EDMUNDS SHOCKS The Auto Industry (SCARY NEW DATA!) | Episode 980
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Company
Chevron with Techron
Chevron with Techron is a type of gasoline that includes special cleaning ingredients. These ingredients help keep your car's engine clean and can improve how well it runs.
Term
MSRP
MSRP is the price that the car maker suggests you pay for a vehicle. It's like a starting point for how much a car should cost, but dealers might charge more or less than this price.
Concept
dealer markup
Dealer markup is when a car dealership charges more than the suggested price from the manufacturer. They do this to make extra money, especially if a car is in high demand.
Car
Hyundai Genesis
The Hyundai Genesis is a fancy car that feels really nice to drive and has a lot of cool features. It's a good option if you're looking for a luxury car without the high price tag of more well-known brands.
Concept
SUVs
SUVs are larger vehicles that can carry more people and cargo. They are popular because they are seen as safer and more practical for families.
Term
advertising
Advertising is how companies tell people about their cars. They use ads on TV, online, and in other places to make people want to buy their vehicles.
Concept
profit margin
Profit margin is how much money a company makes after paying for everything it took to make and sell a car. If they make a lot of money on a car, they want to sell more of those cars.
Term
manufacturer suggested retail price
MSRP is the price that the car maker suggests dealers sell the car for. It's a guideline for how much you might pay, but you can often negotiate a lower price.
Term
transaction price
Transaction price is the final amount someone pays when buying a car. It's important because it shows how much people are actually spending, not just what the car company suggests.
Car
Hyundai Palisade
The Hyundai Palisade is a family-friendly SUV that has a lot of space inside for passengers and cargo. It's known for its modern features and comfort.
Car
Hyundai Telluride
The Hyundai Telluride is another large SUV from Hyundai that offers a lot of space and comfort. It's similar to the Palisade and is also designed for families, making it a great choice for road trips.
Car
Kia Telluride
The Kia Telluride is a large family-friendly SUV that offers a lot of space and comfort for passengers. It's known for being safe and affordable, which makes it a great choice for families looking for a reliable vehicle.
Term
dealer fees
Dealer fees are extra costs that car dealerships might add when you buy a car. They can include things like paperwork fees and other charges.
Car
Mazda Cx30
The Mazda CX-30 is a small SUV that's higher off the ground, which makes it easier to get in and out of than lower cars. It's popular for its good looks and fun driving experience.
Car
Mini Clubman
The Mini Clubman is a small car that looks unique and has more space than a regular Mini. It has extra doors at the back, making it easier to access the rear seats and cargo area.
Concept
fleet sales
Fleet sales are when companies or organizations buy many cars at once instead of just one or two. This is common for businesses that need cars for their employees or services.
Car
Honda Passport
The Honda Passport is a type of SUV that is larger and can handle rougher terrains. It's designed for families and people who need more space and utility.
Car
Toyota Sequoia
The Toyota Sequoia is a large SUV that can carry many passengers and has a lot of space for cargo. It's great for families and people who need to tow things like trailers.
Term
K-shaped car market
The K-shaped car market is a way to describe how some types of cars are selling really well, while others aren't doing as well. It shows that different buyers have different needs and wants right now.
Car
Honda That Honda
The Honda That's is a small car that is easy to drive and great for city streets. It's designed to be practical, so it has a lot of room inside for passengers and their stuff, even though it's not very big on the outside.
Car
Honda Civic Hatchback
The Honda Civic Hatchback is a type of car that has a rear door that swings upward, making it easier to access the trunk space. It's a popular choice for people who want a compact car with more room inside.
Term
out-the-door price
Out-the-door price is how much you will actually pay for a car after adding everything together, like taxes and fees. It's the total cost to own the car once you buy it.
Term
OTD
OTD is a shorthand for out-the-door price, which means the total amount you'll pay for a car after everything is added up. It's a way to make sure you know the complete cost.
