Only $600 Per Month to “Subscribe”!

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Here’s a look at the Future of Transportation, also known as “transportation as a service” – the new business model that is being pushed hard by several major car companies, for the obvious reason that they stand to make a lot more money doing business this way.

The idea is that instead of selling you a car, you pay to rent cars – plural. Rather than a single monthly payment toward ownership of a single car, you pay a monthly subscription fee – ongoing – to never own any particular car but to have the use of several different cars.

Cadillac calls this “experience the brand.”

Volvo just announced a similar offer and  . . .such a deal!

For only $600 per month, you get to subscribe to a base trim 2019 XC40 – the company’s entry-level, compact-sized crossover SUV. At the end of 12 months, you can upgrade to an R-Line for $700/month.

This sum is in the ballpark of what you’d pay to own something larger and nicer – a new BMW X5, for instance. It stickers for about $57k to start. Finance that over six years and you’d own the thing at the end of the deal; have some equity in the thing, too. Subtract that equity from the 72 months of payments and you are paying less to own the larger/nicer X5 than to have 24 months’ use of an XC40.

But hey, the subscription fee does include insurance, maintenance and “concierge” services.

Will people buy in? Why not? People have already become comfortable with never-ending debt, the perpetual payment. With never building equity in anything. Not their homes, not their cars. Leasing – at one time a small slice of the market – now accounts for about 30 percent of the market (see here). This has happened for two reasons: The first is that leasing makes it financially feasible to drive “more car” than a person could otherwise afford to drive – assuming he had to buy the car rather than rent it for a time – and the second is that more and more people are ok with the idea of never owning a car – and never being without a monthly payment.

These “subscription” plans leverage this economic dementia, take perpetual debt to the  next level. Shorten the contract interval; jack up the price.

Really stick it to ’em. But market it to them. Tell ’em they are “experiencing the brand” or – as Volvo styles it – receiving special “care.” (The Germans once used that term, too – in a slightly different context.)

“This is a national program, not a pilot or a test,” says Volvo North America CEO Anders Gustafsson. “Everyone wants to simplify, and we handle and balance this all on our own books.”

But “simplicity” has its price, eh?

The included maintenance thing, for example. It’s largely a non-issue with a brand-new car. But most people are blissfully unaware of this. Blissful, that is, as far as the car manufacturers and dealers are concerned.

They are counting on the enstupidation of the typical car buyer and they are likely not counting wrong.

The first two years out, a new car might need a couple of oil and filter changes. Even assuming top-shelf synthetic oil/premium filters and someone else doing the job, it’s maybe a couple hundred bucks, total. Unless the car is driven Indy 500 style, constantly, that is the only maintenance it ought to need. Tires and brakes, for instance, shouldn’t need replacing before three or four years – long after the subscription is over.

Bu the marks don’t know this. They feel “secure” knowing they are “covered.” And in a way, they are . . . like a deer spotlighted by a redneck with an AK.

Concierge service means a phone number you can call to get help with various things – which sounds pleasant enough. But how much help, really, should be necessary with a brand-new car? One of the concierge services touted is that they pick up the car at your home or business in the event it needs  . . . maintenance – and then bring it back when it’s ready. But it’s a brand-new car. How often should anything need to be done to it except fill it up?

Maintenance and concierge service, then, are the equivalent of the next-to-worthless (because superfluous) paint/fabric protection scams dealerships used to use to peel more money out of the hides of marks. It’s the oldest game in the business, re-invented.

For $600 a month.

$700 a month if you “upgrade.”

To get a handle on the mark-up, on the milking Volvo (the entire industry, if they pull this long con off) has in mind, observe that you can lease a 2018 BMW X1 (a vehicle of the same type as the XC40) for $389/month for 36 months.

See here.

That is one more year – at $389/month – than Volvo wants to dun you $600-$700/month for to “subscribe” to the XC40.

But hey, you get paint protection/fabric protection thrown in. And insurance, too.

Speaking of which. . .

How is that going to work?

Generic coverage? This inevitably means more expensive coverage. Has to.

The way health insurance works provides the example. Thanks to Obamacare – another long con – premiums are not based on individual risk profile, with low-risk people paying significantly less than high-risk people, as of course it ought to be. That is considered unfair and so the low-risk (healthy, risk-avoiding) people get to pay more to cover the costs imposed by the high-risk (unhealthy, risk-incurring) people – the obese, smokers, diabeetus afflicted, etc.

All-included car insurance will work the same way – and probably accounts for a big chunk of the $600/$700 per month subscription.

Most alarming is the prospect of this becoming the way business will be done generally in the not-so-far-off future. That scams such as this will no longer be optional idiocy for the milking of the incorrigibly innumerate. Instead, everyone cattle-chuted into the “transportation as a service”/subscription model – experiencing the brand and being “cared” for . . .with automated cars providing the other half of the pincer.

Better buckle up. It’s going to be an interesting ride.

. . .

Got a question about cars – or anything else? Click on the “ask Eric” link and send ’em in!

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Author of “Automotive Atrocities” and “Road Hogs” (MBI). Currently living amongst the Edentulites in rural SW Virginia.

85 COMMENTS

  1. No ability to ‘Mod’ the vehicle means I will never use this crap, as I don’t lease for that very reason. I have not had ANY vehicle ( or anything else for that matter ) that can not be customized or ‘modded’ , this started with my 1st BMX bike in 4th grade and continues today. Bet the SEMA crowd just loves this idea /sarc

    • Hi Scarecrow,

      Yup – that’s an aspect for another rant. Worth a full rant. It is part of the push toward vehicles that own you – rather than the other way around…

  2. Obituary
    Romney Wordsworth
    1953-2017

    Romney Wordsworth, age 54, of Sector 3 of the Twilight Zone, was executed Monday morning January 1st. Romney is survived by his wife MargaretWordsworth and their only son Robert Wordsworth.

    Romney spent his life in defiance of the State. He spent his years as a builder, but was secretly a librarian. He harbored all the books that the State outlawed.Once discovered the State determined him to be obsolete and to be put to death.

    The State is still looking for Margret and Robert Wordsworth who have fled Sector 3. Any news on their whereabouts is to be reported to the Chancellor.

    There will be no funeral service for the deceased Romney Wordsworth. However, there will be a celebration on Saturday from 6pm to 10pm to celebrate the death of yet
    another civilian of obsolescence.

    Letter from Romney Wordsworth to his wife and son

    My dearest Margaret and Robert,

    I want you to know that I love you both very much. I never thought it would come to this. I know our time together has been cut short. I pray that you both were able to get away safely and undetected. I would have given anything to remain with both of you. It seems God had other plans for my life though. I trust he will guide you paths and keep you safe. I pray my sacrifice will count for something and that people will see that they can stand up against the State.

    If my death can accomplish that then it was not in vain. I can imagine all the fear and sorrow you are feeling right now. You must push through it to stay alive. Make smart decisions and don’t look back. Robert, I expect you to take care of you mother and to protect her. I raised you well and I know you will make me proud. Know that I will be watching over you and you mother. I love you both more than anything.

    Yours truly,

    Romney Wordsworth

    The Plot: In a totalitarian society, “logic is an enemy and truth is a menace.” Librarian Romney Wordsworth (Burgess Meredith) is facing the final 48 hours of his life; he has been charged with obsolescence, a crime worthy of the death sentence.

    The Goods: The episode is a grabber from its opening moment. The Chancellor (Fritz Weaver) stands at the top of a tall pyramid-shaped podium. Wordsworth is called in to face the charges against him in a courtroom that is stark and filled with shadows.

