What Happened to the Affordable Car?
Summary
The Journal explores why new cars have become increasingly expensive, with average prices doubling over 25 years. Host Jessica Mendoza and automotive reporter Sharon Terlep discuss how manufacturers shifted toward profitable SUVs and trucks, while pandemic supply issues and rising loan rates further inflated costs. The episode highlights a "K-shaped" market where affluent buyers purchase large vehicles while others hold onto older cars, and examines new ventures like Slate Auto that aim to revive affordable, minimalistic vehicles.
Topics discussed
Josiah Johnson and his 1993 Toyota T-100
Why Josiah keeps his old truck: cost and utility
The rising cost of new vehicles
Trends in car ownership and market factors
Show introduction and sponsor segment
Average car prices doubling over 25 years
Shift from sedans to trucks and SUVs
Industry consolidation and model reduction
Defining crossovers and profit margins
Vehicles getting bigger and more expensive
Pandemic supply shortages and price spikes
Impact of rising interest rates on loans
Sponsor segment: Gatorade
Market slowdown vs. high profitability
The K-shaped economy in the auto market
New revenue streams: subscriptions and used cars
Sustainability of pricing out budget buyers
Slate Auto: a minimalist EV truck
Future of car ownership and new car luxury
Outro and McDonald's ad
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