Car
Mazda Cx5
The Mazda CX-5 is a smaller SUV that is fun to drive and looks nice inside and out. It's a good option if you want something that feels sporty but still has enough room for your family and gear.
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Now, Dad.
Yeah.
The big story today comes from our friends over at Edmunds.
They produced, similar to what we have a video coming out soon, their 2026 market
projections, three trends that will shape the US auto market in 2026.
New vehicle sales are expected to reach 16 million units in 2026.
They're persistent affordability pressures.
And Dad, we've got some scary new data and some scary thoughts for what the auto industry
looks like in 2026 from the folks over at Edmunds, you're ready to jump in?
Let's do it.
All right.
We'll see if my dad agrees or disagrees.
The first point we want to look at, who is this guy?
You know, pause your video.
No, you are not my father.
My father is my father.
What I want to look at here, Dad, is the first point they have.
A K-shaped divide driven by affordability.
That's the first trend that Edmunds thinks is going to happen in 2026.
This means, Dad, that they think that high income buyers will remain the shoppers in market
purchasing high-priced vehicles and we're going to push even fewer, push even fewer
shoppers out of the market that have access to fewer more affordable vehicles.
What do you think?
What does this take of a K-shaped divide for affordability?
If you're asking me, do I believe that new car prices and the average new car prices will
remain high and realistically only appeal to the top 12% to 15% of the American population?
I do.
That's not in a sense that I'm ready to get married.
I'm just saying, I do.
I think a lot of what's informing the thoughts over at Edmund would be some of the data we
have coming out right now from Cox Automotive.
The share of new vehicles under $30,000 falls to 7.5% of November sales.
Edmunds is making the big, bold bet here, Dad, that we are going to see more and
more high income, well-healed shoppers supporting the auto industry and fewer and fewer
of those people that can't afford more affordable vehicles actually being able
to purchase.
I think this is a big, bold bet and one that we definitely agree with.
There's a divide between the HABS and the HAVNOTS, and affordability will be a huge
storyline in 2026.
The chasm between the HABS and the HAVNOTS has grown wider in the six years that we've
been doing this.
With the dramatic increase in MSRPs that we saw that were driven during COVID times, when
dealers were adding huge additional profit markups, the manufacturers looked at that and said,
well, if the dealers can get the customers to pay an extra $10,000, $15,000, then perhaps
rather than letting the dealers make all that money, we should just produce more expensive
cars, and so that's what they did.
Now when they did that, they did abandon a larger part of buyers out there and basically
said to them, we don't care about you anymore, we like you.
We just don't like you enough to produce vehicles that you can actually afford to
buy.
Just use cars for you, enjoy them.
And do you think that that will continue in 2026?
Obviously, the data from 2025 shows that you can see here, and then says clearly, the average
days to turn vehicles with an average transaction price over $70,000 was 61 days, almost identical
to the 60-day pace for vehicles priced below $70,000.
So $70,000 plus average transaction price vehicles are turning over as fast as the
whole auto market is, which is just crazy.
That's because there's that percentage of the population that can afford it, and they're
out there buying, they're out there spending their money on those cars.
So I don't see anything dramatically changing where it's going to become more affordable
for more people to be able to participate in the new car market.
Hopefully, it becomes more affordable for more people to be able to participate in
the used car market.
But I don't see any indications at this point that the manufacturers are considering pulling
back what it is that they're building so that they could build lower-profit margin
vehicles for the rest of us.
I just, I don't see them making that decision.
Yeah, I agree, Dad.
Now, let me continue on here, and the chart below is absolutely, it's just mind-boggling
when we look at it in just a moment.
luxury shoppers aren't defecting to lower-priced brands, loyalty remains high with 64.2% of
luxury owners trading in for another luxury vehicle compared to 65.9% in 2024.
So folks are not choosing cheaper, more economical vehicles when they trade in those luxury vehicles
or just getting into another luxury car.
Cars accounted for just 17% of the market in 2025, underscoring the continued dominance
of SUVs and trucks.
Again, this chart in a second here is about to show that it is just mind-boggling.