    What follows is an electric confrontation between the forces of good and evil. The Chancellor and Mr. Wordsworth argue back and forth, each one precisely articulate. The argument continues in Mr. Wordsworth’s room as he faces the execution of his sentence, and the end of his own life. Before that happens, Mr. Wordsworth springs a surprise on the Chancellor.

    Strikingly directed by Elliot Silverstein, this is an uber-serious episode, built around a super-charged issue. Rod Serling, who wrote the episode, delivers one of his finest scripts, an impassioned, deeply-felt howl against totalitarianism, as well as the attitudes and suspicions that lead to it. Meredith and Weaver are brilliant, making this one of the strongest, most mesmerizing episodes in the series.

    The Obsolete Man Script The Obsolete Man Written by Rod Serling

    ACT ONE

    Setting: A large board with a long table and humongous podium. On the side of the room are many government officials robotically and sequentially next to each other. At each end of the table is a microphone with one end having seat with a State secretary. Above the secretary, is a podium with the State Chancellor Standing at top with a grip of files and his own microphone as well.

    Secretary: Wordsworth, Romney, Obsolescence. (Turning to Chancellor) He waiting, Chancellor.

    Chancellor: Order him in

    Secretary: Wordsworth, Romney, Obsolescence.

    (A feeble man walks through two large doors. Behind him are other people awaiting their fate in a waiting room. As the two doors close, he is led by a guard to his microphone. His eyes have a look of confusion, awe, and fear as he looks around the word. The Narrator’s voice comes over the scene.)

    The Narrator:You walk into this room at your own risk, because it leads to the future; not a future that will be, but one that might be. (Camera pans to Narrator)This is not a new world: It is simply an extension of what began in the old one. It has patterned itself after every dictator who has ever planted the ripping imprint of a boot on the pages of history since the beginning of time. It has refinements, technological advancements, and a more sophisticated approach to the destruction of human freedom.

    But like every one of the super states that preceded it, it has one iron rule: Logic is an enemy, and truth is a menace.(Camera switches to the convicted man) This is Mr. Romney Wordsworth, in his last forty-eight hours on Earth. He’s a citizen of the State, but will soon have to be eliminated, because he’s built out of flesh and because he has a mind. Mr. Romney Wordsworth, who will draw his last breaths in the Twilight Zone.

    Chancellor:Wordsworth, Romney, Field Investigation Finding Obsolescence. Do you know why you’re here Mr.Wordsworth?

    Wordsworth: Yes sir…

    Chancellor: I’d ask you to speak up a little if you will, Mr.Wordsworth.

    Wordsworth: Yes, sir, I know why I’m here….

    Chancellor: You’ve been under investigation, Mr.Wordsworth for the mandatory period of 1 year and 11 months, you are found to be obsolete. The purpose of this hearing to make a finding in the matter and make a sentence accordingly. Do you understand that?

    Wordsworth: I understand that.

    Chancellor: Your occupation Mr.Wordsworth?

    Wordsworth: A librarian, sir….

    (Crowd jeers confusingly)

    Chancellor: (Puzzled and angrily)…..A what!?

    Wordsworth: A librarian, sir…

    http://www.freerepublic.com/focus/news/2289136/posts

    • I’m slipping! I hadn’t even gotten the Wordsworth reference when someone mentioned it before….and even now, my brain didn’t kick in until I saw the discrepancy between between the dates and the erroneous “54”.

      And I’m a Zone fan!!!! Best stuff Birdshits Meredith ever did! The Obsolete Man- a fitting sequel to Time Enough At Last.

  3. Hello Eric,

    My calculations make the Volvo subscription seem attractive relative to the BMW lease. I don’t think the relevant price comparison with the BMW X1 is $389/month, since, of course, there is money due at signing. Looking at your link, there is $3,925 due at signing in addition to the first month’s payment ($369), with $369/month for the remaining 35 months, bringing us up to $478.03/month over the lease term (and note that we aren’t discounting future payments and thus are biasing the calculation in BMW’s favor, since the payment up front is obviously more costly than having payments of the same nominal price over time). Looking at the fine print, we have to add taxes, registering and licensing fees. Also, there is insurance. If this website is to be believed (https://www.finder.com/car-insurance/bmw-x1-insurance-rates), the average price being paid per month for insurance for a BMW X1 is $179. Adding this to $478.03 gives us $657.03/month to lease a BMW X1 (plus taxes). $600 a month does seem so bad, does it? Or are my calculations missing something?

    • Lease offers are just as negotiable as purchase offers, so why pay MSRP?

      E.g., the national offer on a 2018 Subaru Outback is currently $239/Month for 36 months. $1,739 down.

      yet a local dealer is offering the same model for $229/month, $0 down, 36 months (under $250/month w/ tax)

      even with paying for full coverage insurance that’s far less than $600/month.

  4. Hopefully this will end very badly for the car companies, and they will abqandon the scheme or go bankrupt- as they deserve to.

    It’s amazing- At a time when wages are stagnant or declining for the majority of the population; the car companies come out with this scheme in which people will have a perpetual car payment, and no equitable interest in the vehicle; i.e. nothing to sell or trade when it is paid off; nothing to drive for 10 or 20 years without a payment (As if these computerized, delicate, unserviceable monstrosities would last that long!).

    And look at these things! I can not even look at many of these new cars without laughing. They look absolutely retarded. So many different categories of vehicles, yet they’re all just sawed-off little bubbles with no real trunks/cargo areas.

    Trouble is, when the manufacturers go bust from all of this nonsense…there will be no one to replace them.

    • Nunzio, that’s why I was all for the bailouts. The working people of this country are barely hanging on as is and if a major carmaker goes down it will be like the oil field turning off in Texas only over the whole nation. I can guarantee you people will be hungry, at least white people. When the price of oil dropped into the 30’s over 25,000 people lost their jobs in Tx. alone in the first quarter of 2015, not counting ag jobs and plenty of those were lost too.

      I’m a realist in realizing how far the effect of losing a major automaker will go and the salesmen who are mainly good bullshitters will end up with some better job than people who can do real work. I’ve seen it many times in Tx.

      • Yeah, but 8, if GM had met it’s end, as it should have, that would have opened up a vacuum in the market which would have been filled by other still-extant companies….who make a better product. Artificially propping-up a company that makes crap, and which is dysfunctional; and which real consumers reject, isn’t doing anyone any favors.

        Poor people shouldn’t be buying new cars (I don’t!)….and if they do, buying a Sonic isn’t going to improve their situation any…..

        If GM went away, the same number of new cars would still need to be made every year…so people who used to work for GM, would just be working for the other manufacturuers, who would be upping their production to fill in the void.

        But what’s likely going to happen now that GM has been “saved” and now has favored-son status, is that it will be able to perpetuate it’s dysfunctional practices, when in a free market, those practices would have caused their doom….only now, they are artificially propped-up, so they can do that and continue to exist, to the detriment of their competition who make wiser decisions. And ultimately, this will result in the functional car companies failing, while dysfunctional GM trudges on…and we are all the poorer for that.

        For a real-world scenario, ya just have to look at my nieces fambly. Despite being on food stamps and who-knows-what-else, they’ve been buying new GM cars every few years. The cars always turn to crap long before 100K miles (Not entirely GM’s fault. They get abused and neglected). But I know of no one else these days who perpetually blow engines in low-mileage late-model cars…. Every time they used to have a car catastrophe, they’d call me for advice. My advice was always Don’t buy bottom of the barrel GM products”. They never took my advice, and stopped calling and asking for it, instead. But they continue to buy the GM crap-boxes, because they offer cheap financing, and will keep allowing them to rollover what was owed on the previous one when they buy a new one. Pretty soon, they will not be able to get any more credit, and or will default, and someone will be left holding the bag for a string of junk low-end non-functional late-model hoopties. Multiply that by millions, for all the people in the same position all over the country doing the very same thing….and it becomes apparent where the car industry is headed, and how the favored son will continue because it won’t be allowed to fail…while smarter companies go down.

