Why Do Foreign Cars Hold There Value

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The Big 3 aren't the only ones that suffer from their own legacy of 'problem children'. Anyone remember Jaguar's infamous electrical problems that nearly put the the brand 6-feet under? Or more recently, now about Mitsubishi's oil-burner 3.0 V6 that looked like a mosquito smogger driving down the road? Neither of those brands suffer those problems today but people still remember them for it...and promise never to patronize them because of it.

Like some foreign brands, GM made the bed they currently lie in with the [censored] they built in the 80s, and to a lesser extent, the 90's. I saw some pretty amazing stuff working at a Pontiac/Olds/GMC service department in the late 80's and early 90's. The Fiero's overall failure in quality and workmanship. The Quad4's tendency to burn lots of oil early in its life. The 3.1's hunger for intake gaskets. The 2.5's recall for noisy plastic timing gears. The 1989 GMC Sierra's massive recall for DANGEROUS failing ball joints. I could go on, but you get the picture. None of those issues exist at GM anymore, but the memories remain. Jaguar still fights their demons too, even though Ford completely turned that company around.

Through the same time period, Honda was faithfully building the multi-award-winning Accord, continuing to build on its indisputable reputation for quality and reliability. But even they suffered their own set of problems with the last-generation Accord's auto transmissions and I suspect lost some customers over it. My mom had an Accord from 1985 - 1993, and it still stands as the best car she's ever owned. It was my parents' first foreign car purchase and it NEVER darkened the door of a service department for anything but oil changes. They can't say that about their 72 Monte Carlo, 82 Silverado, 88 Silverado, 93 Thunderbird, 96 Crown Vic, 01 F-150, or their current Dodge Charger . They all had wierd problems, the Silverado being so bad that for the first time since I was born, my parents traded it long before it was paid off.

I went my rounds with the domestics too, and came out of it never wanting to own another one. I'm on my 17th vehicle since I turned 16 (that's 22 years) and the Japanese cars of that bunch have far outshined the domestics in reliability. My '97 Ranger is my last memory of owning a domestic car because it was just that horrible and I swore them off at that point. Surely you can understand why people would be gun-shy? Who has the time or patience to deal with repeated problems?

The Big 3 may well have ironed out the problems of the past and due to lack of experience, I can't testify to the quality of anything they're producing now. I can say that some of the cars they're putting out don't measure up in fit/finish, and material quality, and that has pushed me further away.

I think they'll get their act together once they figure out what's wrong with their current business model. They're producing some cars now that actually catch my eye. (Saturn Sky, Saturn Astra, GMC Acadia, Corvette)...but I'm gun-shy.
 
After 10 years of Mercedes with their expensive parts and an incident with a Volvo that caught fire while I was driving it, I'm finding my return to a domestic car very relaxing.

Foreign cars hold their value for many of the reasons mentioned here, plus the average American car buyer still wants to impress the neighbors. Buick's finest product? Meh. A BMW? "Wow, man!"
 
I don't think it's fair to imports or domestics to rate them on where they are from, like there is one big Japan, Inc car maker. every country has produced chrappy cars, and every country has produced great cars.
one thing I read when i was selling cars was a report that determined people's perception was 10 years behind reality. when oldmobile went down, people were still talking about the chrappy diesels they made, or their mom's '82 cutlass or whatnot. those bad experiences had nothing whatsoever to do w/ the (then)current state of olds, and that was that they were making great cars. the alero was a staple of used car lots because it was a reliable good car.
at the time of many people's bad experiences w/ domestics, there weren't as many choices from the imports, they just plain didn't make as many cars. the domestics make too many cars, plain and simple. the more you make, the more chances for more people to have a bad experience.
everyone I've known w/ a nissan has had a failed transmission. every day I see clapped out civics and accords blowing blue smoke. my worst 2 cars ever owned were imports- a VW golf and a mazda 626. my current mazda MPV is nickle and diming me to death, but it's a 12yr old vehicle w/ 142K, I'm ok w/ that. my '04 saturn VUE has 61K and is still tight and fun to drive, the last real TN saturn.
point is, don't fall for the line that domestics suck and imports rule. look at individual models, not a whole lineup.
chysler makes some dogs, but my parents had a 300M that was a great car. whatever opinion you are looking to justify, you will find it.
 
Originally Posted By: MillerMan
don't some of like 1998 thru 2000 toyota trucks have bad frames that rust away and are weak

Many more than that.

Body rust problems were mostly fixed for the 1989 model year, but trucks made up until 2001 or so (maybe later) are all prone to frame rust problems. Toyota is buying back some of the trucks, which is generous considering some are 10+ years old, but it would be better if it wasn't a problem to begin with.