And the once mighty mid-sized sedan segment shrank further to just 4.5% of share in 2025
down from 5.3% in 2024.
So some of your more affordable vehicles may be in these segments that are shrinking in
terms of popularity in the United States.
And Dad, look at this chart from 2025, excuse me, from 2005 to 2025, you're looking at
the percentage of vehicles that are made up by these different types of segments.
You've got cars are the dark blue, which back in 2005 represented more than 40% of
vehicles sold work hard back in 2010, more than 40% back in 2015, more than 40%.
You can see now we're at that 17% in 2025.
I'll get the comments off the screen for a second here.
SUVs, that's the teal line that has gone up into the right significantly trucks.
The purple line has also gone up into the right, but it's been a little more stagnant
and then obviously bands relatively small percentage.
It's SUVs man, the proliferation of more expensive SUVs and we see this across
nearly all manufacturers will do a live experiment on the fly, caredge.com, go to the car search,
drumroll please, let's type in, we don't even have to type in it, defaults for me here at a
Genesis and we've got $85,000 advertised price and $84,000 MSRP, 58,000.
These are SUVs that are just freaking expensive, man.
There you have it, it is, I think what that chart really shows is the power of marketing
and what do I mean by that?
When you look at that chart and you see the enormous growth in SUVs,
that so much of the population has decided they need an SUV, why have they decided that?
Because that's what the manufacturers have been advertising and marketing and pushing on them
consistently via digital advertising, television, radio, everywhere you look.
Now, why have they decided to push those cars?
They're the highest profit margin vehicles that they build, so they believe it is in their
stockholders' best interests for returns to just continue to grow that market at the expense
of the more affordable sedan market.
Why were sedans big at one point in time?
Might have been marketing, where they spent the billions of dollars marketing the sedans
to the American public, and then they realized they could grow profit margins by growing the size
of vehicles again, and that's what I think part of the issue is.
Yeah, I think there's some efficacy to where they spend their marketing dollars,
but I actually agree more, whoops, here with Orange Robert Duckey.
I think it's more the comfort.
People prefer these bigger vehicles.
Dad, how can you give me that face?
You're a data point of one.
I'm a data point of one.
You think it's marketing?
I think it's people prefer to be sitting up high.
They feel safer in the road, et cetera, et cetera.
Deeper into that, why do they feel more comfortable that way?
Because they have been conditioned to believe that through advertising and marketing dollars,
it is the wonderful thing about marketing and advertising is designed to impact how you
think of things.
It's designed to impact how you want things.
Okay, so if it is presented to you on a daily basis, if you are bombarded on a daily basis,
that what you need in your life is a big-ass SUV because it's more comfortable and it's safer,
at a certain point you believe it, whether it's true or not.
And so I think there is great control of what it is that we get to consume
media-wise as far as marketing dollars for vehicles and that impacts how we perceive these things.
Perception is reality.
So right now, the perception is that big-ass SUVs are more comfortable and safer.
So that's the perception, so that's the reality.
Whether it's true or not is unimportant in many people's minds.
The vast majority of shoppers out there, that is their reality that the SUVs,
the big-ass SUVs are going to be safer and more comfortable.
Whether they are or they aren't is irrelevant.
I disagree with you, but that's totally fine.
Let's keep going here with the Edmunds data, Dad.
The bright spot they say heading into 2026 is the easing of interest rates.
So in November, the average APR in a new vehicle loan Edmunds said was 6.6% the lowest point
of 2025.
There's a lot of expectations, Dad, that interest rates are going to go down next year.
That'd be a good thing for the auto industry if they do,
but they anticipate and they expect that average transaction prices, they won't change that much.
Edmunds' expectation is that average transaction prices, which when you look at this chart,
I know I'm covering up where it starts at 2015.
You can see it down there.
It's kind of crazy how the slope of this line, how aggressive it is.
That being said, Dad, interest rates are another storyline for next year and the expectation
that interest rates will increase automotive sales because they'll make things more affordable.