        And if you think my niece’s M.O. is uncommon…just take a ride through any real “hood”- and what do you see? Low-end GM crap-boxes are the majority among the “minorities”. 85% of ’em will get repoed and resold for next to nothing….but GM doesn’t have to worry, because they don’t have to eat the deficit like their competitors would…they just get to prosper, like the banks did when the Slick One made ’em lend mortgage money to those same people who are buying the GM crap-boxes…..

        This is a perfect example of how Uncle screws-up the [formerly]free market.

  5. Throw anything and everything up against the wall and see what sticks. All these manufacturers are salivating over the monthly fee that Apple gets from their iPhone customers (especially the ones who use the iPhone upgrade program -renting an iPhone for $50/month), the monthly fee that the ISPs and cell phone companies get from there customers, and the monthly fees that utilities get from their customers. And let’s not forget about Exxon/Mobil, still a better stock to own over a car manufacturer, who sell a consumable product everyone uses daily. Or the ultimate “monthly fee,” taxes? This is a bigger trend than just the automobile industry though. In my work world more and more of the hardware I deal with won’t do anything until the software license is applied. That license comes as part of a service contract that includes software updates and 4 hour turn around on parts replacement. It costs our company millions per year, so much so that we are major investors in our suppliers in hopes of recouping some of that cost through dividends and stock valuation. Which might be the answer. If you can acquire enough stock in Volvo maybe it will take away some of the sting of the monthly rental fee. But then again, can you afford to tie up thousands of dollars to save hundreds?

    As I type this, my 3D printer is printing out a bracket for my drone. The plastic it is using cost $23/Kg on Amazon, and it’s the most expensive (but highest rated). The 3D printer, which is a low or mid-range model, cost $299 at Microcenter. I probably could have found it cheaper online. Tinkercad, the software/website I used to design the bracket is free. Other than my time and the minuscule amount of electricity used the bracket will end up costing me about $0.17 assuming it will weigh around 8g. And it is being printed in my house, not in a factory in China. No shipping cost aside from the bulk plastic filament material. The 2 hours it will take to print feels like an eternity, but then again, it is a fraction of the time necessary to get it shipped from a factory, assuming this bracket had enough interest to have a minimum production run, which might be 10,000 units (but I only need one).

    For now that 3D printer is handy for very small plastic parts. But it is scaling up. You might have seen Jay Leno’s 3D printer that he uses to make replacement parts for his antiques. Jay has enough money to play with the bleeding edge tech. But very soon now that will become mainstream (it already is in the aerospace world). It won’t be long before some enterprising creative types start building custom cars. They’ll use crate engines and drivetrain parts from existing vehicles, but the coachwork will be done on 3D printers, small crews and on a very limited scale. They’ll be very expensive for a time, but like everything else there will be a crossover point where it will begin to make sense for everyone not just the rich. And while all that is happening the factory produced models will either get much cheaper thanks to their ability to scale, or they’ll just become more and more generic, less desirable and more of a commodity than they already are. Perfect for the rental model.

    Oh BTW, these 3D printed cars won’t be in the United States. It will happen in Africa, Asia and Eastern Europe. Small coach builders won’t be able to supply Uncle with the dozens of cars required for crash testing. The best we’ll get is some after-market strapons that might make our generic car look a little less generic.

    • Additive processes have considerable limitations. I have used them for over twenty years now. They will not replace traditional manufacturing methods any time in the near future and possibly never. You’re paying over $10 a pound for a material that is inferior to plastics that when injection molded don’t even cost a $1 per pound. Even expensive specialty resins which are stronger than anything additive processes can do are ~$5/lb. Injection molding is also fast. The price of the tool is paid back quickly at volume.

      What people like Jay Leno are doing is using an additive process to make a wax for investment casting or a part to create what is called a rubber mold. A rubber mold is made by curing essentially RTV around the part and then using the resulting mold to make a durable urethane part. The actual parts that are put into the cars are made by traditional methods, the FDM, SLS, or other process simply speeds it up and deletes expensive steps that don’t make sense for low volume and one off pieces. Now some of the processes can make a decent final part for a restoration but it takes an enormous amount of finish work to get there. It’s better than not having the part at all but it is expensive and the real art is in the craftsmanship. Again the additive technology just gets there faster by giving the craftsman a base to work from.

      I could go on, but the idea of these things taking over the world are unlikely. They are handy, great for development, etc but they aren’t going to put traditional manufacturing out of business nor craftsman.

      • For a one-time thing, it’s often far cheaper [and of overall much better quality] just to have something made at a machine shop. ‘Specially if you have a local shop that exists mainly to service equipment at local factories, and which does small jobs on the side for the community, cheaply.

        I do this when I need a non-generic part ofr one of my 26 year-old farm tractors. It usually ends up costing me a thrid of what it would cost to buy the part from even an online Case-IH dealer.

        I had a shaft repaired on a mower gearbox. They don’t sell parts for the gearbox- only the whole gearbox…and it costs $1100!!!! I had the machine shop fix the sahft for $50.

      • OK, then what about small CNC mills? And what about small induction furnaces to cast those parts you mentioned? Maybe I don’t have one in my house, but if the stuff is cheap enough there could be someone in town who can do that stuff and manage a profitable business.

        I’ve seen CNC mills making custom wheels. It might not be something for the home-gamer to afford, but these things will be available in towns.

        • It’s amazing the deals one can get on used machinery- especially if it’s not the latest thing and somewhat “obsolete” among the pros.

          The machine shop where I go- the owner, who is a heck of a nice guy- usually works on my piddling little things personally- even when it might be a $10 job. (I often give him more than he asks for for payment!)- I was looking at his huge metal lathe one day, and figuring that new, that puppy must cost between $70K-$80K- and even used, it must go for tens of thousands…. Looking at all of the other machinery in the big machine/fabricating shop, I figured he must have several million dollars worth of machinery.

          I said to him “You must have SOME investment in machinery” (Wondering how a shop on the outskirts of a small town in a very rural area could justify such), and he started telling me how he buys all of his machinery used. Turns out, he paid $3K for that big $70K metal lathe!

          Could you imagine having your own CNC?!

        • There’s nothing new about small homemade furnaces for melting aluminum and tabletop lathes and mills (even CNC versions) have existed for decades. Even for working steel people create their own homemade forges if they have space for it. Been done for a long long time.

          That’s why I say the backstop for technological fall is around 1910. That’s where a well equipped home shop will have you. That’s where an Amish shop using traditional tools can get to. Approach it from what people can make with relatively modern tools or what people make from more primitive tools, that’s about where the stop is. If a collapse doesn’t stop there it’s free fall back to hunter-gather, living in caves, that sort of thing.

          • It’s funny, Brent- but now that you mention it, 1910 sounds about right- and even though I’d never thought of it that way, I’ve long said that if I could have picked any time period in which to live, c. 1880-1920 would have been it.

            • Hi Nunz,

              Working on the kid’s Beetle has reminded me how much effing fun those cars were . . . are! I can have the whole damn engine out in about 15 minutes and carry it to my work bench. Tear it down in about an hour; put it back together in an afternoon.

              For almost nothing in parts.

              Hot damn.

              I am jealous…

              • AHhh! Eric! Ain’t that the way it’s SUPPOSED to be?

                Ya know what too? Just doing things like that on that ol’ Hitlermobike, will give that kid such confidence, that he become a veritable MONSTER…the good kind! He’ll be ready to tear into anything!

