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A12 BUSINESS
Tuesday 16 May 2023
Americans are holding on to their

vehicles longer than ever

By TOM KRISHER
AP Auto Writer
ANN ARBOR, Mich. (AP) —
With new and used cars still
painfully expensive, Ryan
Holdsworth says he plans to
keep his 9-year-old Chevy
Cruze for at least four more
years. Limiting his car pay-
ments and his overall debt
is a bigger priority for him
than having a new vehicle.
A 35-year-old grocery store
worker from Grand Rap-
ids, Michigan, Holdsworth
would probably be in the
market for a vehicle within
a few years if not for the Mechanic Jon Guthrie inspects the underside of a 2014 Honda
high cost. For now, it’s out Ridgeline pickup truck at Japanese Auto Professional Service in
of the question. Ann Arbor, Michigan. Associated Press
“You’re not going to get
one for a price you can af- Since the pandemic struck owners are choosing to
ford,” he said. three years ago, the aver- stick with what they have,
Holdsworth has plenty of age new vehicle has rock- even if it means spending
company. Americans are eted 24% to nearly $48,000 more on repairs and main-
keeping their cars longer as of April, according to tenance. Auto mechanics
than ever. The average Edmunds.com. Typical have been struck by the
age of a passenger vehicle loan rates on new-car pur- rising ages and mileages of
on the road hit a record chases have ballooned to vehicles that now arrive at
12.5 years this year, ac- 7%, a consequence of the the shop in numbers they’d
cording to data gathered Federal Reserve’s aggres- never seen before.
by S&P Global Mobility. Se- sive streak of interest rate “You see cars all the time in
dans like Holdsworth’s are hikes to fight inflation. here with 250,000, 300,000
even older, on average It’s all pushed the nation- miles,” said Jay Nuber,
13.6 years. al average monthly auto owner of Japanese Auto
Blame it mainly on the pan- loan payment to $729 pro- Professional Service, a re-
demic, which in 2020 trig- hibitively high for many. Ex- pair garage near down-
gered a global shortage perts say a family earning town Ann Arbor, Michigan.
of automotive computer the median U.S. household “They haven’t been really
chips, the vital component income can no longer af- having major work or any-
that runs everything from ford the average new car thing. They’ve just been
radios to gas pedals to payment and still cover doing the (routine) ser-
transmissions. The shortage such necessities as hous- vice.” It doesn’t mean that
drastically slowed global ing, food and utilities. most owners of older ve-
assembly lines, making Used vehicle prices, on av- hicles are necessarily stuck
new vehicles scarce on erage, have surged even with constant repair bills.
dealer lots just when con- more since the pandem- One reason people can
sumers were increasingly ic hit up 40%, to nearly hold their vehicles for in-
eager to buy. $29,000. With an average creasingly long periods is
Prices reached record loan rate having reached that auto manufacturing
highs. And though they’ve 11%, the typical monthly has improved over time.
eased somewhat, the cost used-vehicle payment is Engines run longer. Bodies
of a vehicle still feels pun- now $563. don’t rust as quickly. Com-
ishingly expensive to many Faced with deciding be- ponents last longer.
Americans, especially tween making a jumbo Yet the cost of buying ei-
when coupled with now payment and keeping ther a new or used vehicle
much-higher loan rates. their existing vehicles, more is leaving more people with
essentially no choice but to
keep the one they have. q

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