You and I both are fairly opinionated about this.
We don't see that having as big of an impact as many people think.
No, I totally disagree with that.
We just saw the Fed lower the Fed rate yesterday by 25 basis points.
We know that if there's a 25 basis point drop in the average APR, that's going to have a
maybe a three or a four dollar a month difference in your monthly payment.
So if the average car payment today is $750, tell me that if a person can afford $750,
they'll suddenly be able to afford $746 or $747 because of that 25 basis point drop.
I don't think so.
So I believe that the industry waiting on interest rates to drop
so that it can significantly impact the affordability of these overpriced cars
is just the folly on their part.
You notice that the price of the vehicles keeps going up.
So there isn't a big enough drop in what the Fed rate would be to compensate for the
increase in the price to adequately address affordability.
So unless they're going to change the dynamics of what it is that they build
and how it is that they push what it is that they build, and unless they want to bring those
prices back down into the $30,000 to $35,000 price range where it had been prior to COVID,
the affordability issue is not going to be addressed at all.
Yeah, I completely agree.
Dad, now one other dynamic in this, we're going to talk more about the admins
data in a second, but one dynamic tied to this is access to credit.
Because if you can just make it more accessible to approve people for auto loans,
then it doesn't really matter how affordable it is on a monthly basis.
You just widen the pool of potential, I don't know, whatever people who can make the decision,
whether it be a savvy or unsavvy decision to take on that debt,
you just increase the number of people in market.
And so dad, we have the latest data from Cox Automotive.
It came out just yesterday.
Auto credit access reaches 2025 high in November.
We'll look at some of the data points here and talk about what impact this has on the industry.
Approval rates.
The approval rate for auto loans rose to 73.6% in November,
up 1.6 percentage points from October,
and up 100 basis points from November last year.
Approval rates increased in November after two consecutive months of decline.
So we saw two months of tightening.
And what impact does that have on the auto industry?
Takes people out of the market because most people are not cash buyers.
They finance the purchase of this vehicle.
So then what do we see in November?
We see a loosening and opening up of the market.
We're going to talk about subprime here in a second
because there actually was a tightening in subprime.
But overall, we just get more people back in the market
because we approve more auto loans.
You've always said it.
Just because the bank approves it doesn't mean you should do it.
No.
And trust me, one of the lines that an FNI manager is going to share with you
when they're trying to close you on buying the extra product
and having your payment go up is,
well, you don't think the bank would have agreed to do this
if they didn't think you could make the payments.
Well, you know, you know whether or not you can afford to make the payments.
The bank doesn't.
But what it shows is that as approvals declined in September and October
and banks were lending less money, they suddenly said to themselves,
we need to lend more money because it's in our best interest
to have more money floating out there on loans.
So what do you do when that happens?
You ease your lending requirements to a degree.
You approve more people for loans and for larger loans
than perhaps they really can afford
because you need to have more loans out there
so that it can positively impact your profit structure.
It is.
And then the other thing we see is the keep extending loan terms
in order to make it appear as if the monthly payment
is affordable when you are paying back significantly more interest
to have what appears to be a more affordable monthly payment.
It is such a vicious circle.
And it would be nice if people would realize
what it is they're signing up for
and maybe perhaps stop signing.
Yeah, I completely agree.
It's worth noting the other data point
from that Cox Automotive information.
If you've got a 330% basis point increase year over year
in 72 months or longer loans.
So you just got more and more people taking on
longer and longer loan terms.
So we're going to come to the chat here
in just a second before we do a friendly reminder.
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And I noticed we had a new release today, Dad.
Looks like the car search results
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We've got the manufacturer suggested retail price
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Love seeing the things that the team are doing.
Also, I want to click into one of these.
Did we release the other thing that I'm thinking we really did?
Oh, yay.
We've got a new update on our vehicle detail pages,
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It gives you all the information you need
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This is so cool.
