(Disclaimer: The opinions expressed in this column are those of the author and do not necessarily reflect those of The Augusta Press.)
The automotive industry is going through a tough phase at the moment as 2022 was a challenging year for most manufacturers, resellers, dealers and customers.
Don’t expect the turbulence to abate anytime soon.
The industry seemed to change monthly due to supply chain issues, economic stresses and buyer sentiment. This uncertainty left many experts scratching their heads and wondering what new disaster would show its face.
Historically, the automotive industry has had peaks and valleys, the most prominent being in the early 70s. I have been studying this era recently through reading several books from automotive leaders who were there in person.
The biggest misconception of that era is that the manufacturers had no idea what people wanted in their driveway. This couldn’t be further from the truth.
The big three domestic manufacturers knew exactly what America needed, but it didn’t line up with their legacy. Cars got bigger, more wasteful and looked terrible.
MORE: MotorHeadline: Of mice and motorcars
Bigger car, bigger profit was the industry standard and some vehicles rivaled the Duesenbergs in wheelbase and weight, but lacked the horsepower.
“Duesies” they weren’t.
In the 1970’s, innovation was canned for implied market dominance. The arrogance of the Big Three American carmakers brought rise to the import manufacturers providing a quality car at a fair price.
The onslaught and consumer embracement of foreign cars sent most American manufacturers into the darkness, in which some never recovered. By the time the domestic market caught up with buyers, it was the middle 80s, and now they had real competition in companies like Toyota, Honda and Nissan.
I believe we are deep in another valley yet again in 2022, which is a very different time than the 1970 “malaise” era. There is no excuse for car companies to put out a vehicle that people do not want, unless of course it is the “legacy arrogance” that was so prevalent in the last valley.
The amount of research that can be done for very little money should surely tell these executives exactly what the car buyer values and what they will pay for it. Manufacturing processes have advanced to make a quality product.
So how is anyone still making a bad car?
The average new price for a vehicle sold in 2022 was $47,681, according to Edmunds. This is the highest it has ever been, but why? Mostly this has come from lack of inventory, new technology added to vehicles and buyers wanting a nicer product with more features.
Any way you slice it, that is a lot of money for anything, even a car. To add insult to injury, some of the existing features have to be “unlocked” by paying an extra fee.
In 2023, analysts are expecting new car sales will increase slightly, after decreasing steadily for the last two years. Buyers will have to weigh higher interest rates, inflation concerns, and shrinking investment accounts from a looming recession into their purchases.
The used car market for the past year has overextended its hand, and we will see a decrease in prices by around 20% according to projections by JP Morgan. Companies like Carvana that thrived in used car speculation are now coming apart at the seams due to this bubble starting to burst.
MORE: MotorHeadline: The female demographic is back in the automaker’s radar
New technologies, especially battery operated vehicles, will be in full force at trade shows and automotive journalist’s headlines in the new year. Expect to see this technology being applied to only higher end vehicles until the supply chain issues evaporate.
As we auto technicians try to keep up with this technology and the tooling it takes to repair, higher repair costs are coming to the consumer. I also expect to see more recalls and service bulletins applied to most of the higher tech vehicles.
While this seems like a negative, growing pains are part of technology advancement and manufacturers voluntarily fixing these issues will continue to help their development. 2022 was a record year for recalls for a few major manufacturers and I don’t see that changing in 2023.
The good news is I see 2023 being better for the car buyer, new or used. I also see some manufacturers, like Toyota, Ford, GM, and Hyundai/Kia that are making some policy changes that are in line with what I believe is in the best interest of their customers.
I would hope that there are some automaker “New Year Resolutions” that turn out to be revolutions, in policy, thinking and design.
As for me, I will see you on the road!
Taylor Bryant is an automotives instructor for Augusta Technical College.
