Thanks and an interesting perspective!

I wish we could be like giant flat screen TVs though, where we get a lot more SUV today AND we can now buy the Pilot for only 19,999 when it used to cost 42,050!

 

Certain elements of cars have become much cheaper over time, like you mean. Electronic components are significantly less expensive now then 20 years ago.

But, there's so many more requirements for safety, emissions, demands from consumers, and designs have gotten much more complicated to build because of that. If it was still legal to produce a first gen Pilot as it was, someone would have bought the tooling from Honda and offered it to this day for very cheap. It's basically regulations that are the reason cars haven't gotten much cheaper over time.

 

But relatively speaking, I think the 2003 (and all the older cars) was more expensive than the current ones. Especially for what you were getting

$32k back then is way more than $44k now

 

I took a middle CAGR calculation w/ 2016 Exl AWD @ $38020 and figured 2003 to 2016 price increase is only about 1.2% vs 2016 to 2023 is 2.1%. So even thought the CAGR curve looks like it is accelerating lately but still reasonable compared to CPI. I guess it is all relative....

 

One element you missed is how much more money you are making in your line of work to pay for all these goodies. A lot of variables to consider. New job, married, kids. I do agree cars are much safer, more advanced technically and in most cases more reliable.

 

Yep, everything else is up, but looking at the numbers, cars are not.

I know we all make these purchases based on the current market, and resale values follow that also, but one common statement that is not really true is when we hear that "cars are so expensive nowadays". There's just nothing to back that. We just feel that cuz we look back at the previous year, and don't temper the new price relative to everything else.

Housing, college, insurance, those are a different story. I think those are way over CPI. But not cars

 

As a family man with three kids under ten, I wish everything in my life were cheaper.

 

Wait till they are teenagers. Trust me, it gets a lot worse.

 

Another element critical to understanding the economics of the situation is regulation.

I admit zero knowledge of the specifics, but I'm positive that the 2023 Pilot is subject to regulatory requirements that the 2003 wasn't.

Emissions is the big one, but safety elements, catalytic converters as well as improved crumple zones and the like to keep up with the status quo in crash and rollover tests. These all comes with costs that we don't normally think about.

 

Not to mention inflationary increases.... running the cost of that 03' @32,500 in 2022 dollars (2023 not available) it costs over $50k!! if you invert the 2023 price into 2003 dollars, looking about $20k.... It's that loss of spending power that's killing us IMO... interesting topic.

 

The stats I saw recently were that used car prices increased by 51% from 2/2020 to 12/2021 and then fell by 15% from 12/2021 to 12/2022. so, they have retraced about 44% of the big jump, not even half way back. Says to me that there is still more to go on used cars.
that is part of the reason I am buying a 23 now while my 2017 is probably worth more.

 

We always hear in passing, comments about how expensive cars are, along with everything else etc etc. Part of it is that we have short memory, and the current time always seems tough, and part of it is just that we are spending our money on lots of other lifestyle things.

I wanted to quantify this as it relates to cars, so I looked back at a 2003 pilot EXL AWD, and compared it with a 2023 same trim. Surely the 23 beats the 03 in every way, including size, power, performance, safety, comfort, etc.

2003 pilot exl awd $32,520
2023 pilot exl awd $44,050

That's a 35.5% increase in 20 years, which is +1.53% average annual increase.

For comparison, CPI has gone up 51% in the same period, average +2.21%/year.

Not to mention that $32,520 in 2003 equals $53,354.55 in 2023.

 

Not to discourage people from buying used cars, but outside of price, we need to factor in repairs and maintenance. A 2003 or even 2013 will need a lot of work. Or I should say, owners need/should spend some money to keep it running. 10 years ago, every time you bring your Honda into the dealership, it would be $"300." Today, every time you bring your Honda in, it will be "$2,000." Yes, one can also take their cars to other repair/service facilities, instead of the dealership. But you get the point, and we don't need to drill down to oil changes and air filters.

A 2023 should need "nothing" for many years.