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And if you have CarEdge Pro,
you can initiate the AI agent
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Nice. Love this when we hop on the show
and there's all sorts of new stuff.
Anyway, folks, check it out, caredge.com.
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This one I think we completely agree with.
This actually isn't that much of a hot take.
This would be an absolute cold take.
You didn't need any more proof of that
than EV sales in October and November
declining dramatically from EV sales
through the first nine months of the year.
Why? What happened at the end of September?
The federal tax credits went away
for EV purchases.
And so naturally, you're going to see a slow down in EV sales.
Doesn't mean that they're going away.
Okay.
Doesn't mean that there is in a certain subset
of customers out there that want
and will continue to want battery electric vehicles.
Those customers will exist.
That number might eventually grow.
But for the short term,
that number is going to contract to some degree
as ICE vehicles will remain a tad bit more affordable
for most folks.
Let's look at their third take, Dad,
which is off lease inventory will rebound in 2026,
offering shoppers affordable used alternatives
to 2025 market lacks.
So this is an interesting take
because we've been saying out loud for a long time
a pretty doggone hot take,
which is if you are thinking about buying
a one or two-year-old used car
and you want to be a value shopper,
actually get the new car,
which is crazy because pre-pandemic,
that was not a sentiment that existed.
You always buy the used car
because it's depreciated relative to the new car.
Edmunds is saying here, Dad,
that in the market next year,
used car shoppers will have more affordable options
because off lease vehicles
will be finally hitting the market.
What's your take on this?
And also, feel free to explain this as well.
Maybe I haven't done a good job
making it clear why they think
this is going to happen.
Well, you know, I would tend to disagree with them.
And the reason I would tend to disagree with them
is because we know lease penetration
as a percentage of sales for the last several years
has been much lower than what it historically had been
in the previous five or six years before COVID.
So you have less lease vehicles happening,
which means you have less leases coming due.
The number of leases that'll be coming due
will still be significantly lower
than what it had been prior to COVID times.
So if there is a slight increase in lease returns,
what that means is that we will have
a slightly greater availability
of two and three-year-old lower mileage,
younger used cars available.
Do I suspect that with that slight increase
that we're going to see a significant decline
in the pricing for those vehicles?
I do not.
And the reason I do not is we know
that the new car prices continue to creep up.
So if new car prices continue to creep up,
the relative asking prices
of those two and three-year-old used cars
will continue to creep up with them.
So I don't think there's going to be a significant increase
in lease returns making it to the used car marketplace.
But whatever increase there is
will be a good thing for people
who are looking for a two or three-year-old younger used car.
It is worth mentioning that used car average
transaction prices have been kind of sort of flat
over the past year.
We can come here.
Edmunds puts out great data on this year over year.
The average transaction price for a used car
is down 5.8 percent.
So it's actually gone in the right direction.
We're at an average transaction price of $25,814,
whereas the average new car transaction price,
as we know, is creeping its way on up to $50,000.
So maybe just maybe that trend can continue a little bit.
But I generally agree with my dad here.
I don't anticipate.
I believe, statistically speaking,
that those two and three-year-old cars are much closer
in price point to the brand-new cars
that the spread is, in many cases, not significant enough,
which is why many customers will buy the new car
with the full warranty by paying a few thousand dollars more
than trying to save a few thousand dollars
on that pre-owned car that's running out of warranty.
Yeah.
The spread needs to be wider than it is
and wider than it has been.
Perhaps this will impact it slightly,
but I just believe that the used car shortage,
as we know it, will continue through the end of the decade
till things really stabilize back in the used car side of things.
You know, there were 10 to 15 million new cars
that were scheduled to be built during the COVID times
that weren't built.
So there were cars that never got built
so they couldn't get sold, so there weren't any trade-ins.
So that impact will last longer than people would like to admit.
Now, let's come here to the chat we've got from Jenny.
Thank you, Jenny, for the contribution.
The same Hyundai Palisade that I wanted
went from 40,000 to 50,000 from last year.
Hyundai, what the heck?