                That’s what most of the kids today are missing! Not only experiences like that to build confidence; but the ideal of taking positive action to deal with the things in your life, instead of just passively standing by and letting some “trained, qualified, licensed expert” do it.

                It even works with adults, too! I showed my neighbor (He didn’t know a lot about cars) how to fix the head gasket in his car….(More like: Just told him what to do and let him do it) and that gave him so much confidence, that he opened a shop! (And it wasn’t that long ago that I was showing him how to do disc brakes!).

  6. Eric,

    As a libertarian why do you have a problem with any legal service sold by companies at any price? The libertarians I know have no problem with prostitutes selling themselves in the free market yet you are bent out of shape about renting a new Volvo for $20 per day, mileage, insurance and maintenance included????

    • Hi Sonic,

      The industry is moving toward a new way of doing business that will entail renting you “transportation” at top dollar, with the object being perpetual payments. I did not state that this should be illegal; merely that it is another example of the industry going batshit and people – if they buy in – along with it.

      If you think paying $600-$700 per month to drive an entry-level compact Volvo is a good deal – mileage, insurance and maintenance included – feel free to sign up. I won’t stop you!

      • As a capitalist, I just can’t get angry about any legal product or service sold at any price. The market will decide if Volvo’s rental plan survives. People and corporations make money only on products and services consumers actually buy.

        Nobody knows if this scheme will be successful and there is absolutely no correlation between its success and the elimination of of the conventional ownership model. Haven’t manufacturers tried this before with no success?

        The industry is moving to renting transportation? I don’t see it. Where’s GM’s rent-a = Cruze for $450 a month or Nissan’s Rent a Versa for $399?

        The simple fact that this plan requires A Credit and a clean driving record for that built-in insurance means most consumers will not qualify for this rental program.

        At best, these rental programs will generate a few marginal dollars for manufactures. People who expect a fundamental change in the car ownership model are the same idiots who bet on light rail in Los Angeles and Uber in Buford, Wyoming.

        • It’s not quite that simple, Sonic ‘Stang.

          Real Capitalism can only exist in a free market. That free market does not exist here- especially as pertains to cars. Governmkent regulation has eliminated the possibility of any real competition- so these auto manufacturers can do things which would be financial suicide if the possibility of new competition existed.

          These companies, being propped-up with government bail-outs; loans; subsidies; tax credits; etc. have little to do with free-market capitalism.

          And you can be sure, that once this gets going, the insurance and credit qualifications will be relaxed- just as they were for purchasing new and used cars the old way.

          I was just thinking that this may well be the impetus to initiate an insure-the-driver-rather-than-the-car type scenario, as they do in some other countries (And that would actually be a good thing)- or the car comapnies will just charge a higher price for people who are bad insurance/credit risk, or limit them to certain types of vehicles. (Just as it essentially is with purchasing cars…the average person can not just walk in a purchase a new Lambo….nor could he likely afford the insurance- but many could purchase and insure a Neon…or whatever the current POS econobox is….)

        • Hi Sonic,

          The problem – as others have rightly pointed out – is that we do not have a free market. Large corporations leverage the government to create “markets” and effectively force people to buy things. Mandatory insurance is one obvious example. So also air bags.

          The mandates are not going away. But how to keep people paying? By renting them that which they cannot afford to buy.

          The older/affordable stuff will be attrited out of existence, if not directly outlawed.

          The major automakers are investing hugely in an automated/rent-a-car future. They are dead serious about it.

          • Eric,

            By definition, you cannot control a market by renting consumers anything when they can’t afford buy when renting costs more per month than buying. The key phrase is “can’t afford.” Can’t afford equals NO sales.

            • The reason people are able to “afford” $600 car rental payments, $1,000 cellphones, and $300,000 college degrees in Gender Studies is the Federal Reserve Bank. Affordability, debt slavery is not.

              Remove the rent seekers in cahoot with government goons, allow truly productive work to flourish, and return to sound money.

              • james,

                People have limited incomes. The Federal Reserve System does not make an iPone X purchase for a single mother of two working at McDonald’s possible. She CHOSES to by a new iPhone and then she’s forced into spending less on other stuff.

                It seems you solution can only be accomplished by the government making choices for people. Quite the opposite of libertarian thinking. Maybe you prefer the government legislate how Apple can advertise iPhones because, hell, nobody really needs an iPhone and every dollar spent on iPhones could be more constructively spent.

                • Sonic,

                  People have limited incomes, yes. But the system not only enables but encourages people to live way beyond their means. And when they default, what happens? Others eat the losses and the defaulters are able to resume debt spending within a short period of time.

                  This encourages more of the same. Why not, after all?

                  I know some people locally. They have virtually no income. And yet, they have a new truck. Which replaces the new truck they had, which got repo’d. This is the third truck. Despite poverty level income and probably awful credit and multiple repo’s, they are able to continue to get loans on new vehicles.

                  This is how it works today.

                  There is less and less incentive to save and be responsible.

                  This program represents more of the same.

                  Anyone who signs up to rent an entry-level Volvo for $600/month for 24 months is an economic imbecile. But that is what’s wanted.

                  Look: I could go down to the Porsche store tomorrow and “buy” – that is, get a loan for – a new 911. I have “good credit.” But I can’t really afford the car. This is how the system works. The dealer doesn’t care; they just want to move the car off the lot and once financed, it’s not their problem any longer.

                  The entire industry is now based on this model. As in real estate a few years back, they will write a loan to almost anyone. Credit checks are increasingly meaningless, too. They want to play musical chairs; get the car/loan shoved off to someone else’s lap.

                  If the current debt financing regime went away, two-thirds of the people buying new cars couldn’t – or would not be able to afford a car more expensive than a $22,000 base trim Camry.

                  • Eric, in addition to the very accurate points that you make, we also have the welfare-entitlement system further skewing the free-market from the consumer side….

                    I have relatives who are on food stamps, and though middle-aged, continue to do nothing more than work at fast-food jobs- just so they can do the bare minimum to qualify, but not enough to preclude “benefits”….who drive a new car- and like the example you mentioned, it is just another in a long series of others- some of which they destroyed in short order from lack of maintenance/abuse/letting their irresponsible felonious teenage son drive ’em (after he wrecks his own)/repos, etc.

                    Every town and city now is full of single mothers with a gaggle of kids from various absent men, who live in subsidized apartments; get free Obamaphones.childcare/healthcare/edumacation/welfare/food stamps/heating assistance/ etc.

                    These things are all skewing the market so much- I mean, I’m 55 years old and have never owned a new car, and would consider it foolhardy to buy one- even though I could buy a modest one for cash….but we have people on food stamps buying new cars…and brand new cars and $50K trucks sitting all day in the parking lots of factories where their owner earns $8/hr.

                    People like Sonic just don’t “get” the present reality- that it is precisely because the world is inundated with foolish people who can not afford things that there is a market for $70K luxury pick-up trucks and $600-a-month car subscription services- because responsible people who make wise economic decisions do not buy such things…but artificial forces have made it possible for the foolish to buy them….for a time- but then, just like with the real estate bubble…that bubble bursts, because it is unsustainable…and companies go bankrupt; and there are left fewer players in the market place….

                  • Eric, Nunzio, I have determined that the entire society has been undermined by the distortions of a flood of credit and welfare. I further postulate that it was done deliberately to undermine productive men. To render them obsolete, to remove from them their desirability and respect in society.

                    Every time I go further than this I become ranty and personal. So I’ll just say personally I feel much like Romney Wordsworth.

