Why American Cars Are So Expensive

Cars once promised independence and transportation for all Americans. Now, they are a luxury product that cost about $50,000, nearly 30% higher than just a few years ago. Affordable vehicles, especially those below the price of $20,000, have nearly disappeared. And while Automakers pulled in record profits in 2023, slim margins combined with deep investments into EV batteries, software and other technology is making it hard to produce cars much cheaper. Chinese automakers can, but they're impeded by tariffs and rules. Insiders say that is just a bandage - automakers need to compete.

Chapters:
00:56 Title card - Why American automakers can’t make cheap cars
1:05 Chapter 1 - Affordability
3:02 Chapter 2 - How cars got so expensive
6:07 Chapter 3 - Making a cheaper car
9:08 Chapter 4 - Competing with China

Producer: Robert Ferris
Editor: Evan Lee Miller
Animation: Jason Reginato, Christina Locopo
Additional Camera: Natalie Rice
Senior Managing Producer: Tala Hadavi
Additional footage: Cadillac, Chevrolet, Ford, Getty Images, GMC, Hyundai, Rivian Stellantis, Tesla, Toyota

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Why American Cars Are So Expensive

[jeff]

Title should say "why automakers WON'T make cheap cars"

[Jeffrey_Gauntt]

Mechanic of 24 years here ... They CHOOSE not to make a cheap car. PERIOD.

[Jakesmusings]

They make a lot of cheap cars; they just dont sell them inexpensively.

[klauszabel]

During the pandemic I needed to replace a Ford Explorer. Visited many Ford dealers who all wanted a premium to buy a Ford. I bought a Lexus because the dealership was honest and sold the vehicle for what they would have prior to the pandemic. I will never buy a Ford again.

[syxx]

I work with guys that buy 100k trucks just to drive back and forth to work. Then they put 12k worth of wheels and tires on them and complain about the gas prices

[Erik_The_Viking]

"Automakers WON'T make cheap cars because they addicted to selling overpriced crap cars and don't want foreign competition" - FTFY

[madpistol]

I remember a time when $30k got you into premium car territory. This is just sad.

[kamcg]

Another factor is US vehicles generally appeal to the US market only and are not designed to be ‘world vehicles’ so export opportunities are low because they are too big, poor fuel efficiency for roads and tastes of Europe and Asia consumers.
The current President complains Europeans won’t buy American vehicles and simply puts that down to tariffs rather than asking the better question of why are American vehicles unsuitable for these markets.

[gameguide]

Its not just competition that they're afraid of. They're against the right to repair.

[Ben-bglp]

Toyota should start selling cars directly to customers. I'll pay the same money, just spare me the humiliation of talking to a professional liar.

[emikomina]

the outdated dealership model is also to blame. Dealerships saw the prices they were selling at during the pandemic and wanted to continue those high prices

[andrewhu]

Still rolling with a 2003 Honda Accord and a 1997 Mercedes here.... both from the dealer with one year ownership/depreciation. No plans to change them up unless forced to do so.

[warrentrout]

Drive a big car and neglect your retirement. The American way

[nonog]

Protest with your wallet. Stop buying these cars! It's that simple. We as tax payers bailed these aswholes out back in 08 and now they squeezing us? Just stop

[hettfield]

Funny that they didn't mention that American automotive CEOs make TEN times more than European or Asian ones. When an executive makes 700 times more than the average worker, they might be the problem.

[jontalbot]

The world will be driving cheap Chinese EVs while the US is stuck with large, expensive gas guzzling monsters.

[steve]

Once again, in my opinion, the term “cheap” is being misused. U.S. automakers do make “cheap” cars but “inexpensive” they are not.

[leespitzer]

I'm an old guy, but I remember when all people wanted in a car was for it to run well and have a stereo and heat / air.

[ColonelPeppers]

Shareholders are the real reason why prices can't come down, short term profit and buy backs over long term solutions.

[chadwinthrop]

STOP PUTTING SO MANY COMPUTERS IN THEM I HATE THEM