We've seen that these manufacturers increased their MSRP significantly
and increased the proportion of vehicles
that they wanted to produce to be the higher content vehicles.
Let's do another little live experiment.
We were on, obviously, before Genesis vehicles
over on the car edge, car search,
but let's come over here for a second.
And let's actually look at this, Dad, for Hyundai.
Yeah.
And this was a telluride, correct? Palisade.
It was a Palisade.
Palisade.
So now let's just, nationwide, Hyundai Palisade.
Let me remove this comment from the screen
so we got a little more space here.
MSRP $47,620.
Dealers advertising it for $45,496.
$48,000.
$40,000.
I mean, we're just the first row of results here
and Jenny's spot on it.
It's now a $50,000 vehicle.
Oh my gosh, look at some of these.
$61,000, $61,000.
This is for a Hyundai, man, $61,000.
I mean, this is, we do this stuff live, y'all.
This is crazy.
I think the word you're looking for is,
some of those prices are absurd for us.
Well, look at this, Dad.
This is why you have strong leverage, right?
I clicked on one of them.
That's $58,000.
And we can say $50,000 in one day supply inventory
because there's 89 of these for sale,
but only eight have sold in the last 45 days.
So these new 26s that these dealers are trying to sell
that have gone up in price significantly year over year.
This one's already been sitting for 92 days.
This is a great candidate to be,
this is a great vehicle to reach out to the dealership
and secure that discount.
It just seems like almost $60,000 for a Hyundai is ridiculous.
There's so many other vehicles with better reputations
and better quality that fall into that same price category.
The South Korean brands were supposed to be
an inexpensive vehicle offerings,
and they were supposed to be less expensive
than their Asian counterparts or the domestic vehicles.
And suddenly they've decided,
and Hyundai seems to be getting away with it,
so does Kia, that they've decided they're on par
with the top end Asian brands.
And so they should charge the same type of pricing
as Toyota and Hyundai.
And apparently they can get away with.
Let's check that because I'm curious.
We haven't looked at incentives.
Let's see, what are the incentives right now?
Yeah, they're getting away with it.
There's not a big cash incentive.
3.99% for 36 months is not that aggressive.
A lease rate of 5.4%, so a money factor of 0.00225.
That's not that aggressive.
It's when we look at the market insights, Dad,
that we can really see that maybe they're
getting away with it right now.
But this dealer who's had this vehicle for 92 days
and in their market area, we can see here,
what is this?
This is within 100 miles of this one,
only 89 of the same year-make model trim are,
or excuse me, 89 are for sale.
Yet in that same area in the last 45 days,
only eight have sold.
Yeah, Hyundai is getting away with it,
but this dealer, Dad, if you're a dealership,
if you're a sales manager and you see this
as your market insights, you're not getting excited about this.
I'm questioning when I'm going to see
better incentives from Hyundai,
and I'm questioning what my profit structure
might look like on any deal that I make
in order to get rid of a vehicle like that.
That's what I'm questioning.
But this is just a prime example
of how ridiculously priced these vehicles have become.
And why?
Because these are their high-profit margin vehicles.
And, Dad, to that point, they pushed them.
To that point, though, we've got here
from Daniel earlier in the show.
Thank you for the kind contribution.
Great job, guys.
But it's not just marketing.
I'm older with bad knees and a bad back,
and it's hard getting in and out of low sedans
a little higher is much easier for me.
So this is a counter argument to your comments earlier down
where you were very explicit that you think that marketing
is the thing that these manufacturers
do to influence our thinking.
We've got a counter argument here from Daniel.
It's actually comfort.
I get that.
Why do I drive what I drive?
Because the Mazda CX-30 sits up higher
and was easier for me to get into and out of
than my own Mini Clubman.
Okay.
But we, us older folks,
represent a smaller percentage of the overall market.
And you look around, and it's not just us old folks
that are driving these vehicles that sit up higher.
It's young families.
Dad, I think it's such an incongruent argument
to say that young people also
don't want to be more comfortable.