                    • Hi Brent,

                      I agree with you; lots of commentary along these lines on Red Pill blogs. The planned obsolescence of men, as traditionally defined. I have several friends with teenage or near-teen boys and these kids are … displaced, is the best word I can come up with. They are bored, depressed – lacking the usual outlets that give guys purpose in life. One of these kids is the one I have kind of taken as my apprentice, the kid I am teaching how to wrench. I feel like Oskar Schindler sometimes…

                    • Yep. Welfare and credit. It’s pretty obvious for any who are detached enough from the drivel to still be able to perceive the basics.

                      Destroy men; women and children become dependent upon the state. Soon, men are turned itno women/childlike creatures, and become just as dependent upon the state; and are no longer a threat to the state.

                      It started 100 years ago, by giving women the vote. A perfect example of how “democracy” can be used to so easily manipulate and control- while it’s victims think that they are in control.

                      Watching a woodworking video on Youtube last night…the guy made an very apt comment, about how the standards of beauty are being manipulated (At first refering to design aspects- proportions and scale, etc.)- and then he went on to mention how the traditional standards of beauty pertaining to women are now being manipulated…so that boyish-looking women (with short hair; husky bodies; hard features, etc.) are now being promoted as the standard of beauty- and how that is naturally having the effect of blurring lines between the sexes- and that really, if you accept a boyish-looking woman as beautiful and desirable, how much of a stretch is it to start viewing MEN the same way, since they look so similar?!

                      Brent, Personal and ranty can be good! (If it were bad, I’d be evil!)

                    • Brent, gotta agree with you. I read a good article a couple days ago, about how giving women power via courts as opposed to natural power, of which they have plenty. They have feminized entire portions of govt., esp. schools.

                      I can recall how many more men there were in education in my day and they were instrumental in keeping boys male and girls, female. Women teachers often(according to their age with the older ones who taught my parents being of the old school)treated everyone like girls and punished boys for being boys. Of course it only got worse.

                      I worked with a guy as little as 2 years ago and he was 23 who told me of being a boy and having lots of energy and because of his size, they picked him out to be drugged to “settle him down”. He was given Ritalin and it visibly settle him but he was doing 90 to nothing inside. One of the many side effects of this drug on young men physically turns them into women. He was 10 years old at the supper table when he begin to soak his shirt by lactating.

                      He was really upset(who wouldn’t be?)and cried and screamed he wouldn’t take that drug any longer. He didn’t, quit lactating and became a young man. But he is really soft-hearted and lets people take advantage of him. Now he’s working at the sheriff’s dept. I hate to see how this is going to end.

                    • Yeah, 8! Now, if you do see any men in schools, they’re most likely queers.

                      Sheesh, that guy working for the Sheriff’s dept. He’ll probably over-compensate now for his femininity, and take it out on the public.

                      Too bad they wouldn’t give the Ritalin to more girls…they could use some feminizing these days.

                      This is beginning to sound like something straight out of Nazi Germany or Soviet Russia- imagine the history books…. “Adolescent boys were given drugs to make them more like girls- in bechavior and physically; while popular culture and feminism encouraged young girls to become demanding, surly and hard…”….

        • The automakers are following (knowingly or not) a larger program of what George Carlin called our owners while at the same time people are being conditioned towards a company town perpetual payment own nothing system.

          What is going to happen when people rent everything? How are they going to quit their jobs? They can’t. They have to make payments every month just to live. That’s the goal. That’s what obamacare does. It was designed to cut off the possibility of leaving that corporate job and getting a catastrophic only insurance plan. That’s why it banned them. That’s why it created only higher prices yet. The goal is to reinstitute the human norm. The norm which is basically a nobility that owns everyone else.

    • For whatever it’s worth, a substantial portion of libertarian economic policy (might as well call it Austrian, but I digress) is predicated on the idea of market efficiency. Market efficiency, itself, depends on a number of things, the most important of which, is that the market incorporates whatever information is available into pricing and purchasing decisions. The most reasonable market efficiency is usually weak or maybe, maybe semi-strong. In either of those cases, information from market participants or observers is useful because that information will/should eventually be incorporated in the price of the good at issue. So, basically, Eric’s commentary is an expected, if not necessary, component of pricing, and there’s nothing unlibertarian about bitching about stupid market moves.

      Additionally, you usually have a regulatory system that allows market participants to exploit some aspect of the market. Here, it’s not present, yet. But the likely effect of a move by most auto manufactures to this model would, for reasons too complicated and long to get into here, would be to distort purchasing and insurance decisions to their own profit by influencing the regulatory scheme to artificially create strong incentives for the public to participate as buyers in a dumb idea like this one.

      • It’s been a long time since I’ve read two paragraphs of complete nonsense. Austrian market efficiencies? Purchasing and insurance distortions?

        You actually believe automobile manufacturers will be able to extort more profits from consumers by regulating the automobile ownership model out of existence? Jesus Christ, there’s only ONE fucking problem with your forecast: How do consumers magically find the disposable income to spend 30, 40 or 50% per month on transportation than they do now?

        Speaking of Austrian market efficiency, I recall they efficiently joined Nazi Germany in the ’30s.

        • Sonic:

          I hope you’ll forgive me; I assumed most readers had a higher level of familiarity with economics than seems was warranted. With an actual degree in economics, along with a doctorate and going on twenty years of litigating in the arena of securities fraud and issues related to market efficiency in the US stock markets, I sometimes make that mistake. Next time I’ll use more basic concepts and not assume you’re anything beyond borderline illiterate and unschooled. But that said, I’m sure your opinion is just as valid as my knowledge.

          In the interim, I’d suggest you Google “Austrian School,” “types of market efficiency,” and “regulatory capture” if you’d like to better understand what I’m saying. And, yes, I do believe that it will be very easy for market sellers to create a legal environment that generates market outcomes to their profit at the expense of buyers. It’s almost a certainly, quite honestly, and the examples are myriad – look at FDA and the pharmaceutical regulatory environment.

          And, finally, yes, I think Menger wildly failed by assuming that rationality on the part of individual actors eclipses an absence of informational parity among market participants. But that has nothing to do with Austria in 1938, I’ll happily note.

      • Fascist economic thinking is based on societal level effeciencies. That’s what we have today. Libertarian economic thinking is based on individual level effeciencies.

        The rental economy is about societal level efficiency. For instance, eliminating a motor vehicle’s idle time. Someone is always using it.

        On the individual level the cost of renting something can be more efficient for some but for most it is not because as eric points out, renting is payments forever but once you buy something it’s yours.

  7. So something upper income people will think is fabulous for everybody, oh goody…………. Never mind its too expensive for over half the population and a crappy deal for almost everybody.

    So much wealth just disappearing before our eyes because people just don’t understand simple economics.

    • Hi Rich,

      The thing I worry about the most – and which I suspect is The Plan – is that, eventually, this is how they will sell cars, period And there won’t be an alternative.

      The industry is desperate to scrape more money from the bottom of the barrel and they see perpetual rentals and the “sharing” of automated cars as the best and perhaps only way for them to stay in business. The mandates – and debt-driven idiocy – are making it increasingly difficult to put together a loan-to-own traditional finance package because you can’t realistically push that out much beyond seven or eight years due to depreciation. But the cars are becoming unaffordable. So the solution is to rent them instead.

      • Playing devil’s advocate, what’s so wrong with renting a depreciating asset? Assuming a heathy vibrant rental marketplace it might lead to overall lower costs over time.

        I know that’s a big assumption to make, and of course cars will become as fun as riding coach on the redeye to Tampa. Because all US companies can do is compete on price.

        • Hi Ready,

          Nothing… if you’re not getting screwed on the deal! But $600/month for 24 months to rent an entry-luxury compact crossover?

          I need some of whatever they’re smoking!

