds of thousands of workers elsewhere), said this week that talks weren’t going well over a new contract with FCA. The strike deadline is tonight just before midnight.

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I was in the room where it happened when the GMG Union last negotiated our contract, so I know lots of posturing is involved on both sides, but that said, it doesn’t really sound like Unifor is fucking around.

From Automotive News:

The two sides were “not quite where we feel we should be with this limited amount of time left on the clock,” according to a Monday Facebook post by Unifor Local 444, which represents workers at FCA’s Windsor, Ontario, assembly plant. “We have given our Strike committee the nod to be READY if we cannot come to a tentative agreement with FCA.”

[...]

FCA Canada spokeswoman LouAnn Gosselin declined to comment on the talks beyond a statement previously issued at the start of bargaining Oct. 1.

“FCA Canada welcomes the opportunity to move our discussions with Unifor forward,” the statement read. “We are committed to reaching an agreement that will allow us to continue investing in our future and create opportunities for our employees, their families and the communities where we live and work.”

In an update posted Tuesday afternoon on the Unifor national website, the union said it was “encouraging members to be prepared if strike action becomes necessary,” though it remained “hopeful” that a tentative agreement would be reached by the deadline.

“However, if FCA continues to push back on the pattern and refuses to deliver concrete investment commitments, the likelihood of job action as of midnight on Oct. 15 grows,” the union said.

A strike would halt production of the Chrysler Pacifica and Voyager minivans in Windsor, as well as the Chrysler 300 sedan and the Dodge Charger and Challenger muscle cars built in Brampton. It would also shut down an FCA casting plant in Toronto that builds aluminum die castings for various FCA models.

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Solidarity with Unifor.

Reverse: Chuck Yeager

He’s still alive and tweeting though it. I cannot recommend “The Right Stuff” the movie, as I haven’t read the book, which I’m sure the book is great enough.

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Neutral: How Are You?

I am also still alive and tweeting through it. The alternator, tires, air- conditioning compressor, front driver-side suspension and transmission fluid have all been replaced and/or failed in my 66,666-mile 2008 Honda Fit, I realized yesterday, which is not at all what Honda intended. I can’t wait to stretch its legs this weekend on a drive to the North Fork.

News Editor at Jalopnik. 2008 Honda Fit Sport.

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DISCUSSION

newnamesameme-post
newnamesameme

1st gear - just yesterday my local Nissan dealer hit me up offering 15k for my 2015 Xterra Pro-4x with only 45k miles on it. I laughed the guy off of the phone. A: i dont want to sell it cause i use it a lot for what its built for and B: in Colorado, especially far Western CO, where i live, i could sell this for low to mid 20k range privately.

Stealerships out here just trying to find and scam low information sellers.