I have a bad back.
I've slipped a disc in my back.
And I'm 19.
I'm 30.
I've slipped a disc when I was 19.
Like, I hear you.
Let's not debate it too much.
Young people and old people can want to be comfortable pops.
I think that's worth resonating.
Yeah, I'm, yes.
I agree.
Everybody wants to be comfortable.
From Rich Diana here, everyone also wants that Lincoln
because of, well, who's the guy who did those commercials?
Cynthia.
Matthew McConaughey.
Matthew McConaughey, yeah.
All right.
You know, I don't want to listen to Lincoln
because of him.
We've got from Rich Diana here.
Thank you, Rich.
We appreciate it.
Imagine how successful you guys will be
when the economy recovers.
Keep it going.
Yeah, what will happen to our business
when more than 15% of the population
buy a TM car then?
What do we do then?
How do we celebrate?
How many bottles of champagne
are we going to have to crack open?
With the unfortunate reality,
I don't see that happen in any time soon.
Yeah, maybe next decade, maybe in the 2030s.
I mean, if you read through that Edmunds data,
you know, they're predicting 16 million
new car sales for next year,
which is below the number that this year
is going to end at.
So, what they're predicting when you hear
the 16 million sounds like a lot
until you realize, well, the total sales
for this year expected to come in
around 16.3 million.
So that's 300,000 less vehicles,
new vehicles that Edmunds is expecting
to be sold next year.
That's not moving the needle
in the right direction.
And from the most recent data
we looked at the other day,
we know that fleet sales are up.
So it's not even retail customers
that are buying the damn cars.
So that means even fewer people
are going to be in the market.
So you can paint as rosy a picture
as you want, but the reality is
that this stuff's moving backwards, not forwards.
And it's been like this for decades.
The auto industry, retail auto industry
has been in a plateau for a long, long time.
We've got here from Jenny again.
Thank you, Jenny.
Ray, yup.
And Honda wants nearly $60,000 for their passport
in Kansas City, Missouri.
Holy cow, Honda getting expensive.
Honda getting expensive.
It's nuts, man.
It's absolutely not Toyota.
We were talking about fastest selling cars recently.
The Sequoia is up there.
It's an $83,000 Toyota.
And it's one of the fastest sellers in the country.
Yes, no way.
That's that K-shaped car market.
Yes, yes, absolutely.
I mean, I keep referring to it as the rest of us
because I don't feel like I'm part of that,
that 13 to 15% of the people
that can actually go out
and buy a vehicle that approaches $50,000.
I mean, the vehicle I bought, gee, gee whiz.
That approached the whole $34,000.
I mean, so I am a single person.
And I make a decent living.
And I don't understand how married people
with kids can afford to buy those $70,000, $80,000, $90,000 SUVs,
whether it be a Honda Passport at $60,000
or a Palisade at $50,000
or a Toyota Grand Highlander at $65,000.
How do people do it?
Where does it come from?
How do you budget $750 a month for your car payment?
$150 to $200 a month for your insurance payment.
$150 a month for fuel.
$100 a month for maintenance.
Where, when you add it all up, how do people do that?
Oh, and then you have either rent or a mortgage.
And you have kids.
And so there's all kinds of crap
that you have to buy for your kid.
How do you do it?
And we haven't even talked about groceries.
How do you feed a family of four and do all that?
How much money do you have to make in order to be able to do that?
Cars obviously have gone expensive, folks.
That being said, we know you tune in a lot of you
because you're in the market.
So again, a friendly reminder that we provide services
and products to help you save money
during that car shopping process.
And again, when you own your vehicle as well,
whether it be the extended warranty or insurance,
and really want to just make it clear,
we're on your side here.
Our car buying service is $150 off right now,
and Car Edge Pro is 15% off.
And I want to again demonstrate
some new things that you get with Car Edge Pro.
You're on the Car Edge car search.
Let's say you're in the market for that Honda.
You're using the car search.
You find a vehicle you're interested in.