          • Well, if everything was included, no milage or damage penalty (yea right), in some cases it might make sense. For sure people who can claim their vehicle expense or run a small business it might be a good deal. And if you’re of the mind of always wanting the newest vehicle it might work too. $14,500 out the door isn’t horrible and in line with what you’d be paying on a car payment and comprehensive insurance. But for those of us who look at a car payment like a prison sentence, it is a horrible thought.

            But I know quite a few people who will love the idea, especially when you factor in the “convenience” of a single (automagically deducted from your bank account) monthly payment for everything. And Volvo is looking over at the Certified Pre-Owned lot and thinking they can dump them off on dealers when the rental time is over for those of us who want to own.

            • Hi Ready,

              I’m still not seeing it… I included in the article as a counterpoint the current 3 year lease offered by BMW for the X1 (similar to the Volvo) for about $370 /month. About 40 percent less – and not taking into account three years vs. two years.

              The only meaningful thing Volvo pays for is insurance. And they are making you pay for it!

          • Almost $15K over the course of 2 years…just for the use of a vehicle, and you walk away at the end with ZERO. (Plus the inevitable taxes and other fees, of course).

            For someone like me, who drives c. 3K miles a year….that’s some pretty expensive mileage! It would be cheaper for me to hire a chauffeured limo every time I went out….

            On average, I’ll pay $4500 for a vehicle, and it’ll last me at least 10 years. And then if I want, I can almost always sell it and get back what I paid for it.

            Soon, there will be no viable $4500 used cars, ’cause these delicate software-dependent, computerized non-serviceable vee-hickles will be too expensive to maintain and repair once out of warranty- which I believe is part of the plan, and has already been implemented.

            • Ditto, Nunz!

              My “newest” vehicle is my ’02 Nissan Frontier, which I bought used about eight years ago for about $7,000. It is currently worth about $4,000.

              That math seems pretty good to me…

      • They might stamp out new car ownership but after just a few years these cars won’t make sense for the subscription service any longer and will be sold out into the wild.

          • Brent, the cars are only too expensive for private owners to service. The manufacturers have the parts, equipment, and labor- wholesale. And I’m sure, once the rental model takes over, and the public has been stripped of serviceable cars (or they’ve been outlawed), suddenly and miraculously, they’re return to making cars that are much more durable and simple….and lots of the regulation that prevents that from being the case now, will go away.

            There will be fewer models of cars [thus effecting a big cost savings]; little if any change in the models/styles over the years [Since you won’t have a choice, and will be paying just for a transportation appliance…..it won’t be like they have to tickle your fancy to make you buy…]

            Ever see the trucks that local businesses use in places like Taiwan? They’re all exactly the same; even the same color- blue. They haven’t changed in decades. The streets are full of ’em. You can’t tell one from another. Or, taxis in NY. There are a couple of different models of car they allow now for the “private owners” to use as taxis…the streets of NYC are clogged with yellow taxis that all look the same. This sort of thing will become the norm when the rental model gts fully implemented. Conveyances for human cattle. Just an appliance to get you from one place to another. One’ll be the same as the next. Maybe they’ll be a little economy one and big luxury one…..it won’t matter how old they are…they’ll never change.

            • This is what some say about the rental society, things will be durable again. But today’s durability complaints where they are valid have three primary reasons:
              1) stagnant and declining wages.
              2) Inflation.
              3) technological progress rendering the old obsolete quickly.

              All three are at least in part driven by monetary policy. Only number three has even a free market component, but without monetary policy adoption would slow considerably.

              • A big part of it, at least when it comes to consumer items, is technology for technology’s sake; making of even the simplest things “automatic”; “convenience” features, etc.

                E.g. the replacing of a simple cable with a system of switches, servos and/or sensors, all fed through a computer module;

                The replacing of a few simple switches with touchpads or touchscreens.

                They prey on the ignorance of the gullible. “It’s the latest technology! It must be good!”.

                The average tool buys an AWD car. Does he realize the complexity- both mechanically and electronically of the various Rube Goldberg contraptions packed so tightly into and under that car, just waiting to fail (And with plenty of opportunities to do so, since they are dependent upon so many different systems/inputs)?

                Does he realize that even if the AWD doesn’t break, that it will complicate (and make more expensive) the repair and maintenance of the whole car? ….that when if he damages a tire, he may have to replace the whole set of tires, rather than just the damaged one?

                And all for what? For a car of very limited extra functionality….

                Or how about the aluminum-bodied pick-ups? Aluminum…. to save a couple of hunnert pounds, so the truck’ll get 0.01 more MPG- and meanwhile, they throw in a powered tailgate; power-folding mirrors; electrically retractable steps….etc. which equals 200 pounds worth of extra crap, which is more to go wrong, and in a now weaker and more costly to repair body……

    • Something that’s too expensive for most consumers (never mind they couldn’t qualify for this program even if they wanted to) is somehow going to eliminate car ownership? Sure it is.

      By the way, there are millions of software dependent, computerized $4,500 vehicles on the market right now. In fact, most automobiles worth $4,500 that contain an ECU and an OBDII port.

      Jeez.

      • Mr. ‘Stang, Have you learned nothing from real estate? Or even from the traditional auto marketplace, where we currently have a HUGE problem because half the population is driving around in cars they really can’t afford, and repos are among the highest ever.

        The average American is living well beyond his means, and is in ridiculous debt….and schemes like these car subscriptions are only going to exacerbate things.

        And to compare old ODB II systems to today’s software-based systems is ridiculous. OBD II is simple engine and a few other systems monitoring and management through standardized, static, and long-established means. The newer cars have EVERYTHING controlled by an actual computer and software- and it is proprietary. 2 completely different animals. Essentially the difference between a calculator and a PC.

        Again, the newer system means no options. The purchaser is a captive customer; and is dependent upon the manufacturer for software support and many service and repair functions which only their proprietary equipment is capable of performing. Once they stop supporting your vehicle; or the cost of their service out-of-warranty is too high to justify the repair of your older car (and an independent shop can’t do it, because they don’t have access to the proprietary equipment; software patches; or even parts) you throw the car away.

        This is not capitalism; this is an artificially-manipulated market/monopoly, created by government regulation and centralized Keynesian economics, which has essentially created a monopoly- and it is going to get worse, as the remaining smaller car companies which dependent upon profits alone, are forced out, and only one or two favored crony-corps will remain- and they will not be the ones that the consumers chose; nor the ones who make the best products and offer the best values…but rather the ones the politicians who control this artificial market favor, such as GM. -as it is more so the regulation and central banking which determine who will prosper, rather than the consumer.

        If the consumers were calling the shots, Cadillac, nay, all of GM, would be gone already.

        • Nunzio,

          Actually I learned quite a bit from real estate. As a commercial real estate broker and multiple apartment building owner. And, I spent two years at a top ten US bank as a money market representative.

          I used to pick up economist Irwin Kellner at LAX and trot him out to client lunches at the Beverly Hills Hotel. I always reminded him that shooting darts at a dartboard in my office was more accurate than his market forecasts. My clients thought I was a genius and he got to do the weekend morning financial shows on CBS, NBC and ABC.

          • “Actually I learned quite a bit from real estate.”

            Aw, shit! Are you really just Bill posting under a new handle. everything anybody mentions, ol’ Bill has done, in spades. What an absolute know it all/done it all asshole you are.

            I’m so fuckin impressed over here. You have no idea, really, just how fuckin impressed I am with you, sonicmustard.

          • But, Mongoloid Sonic [Inside joke for Ed]….what did you learn from chauffeuring Irwin around, if you can not see the parallels between the present automotive market/debt and what led to the ’08 RE crash? (And will be leading to the soon-to-come RE crash)?

