This blog is a way for me to share hard learned lessons about money with those who are just starting out on their own. I hope it's a way for you to avoid making the mistakes I made, and to benefit from my experiences

Tuesday, March 27, 2007

Cars. Then and Now

I've had new car itch, and I've been looking up new cars like crazy on the web. I've noticed two things:

1. Cars are like cell phones. They keep adding on more features to keep the price up.
2. You basically get more car now then before for the same money, after inflation.

In November 1979, my dad and my 16 year old self went out car shopping for my first car. We both knew I needed something cheap and reliable. We settled on, and don't laugh, a brand new 1979 Ford Pinto. The sticker price was $5,800, but my dad being the former car salesman knew that this particular vehicle had been on the lot a long time as they were well into the 1980 year sales, so he bargained them down to $5,000. Thus I was the lucky recipient of a Ford Pinto with luxuries of automatic transmission, Power Steering, Power Brakes and AC. Well, recipient wasn't the word. I paid for almost all of it over the next 3 years. I drove that car to death selling it 10 years later with 138k on the odometer.

Anyway today using internet searches I looked for the most likely equivalent of a Ford Pinto and settled on a Ford Focus hatchback. I went on Edmunds and equipped it with at least what the Pinto had, including Automatic Transmission. Of course it comes with much more standard than the Pinto ever did. The Average selling price was $14,228.

Next, I went to the governments CPI calculator and asked what $5,000 is 1979 is equivalent to today. It came out to $14,015.

I think we can all agree that the Focus is a far superior vehicle. I've rented one and was satisfied with it. It also has more luxurious standard features. So the lesson here folks is we are getting much better equipped cars, better performing (trust me, the Focus performs far better than my gutless Pinto ever did), and safer (remember the infamous exploding Pinto gas tanks) cars than at least in the late 1970s, for roughly the same price.

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Anonymous Anonymous said...

Excellent analysis!

6/03/2007 5:53 AM


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