Sure, this new Honda Civic hatchback.
The way Car Edge Pro works
is it's going to give you this overview
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on that particular vehicle.
So you can see here,
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et cetera, et cetera.
And then on any vehicle with Car Edge Pro,
you can actually initiate your AI agent
to reach out to that dealership on your behalf.
What does that ultimately look like?
You have a dashboard where you can then
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Ultimately, what this is going to yield for you
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So all of your attachments come into one place,
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And the agent will negotiate down the price
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Your agent obviously will negotiate an out-the-door price,
but you can still put in a monthly payment goal.
So please, folks, take advantage of Car Edge Pro.
It's been incredible to see the results
that our community is getting here.
It's from Neil, Car Edge Pros and Excellent Valio.
I subscribe to Car Edge Pro
applying the information gained through the subscription
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And then if everything I just shared with you
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use the car buying service, $150 off right now.
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This is a car buying service where you pay us,
you are our customer.
There are a lot of programs out there
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So you then have to negotiate
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They're charging you and they're charging the dealership.
We do not do that.
We work only for you.
And again, I'll jump back over here.
Let's scroll down from Rick here.
Joe was professional and quick to make things happen.
Started on Tuesday, owned my 2025 Mazda CX-5 Turbo.
On Friday, learned the buying process, great experience.
We do this day in and day out.
This month, that will probably be 500 car deals
that Car Edge concierge does, which is incredible.
And get a free consultation call.
Talk to our team and see if this is a good fit for you.
And meet the team that are doing all these deals back at caredge.com.
Okay, that was my big promo.
Thank you everyone for letting me get through that.
Yeah, but the stuff's good, man.
The stuff's really good.
Six years in, we've started to really hone in
how we can help people navigate this.
Absolutely.
I couldn't agree more.
Oh, yeah.
And Igor's spot on.
We also have a totally free forum, caredge.com slash community,
where you can get help in real time.
Incredible group of people over there.
Igor himself spaced so many others.
So please, you can commute to the forum as well.
It is the amount of free stuff that is available is staggering.
Some of the stuff that you have to pay for, I'm sorry.
You know, there's costs associated with building all this stuff out.
It ain't free for us to build all this stuff out.
So, you know, there's some things you have to pay for.
The vast majority of it is absolutely free.
The community forum is a forum that everybody should participate in.
You get more information from those folks
than you'll ever get from Zach and I.
I hate to break it to us.
You've got an incredible...
We are so fortunate to be the figureheads
of an incredible movement here
to make the auto industry more transparent,
more fair, and more efficient.
Folks, thank you so much for tuning in.
We're back tomorrow with another episode of Car Edge Live.
Dad, enjoy the afternoon.
I really hope you have a good one.
And guys, this Ford video we've got coming out next week,
we met earlier today to game plan for that whole week.
How last year we did, we emailed 104 dealers
to get pricing and ultimately Ford to call us saying,
oh, what the heck happened here?
I think some crazy stuff is about to happen
before Christmas comes.
So, can't wait for that to drop.
We appreciate everyone.
Tune in again tomorrow.
Bring a friend.
Dad, I love you.
Love you too, handsome.
Thank you everybody for being here.
We'll see you back here tomorrow.
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About this episode
Edmunds' new market projections for 2026 reveal a concerning trend in the auto industry, highlighting a K-shaped divide in vehicle affordability. High-income buyers are expected to dominate the market, while fewer affordable options remain for average consumers. The episode discusses the implications of rising new car prices, the dominance of SUVs, and the potential rebound of off-lease inventory. The hosts debate the effects of interest rates on sales and the accessibility of auto loans, emphasizing the ongoing challenges for consumers seeking affordable vehicles.
Original notes
Today on CarEdge Live, Ray and Zach discuss the latest news from Edmunds. Tune in to learn more! Hosted by Simplecast, an AdsWizz company. See https://pcm.adswizz.com
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CarEdge Live
Ray and Zach Shefska, Bleav
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