      • Hi Sonic,

        I’ve been covering the car business for a long time and I am certain, based on my knowledge and experience sussing out trends, that the object is, indeed, to eliminate traditional vehicle ownership; to get people into the “transportation as a service” system.

        Part of the reason is that the cost to buy and keep a new car is becoming increasingly prohibitive due to a combination of government-mandated equipment and gadget-obsession made feasible by credit/debt. But the result is that cars are too costly to finance for a large and growing number of people. So, to keep things going, the idea is to rent cars.

        Wait and see.

        • Eric,

          Unless manufacturers figure out how to make all inclusive renting cheaper than buying or leasing and figure out how to qualify the zillions of B through D Credit consumers, renting is a non starter.

          • Make renting cheaper than buying? No. They’re in the process of making buying more expensive than renting. You buy a new car with twin turbos and port injection over direct injection, and more emissions controls than engine; which has endless electronic, software, fitment and mechanical quirks from day one…and by the time you’ve owned it long enough or driven it far enough to end the warranty, the next repair or series of repairs will cost more than what the car is worth- so it then is a scrapper…..before it’s even paid off- and then you have to take on yet more debt to buy another one. At that point, and steady monthly payment isn’t looking so bad. It’s inevitable anyway, you figure, so why not?

            They start with Crapillacs and Volvblows. Before long, it’ll be Camry’s and Fiestas and Sonics…and Miss Factory Worker or Mr McDonald’s-Fries-Hander-Outter will say “Oh wow, I can get in on this now, just like [insert name of latest cretin actor or rap “singer”]! Oh, cool!”.

            And before long, nobody owns anything. Isn’t that one of the tenets of communism? Remember commie John Lennon’s song “Imagine”: “Imagine no possessions…”?

            There will be no used cars. Only those who can afford and who are willing to accept the subscription terms/who meet their conditions will be driving.

            You will have no say about what is in your car. No custom stereo. No opt out of black boxes/GPS/On-Star/remore disabling/ etc. You’ll be tracked everywhere you go. No customization; no driving over the speed limit, as you will be monitored, and the car company may void your contract/disable the car/inform the fuzz/charge an extra fee- or all of the above. The technology and infrastructure are already in place!

            Why do companies such as Uber and Lyft continue to exist, despite massive losses, year after year? To get people used to the idea of ride-sharing.

            NEVER before have we had “businesses” which lose hundreds of millions of dollars per year since inception, continue to expand and survive and gain popularity and public favor, and even have stock which trades at absurd prices, with no profit on the horizon! Ever wonder why?

        • You don’t have to convince me. Show me anybody that has been able to work on their own car that’s less than 10 years old.
          Instead of replaceable parts there are replaceable part groups. “Dry” bearings inside the entire hub with rotor and studs instead of greased bearings and seals on the front of a 4WD pickup? My neighbor’s new Chevy 3/4 T 4WD has already had the drivers side front hub assembly replaced at 44K. At this rate it will be replaced at least once again before he has 100K and gets another “new” one.

          How many hundreds of thousands of miles did my 93 and 82 have on the front end? Hell, I lost count. A 454, the “forever” engine and a TH 400 the “forever” transmission. I’ve seen a 6.5 Turbo Diesel Chevy with over 930,000 miles and still going strong. Seen anything made since ’98 that’s got that sort of mileage? No! Hell no! and you won’t. 910 Ft. Lbs. of torque on a Duramax and more on the Ford Powerstroke with “only” 900 for the Cummins. Sure, stressing a block and rotating internals with that sort of power and not being the size of a big rig engine is going to last ??????? Please…….There’s a reason REAL diesel truck engines weigh 2 tons and displace 15 liters. A C 10 Cat only makes around 1100 lb ft of torque so why not save money and replace them with a Duramax or Powerstroke? KMA auto makers. I’ll keep rebuilding old light trucks till I die…..and that may not be long but you’ll have to pry my torque wrench outta my cold dead hands.

          • EightSouthman,

            I bought a new 6.0 Powerstroke in 2005. Emmissions regulations made that engine a complete disaster and caused Ford to end its contract with Navistar.

        • Eric,

          I agree that government would like to control our movements. However, do not make the mistake of believing something that might work in New York (renting, Uber, etc.) will work in Los Angeles let alone in flyover America. Remember November 8, 2016?

          You will not see automated cars, automated roadways, care sharing, car rentals in lieu of ownership or any other Orwellian fantasy in Wyoming or most of middle America because the cost per capita makes it impossible when the capita is spread out over hundreds of thousands of square miles.

          Your forecast is about as likely as all of the nations on Earth ending war and poverty and spending 100 times their collective GDPs to built Star Trek style ships. Wait a minute, doesn’t Musk claim he will colonize Mars with 100,000 people flying them their on thousands of rockets each three times the size of a Saturn V?

          • Hi Sonic,

            You are basing all the foregoing on an erroneous premise. This is not about economics. It is about control. There is a concerted, systematic push to make internal combustion engines effectively impossible to produce; exorbitantly expensive technologies are already required to make them viable as regards regulatory compliance and soon – when carbon dioxide is decreed to be an “exhaust emission” and subject to EPA regulation – it will mean the de facto imposition of electric cars, which most people will not be able to afford.

            So, they will be offered the opportunity to rent.

            Whether they can afford this is immaterial.

            The goal is to get most people out of cars – as personally owned conveyances.

            It does not matter that this will impose severe economic costs, including the cratering of a major industry.

            You are looking at this from the wrong point of view.

            • Eric,

              As much as I agree with your sentiment, SOMEBODY has to pay for all this government overlording. We all pay more for each new car because of additional government mandates but higher prices reduce sales. Note the average age of cars on the road today.

              The market does not allow price increases without simultenous reductions in demand. IT IS ECONOMICS.

              California can mandate EV sales but that raises the price of all ICE vehicles because those EV buyers can’t afford the direct cost of electrics.

              It is impossible to legislate everything you’re worried about into existence simply because nobody can pay for it.

              Look at California. It’s broke from legislated mandates and giveaways. For years, productive citizens have been leaving and they’ve been replaced by non-productive illegal aliens. The population has been increasing but the increase is a further drain on the economy. It’s called negative immigration.

              • Sonic,

                Again – this is not about economics. It is about control. It is about diminishing the average person, limiting his means, his ability to do as he likes.

                The major car companies have become effectively part of the government rather than antagonistic toward it. The anticipate mandates now rather than fight them.

                And the CEOs don’t give a flip about profitability in the long term because they will have long been gone by then. Mary Barra is the new archetype

                Remember, I told you so!

                • Eric, if anyone doubts what you say, all they need do is look at some of the recent policies and practices of these corporations.

                  They pursue “diversity”- although doing so is often to their own detriment.

                  They are more concerned with including a disproportionate number of minorities; he-she’s, etc. in their adverting- although such minorities may only make up a tiny percent of the demographic who actually buy their product- and by doing so, they risk alienating a large number of existing customers [Like JC Penny using transvesters as “female” models- or Target multi-gendering their bathrooms. ]

                  Current executives are the products of modern liberal schools; and political and [a]moral ideals and agendas are overriding any desire to make a profit.

                  Investors have become just as bad, too- as companies with virtually no assets and which generate no dividends, have stocks which trade for insane prices; or companies which lose hundreds of millions of dollars per year have stock which is traded at higher prices than companies which actually earn profits.

                  It’s become a crazy bizarro world, in which it doesn’t even pay to look for logic and sense, because all sides seem to be crazy.

                  • Hi Nunz,

                    Spot on!