I buy vehicles based on my personal experiences. Of the 15 or so Ford trucks I have had significant experience with (mine, family vehicles, friends vehicles), none of them have needed major repairs. My Rangers have never even thrown a CEL. That's why I keep buying them. Not blind brand loyalty or ethnocentrism.
 
Originally Posted By: OVERK1LL
Originally Posted By: qship1996
Drive a typical new American car over 100,000 miles and it feels old and used up, while the foreign ones still feel near new at that mileage.American cars have closed the gap on INTIAL short term quality, but have a long way to go in long term durability to compete with toyota/Nissan/Honda.



What do you define as typical?

To me what sounds "typical" is that type of stereotype....... and coming from import fanboys.

I've driven a lot of vehicles. I don't recall a domestic vehicle that would do THIS:

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I used to work at a repair shop that did fleet repair . I have repaired cracked frames on domestic pickups/commercial vehicles. You wouldn't see much of that kind of failure unless you are in the repair busisness. But I would have to add my 2006 Toy p/u is more of a G.M. product than my 1992 Toy p/u [way lower build quality but most people mistake quality with newer technology}
 
Most people don't buy that many cars in their lives, and certainly not that many new ones. It's a significant purchase for most folks. I can count on one hand how many brand new cars my parents ever bought. I remember one Pontiac that really burned them in the '60s, and they religiously bought Fords thereafter.

If one of those few big purchases happens to be a nightmare, the bad experience cuts a lot deeper and the memory lasts a lot longer, no matter how the brand improves thereafter. It's not like a bad pair of shoes or a TV set.

If Uncle Max got burned on his '78 GM diesel, I can understand why he might now drive a Toyota (or Lexus). Cars were expensive in '78, too.

A lot of the defections from the domestics was by their own making. Next time make a dash that is not designed to crack open after three years, or an engine that holds together, or paint that stays on the car. Or at least make it right when it happens. Don't take the customer for granted. These aren't just UAW issues.

Loyalty runs both ways, but the negative one is always harder to break. Why should Uncle Max now roll the dice on a Buick, when Toyota and Lexus has been good to him all these years?

Think one bad car experience doesn't make a difference? My father authorized fleet purchases. Guess who lost out on quite a few fleet sales.
 
Originally Posted By: Volvohead
Originally Posted By: aaxb970
Now all the automakers seem to be fairly equal when comparing same class of vehicle.


Not sure I agree with that. Comparing a mid-line BMW or Lexus against a comparable Caddy or Lincoln, I think I'd rather have the former.

Some market perceptions have some justification.



I'd much rather take the latter. So would most of America, going by the sales figures. Where's the market perception for that? According to speculators, American auto sales are dead. Yet, for some reason people still buy Lincoln? Perhaps the perception should be that people with a lower middle class income buy Asian, people with disposable income choose American. At least in Luxury sales anyway.
 
I worked fleet and the Ford pickups were the best by far of the big 3, Chrysler products by far were the worst. Japanese p/u seem to not wotk for some reason? Looking at the numbers though European mfgs the lowest quality as far as repairs go. My opinion it the quality of the big 3 is lower is because of the CEOs pay ! The CEOs really do not produce the car but the dollars that it would take to improve the quality are removed to pay the millions of dollars of pay and bonus and cost of The CEO. They are the most overpaid and lowest contributing members of the corporation in relation to their cost to the company.
 
... because their owners have self-esteem and vehicular-esteem, and don't feel a need to trade out every few years for 1) fashion/new body style or 2) mechanical necessity.

If they were to sell or trade, they'd go online to Kelly blue book and insist their car was in "excellent" shape even if it wasn't. If the car didn't sell, we wouldn't hear about it... but perhaps still see it on the side of the road with an outrageous price in the windshield. Other owners of the same make pat themselves on the back, seeing that price.

Now go for a "distressed" make, just like real estate in a town where the bubble burst, and people will feel really down and glum about it, in the mood to liquidate at any cost. Sharks and bottom feeders, oh, I'm sorry, value-conscious shoppers, pounce on these deals.

I buy well used cars, $75-900 is my price range. I fear my wife so I hideously lowball on cars she doesn't even know I'm looking at.
LOL.gif
The look on sellers' faces is indescribable but at least half the time they agree! You know at the water cooler the next day they'll say, my [censored] 97 ford contour is such junk, I only got $250 for it. In other words low resale value is a self-fulfilling prophecy.

What's funny/sad is reading a craigslist wanted ad with a list of Japanese makes a person wants to buy, for $500, because they're broke, have pity, blah blah blah... were I to attempt to re-educate them that something domestic would provide better basic transportation value, they'd close their ears and go la-la-la, preserving their ignorance, and ensuring continued economic distress.
 
You bring up a good point, eljefino. The people that a low resale value would affect would probably care less about resale value if they trade a car in every 2-3 years, being that they have enough income to buy a new car in that time frame.