                    Wish I’d thought of that 🙂

                    The Diversity thing is an excellent case in point of corporations pursuing policies that will cost them money for the sake of a political agenda. They may be driven by ideology – or by fear. It doesn’t matter. The end result is the same. Sonic isn’t seeing it because he still views things through an economics-only prism. I used to do that, too. It’s a kind of naivete which I myself was once deluded by – so I am not faulting him for that. It takes awhile to see.

                    But once you do…

                    • For shame, Eric! 😉 Why didn’t you think of that?!

                      Oh…wait…you did; you wrote articles about it! : D

                      Re: Sonic:

                      Yes, while reading what you wrote about his viewing of the situation through a purely economic lens, I thought to myself: “Specialists in a given field tend to view everything in terms of how it relates to their specialty, often to the exclusion of all else” (Which is why “experts” are usually always wrong about things….) Which made me think that Sonic must be an economics specialist. And then I see in another post of his…that he is indeed of the economist bent….no surprise there!

                      It’s like the old saying: “When you’re a hammer, everything starts looking like a nail”.

                    • There are very few generalists (relatively) left in the world. It is likely intentional but it could be an accident of the division of labor. But I think it’s from creating economic and political fiefdoms.

                      In each field the established experts rule. Nothing from the outside is permitted and everything from inside that disagrees is stomped out. The result of course is failure.

                      I prefer to listen to what well learned people from outside fields have to say. Why? Their paycheck isn’t on the line. I also find many heretics within a field support their arguments better just as many outsiders do.

                      There’s so much argument from authority today it is insane. I’ve been told that I must be wrong about what climate scientists are doing with the data because I’m not a climate scientist. Well first off I learned not to do what they do when I was in the fifth grade and furthermore data handling is a big part of my field. It’s not different because it’s climate data. The same rules apply. It’s like everyone took some sort of zombie drug that says ‘only listen to experts’.

                      Technocracy in bloom I suppose.

                    • Well-said, Brent! Well-said!

                      I especially love it when people say that my observations and experiences, gleaned in the real world, over decades, are “anecdotal”, but yet some myopic guy with an agenda who does a study in which a handful of specimens represent all mankind or the whole world, is doing “science” when he makes some observation, although he never proves causation, but only reports on effects in his little study; and only speculates as to causation.

                      But this is what we are taught in 5th grade….that the guy in the white coat is a “scientist”, and only deals in provable, repeatable hard facts…..so we believe that that is the case, even though most of the time, it blatantly isn’t.

                      You could almost understand the mentality, if it were limited to complex things which the average person couldn’t understand. But people even do this with the simplest of things with which they have personal experience. Case in point:

                      My mother notices an injury on my hand the other day. She says “I’ll bet you didn’t even wash it!”. I said “Of course not. I let it bleed a little bit to flush out any gunk; then stopped the bleeding, and now less than 24 hours later, it’s practically healed already and you can’t even tell that I had a metal object embedded in my hand”.

                      Then I get the usual “You always do that! You should wash it, and put some alcohol or peroxide on it! You’re going to get an infection! Yada, yada…”

                      I had to remind my mother that this has been my standard practice for the last 30 years…and I’ve yet to get an infection…but when I was a kid and used to get a little scratch, and she’d do all the “they say to”s on me…half the time, it’d get infected…just as happens to her, and everyone else we know…because water isn’t sterile; and introducing water and soap or chemicals is just increasing the chances of contamination….whereas letting some blood flow ensures any crud will escape and that no new crud will be introduced.

                      But the point is: My way has worked perfectly for 30 years. I used to rebuild engines and cut my hands often when they were covered in grease and gunk. Never an infaction.

                      But a track record of something working fine for 30 years isn’t good enough! You instead must listen to what some expert says- especially if it is repeated by the guy on the TV or radio!

                      It’s like: Reality doesn’t matter anymore; just do what “they” say….and ignore all else. What they say is good. What they say is right. If you’re not doing what they say, you’re wrong, and will probably die. Tomorrow, what they say may change…then what they used to say is no longer relevant…and what they now say, is. It may have taken them 30 years to figure out what you knew all along, and ten yeatrs from now they may be on the same page as you are….in which case, they are brilliant geniuses- but when you advocated it…you were crazy!

                    • Nunizo,
                      There’s a good talk on youtube by the guy who debunked the eat only McDonalds thing. It goes through how the processes of modern science are just ways pushing bullshit.

                      Found it:
                      https://www.youtube.com/watch?v=y1RXvBveht0

                      “Science For Smart People” by the guy who did the movie fathead.

                      Has to cuts I just use water and sometimes soap if my hands were very dirty when I got cut.

          • Yeah, the rental thing wouldn’t work out here in the sticks. Call up a car and wait while they send one from the next decent-sized town 40 miles away? Wanna take yer cows to the auction? Whadduyah do, call and order up a dually and a cattle trailer?

            But don’t forget: They don’t want us living here! They want us herded into cramped cities and metro areas. The fambly farm is almost a thing of the past. Last time gas went over $4/gal they were already talking “mass exodus from the countryside”.

            Us rebels and freedom-lovers living self-sufficiently out here on the land isn’t a part of their agenda….. Maybe that’s one way they’re planning on doing it: Making it impossible for us to drive!

  8. Yes – experience the brand.

    What is going n car prices? I saw a Cadillac Escalade lease on TV for $899 a month with over 4 grand due at signing. This can’t go on. Things that can’t go on tend to end.

    Meanwhile, in the related auto finance realm, NY is going after 3 subprime car loan originators.

    I though Eric would appreciate the second finance company named for these “predatory” loan practices:

    “Three auto finance companies — Credit Acceptance Corp., Clover Commercial Corp, and Westlake Financial Services — are the first auto lenders targeted by the New York Department of Consumer Affairs as the city ups its enforcement of “predatory financing practices.” ”

    https://www.autofinancenews.net/new-york-ups-enforcement-with-settlement-against-3-auto-lenders/

    Keep in mind, I don’t think there is any such thing as a “predatory” loan practice. If you’re loaning to people who have proven to be deadbeats in the past. There is a good chance you’re not going to get your payment. Of course you are going to charge very high interest. Interest is a function of risk and you are loaning to very high risk borrowers.

    If deBlasio doesn’t like it, perhaps HE should loan these people with horrible credit a lot of money for a used car at a low interest rate.

    • Yeah, if they WEREN’T giving out the loans to hoodrats and deadbeats, they’d accuse them of “discrimination”. If they were to give them out to such people and charge people with good credit a higher rate so they can keep the rates low on the others, commie coal-burner DiBlasio would love that- but of course that’s not going to happen, because people with good credit don’t need patronize places that would penalize them. So these places are the only way for some to get credit….you’d think the commie-liberal scum would love that…but NOoooo!

      Just like when Slick Willy signed legislation forcing banks to dole out cheap credit to those who didn’t deserve it/couldn’t afford, because “discrimination”….which ended up seriously raising real estate prices for everyone, and then resulted in the crash of ’08….but do they blame Slick Willy? NOoooo! They blame the banks and “the rich”……

      These people should not even be classed as the same species as us……they’re idiotic troglodytes.

      • Shit Nun, slick Willy did what he was told by the rich and powerful. Not one damn bit different than any other prez since I’ve been alive and that covers the “undisputed winna of WWll”. He danced to the tune he was given, the very reason he was there but at least he had the guts to warn the rest of us…..even though it was too late.

        • So true, 8. Now we have The Orange One who is doing the exact same thing Hitlery would have done if she were back in the Pennsylvania Avenue brothel.

          No matter who is in….the welfare-warfare state just keeps progressing, and the same sack of nuts are always right behind the scenes.

  9. Thought I read somewhere that the Cadillac subscription is $1800/month. If that’s correct, I can’t imagine anyone would be insane enough to go for that but I could be wrong – about both that number and/or the level of Clovers insanity.

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