The majority of Americans keep their cars at least seven years, I believe was the last report I read. I'm hearing ten years is the new average. Either way, do you think anyone cares what the resale value is that far down the road? I know I don't.
 
Originally Posted By: Gary Allan
I agree ..sorta. It's only lately (by that I mean "recent years") that you got a discounted "domestic/import". They didn't have a bunch sitting around to have a leftover sale at/during MY end. Meanwhile the domestics had to pump out xxx number of units and get rid of them. Margins were tighter on the domestic/imports ...and discounting wasn't too common. Production was scalable ..so could be kept much closer to demand.

Now they're maturing and suffering some of the "getting big" syndrome. Larger trains take longer to get up to speed and slow down.


Well said Gary. When was the last time anyone saw a Japanese dealership trying to get rid of last year's model with a big sale? Compare that with domestic dealerships where it happens every year like clock work.

To add to that, some domestic manufacturers have sold many of one particular model to rental agencies (Ford Taurus before the Ford 500 bait and switch comes to mind) which only depreciates their value.

Clark
 
Remember Americam cars are good cars made cheap and Japanese caes are cheap cars made good. Toyota has a recall for the frame rust.
 
Originally Posted By: OVERK1LL
I've driven a lot of vehicles. I don't recall a domestic vehicle that would do THIS:

I saw an Explorer that was [censored] near doing that over some speed bumps.
 
Originally Posted By: kingrob
Perhaps the perception should be that people with a lower middle class income buy Asian, people with disposable income choose American. At least in Luxury sales anyway.


I don't know where you live, but I live in a fairly affluent region. And folks with real disposable income do NOT buy new Cadillacs and Lincolns. They buy BMWs, some Audis, Mercedes and Lexues, and the occasional Jag. Occasionally, you'll see a very senior citizen in one, but that's IT. Retired blue collar folks in the town nearby buy Lincolns and Caddys, and they buy them used at great discount. That's not meant to be snobbish, but it's the way it is here and a lot of other places throughout the northeast.

Somebody's obviously buying the luxury domestics new, but it's not people around here. Maybe the retired plumbers up here get all your Lincolns once they go off-lease.

Actually, I do know one person who bought a new Caddy - my secretary. She used a mountain of GM points to buy a CTS. It's falling apart after 4 years and had to be towed twice last month.
 
Originally Posted By: ClarkB


Well said Gary. When was the last time anyone saw a Japanese dealership trying to get rid of last year's model with a big sale?


. . . or a BMW, Mercedes or Lexus dealer trying to peddle a fake convertible roof option? Or put them on dealer stock. I just hate when an L-M or Cadillac dealer does that. It just reinforces the downscale image of some of these cars in certain circles.
 
Originally Posted By: Volvohead
Originally Posted By: kingrob
Perhaps the perception should be that people with a lower middle class income buy Asian, people with disposable income choose American. At least in Luxury sales anyway.


I don't know where you live, but I live in a fairly affluent region. And folks with real disposable income do NOT buy new Cadillacs and Lincolns. They buy BMWs, some Audis, Mercedes and Lexues, and the occasional Jag. Occasionally, you'll see a very senior citizen in one, but that's IT. Retired blue collar folks in the town nearby buy Lincolns and Caddys, and they buy them used at great discount. That's not meant to be snobbish, but it's the way it is here and a lot of other places throughout the northeast.

Somebody's obviously buying the luxury domestics new, but it's not people around here. Maybe the retired plumbers up here get all your Lincolns once they go off-lease.

Actually, I do know one person who bought a new Caddy - my secretary. She used a mountain of GM points to buy a CTS. It's falling apart after 4 years and had to be towed twice last month.


I know here, at least, Audi and Lexus are not a sign of affluence. Mercedes and BMW? Yes. Infiniti and Acura? No. Lincoln and Cadillac? Yes.
 
With regard to cars and not trucks--In general, Hondas and Toyotas hold their value the best of the Japanese brands. They get lots of run in the press for being reliable. Subaru, Mazda, and Nissan depriciate a bit more quickly, but still less than US cars. Euro cars depreciate quickly the first couple of years then the rate of depreciation slows down. Euro cars tend to have owners that take care of them the best, so you see lots of them that are very well kept and that keeps the price up. Exception--VWs. They depreciate similar to second tier Japanses cars. US cars are seen by most as inferior quality--whether right or wrong, who knows--but they depreciate faster even though parts are less expensive than the Japanese and much less than the euros. Insurance is GENERALLY less on US cars. (I am in the insurance business 14 years). Parts prices and availability and difficulty of self maintenance are the main reasons I don't buy Euro anymore. When buying new--I buy Japanese. Used--I buy American.
Exception---I will never buy another Chev S-10 product. Possibly the worst vehicles made in the last 25 years----Component quality is astoundingly low.
 
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