Economics 101 Class - 30+ years of F150 Pricing

[Wtb13000]

This post was on Wolfstreet which is one of my favorite sites to visit. For anyone who says there are no good news sites, the guy breaks down complex economic news with a no BS approach. Highly recommend.

OVERVIEW: similar to the Big Mac index for measuring annual inflation Wolf compares annual msrp of the Camry to the F—150 and charts out the results. The crux of his findings: Ford (and others) have been gouging Americans for years now who are all the ready to pay crazy prices for their full size trucks, especially when compared to price increases for other types of cars. (Sound familiar Bronco afficianados? Are we all sheep?).

Year-over-Year, change of MSRP:
F-150 XLT: +10.9% (+$4,680)
Camry LE: +1.8% (+$475)
CPI New vehicles: +2.3%

From 2020, change of MSRP:
F-150 XLT: +39.4% (+$13,460)
Camry LE: +5.8% (+$1,450)
CPI New Vehicles: +21.7%

Since 1990, change of MSRP:
MSRP of F-150 XLT: +267%
MSRP of Camry LE: +77%

https://wolfstreet.com/2023/12/15/t...up-their-party-f150-xlt-camry-le-price-index/

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[Itchysquatch]

That’s insane! Let hope this post doesn’t get too political, because it is a very interesting topic that deserves an open minded discussion.

The F150 in particular is a fascinating subject. I’m wondering if the switch to aluminum, was one of the big cost drivers. Then the cost of mining different materials, recent labor strikes/increases, COVID induced supply chain Retraints etc, compounded with shipping increases due to fuel costs…when you look at it objectively it’s incredibly interesting. I’m just barely scratching the surface.
Obviously the cost to the American consumer is the part that’s alarming to say the least. I wonder how average car cost increase compares to the average American salaries/ income since 1990?

 

[North7]

Year-over-Year, change of MSRP:
F-150 XLT: +10.9% (+$4,680)
Camry LE: +1.8% (+$475)
CPI New vehicles: +2.3%

From 2020, change of MSRP:
F-150 XLT: +39.4% (+$13,460)
Camry LE: +5.8% (+$1,450)
CPI New Vehicles: +21.7%

Great thread and info, do you have data for the Chevrolet, GMC or Ram trucks? Likewise, what about the Toyota line, Tundra, Sequoia, Tacoma or 4Runner? They would be a better comparison than the Camry.

 

[North7]

That’s insane! Let hope this post doesn’t get too political, because it is a very interesting topic that deserves an open minded discussion.

The F150 in particular is a fascinating subject. I’m wondering if the switch to aluminum, was one of the big cost drivers. Then the cost of mining different materials, recent labor strikes/increases, COVID induced supply chain Retraints etc, compounded with shipping increases due to fuel costs…when you look at it objectively it’s incredibly interesting. I’m just barely scratching the surface.
Obviously the cost to the American consumer is the part that’s alarming to say the least. I wonder how average car cost increase compares to the average American salaries/ income since 1990?

Toyota shares all those issues as well, what they don't share is the CEO.

 

[Techun]

This just captures the time frame that trucks went from bare work vehicles to the luxury rocketships they are today

 

[MayhemMike]

The Big Three also have another cost factor that most ignore. They have massive retirement program costs. Decades ago when Ford built the Escort in North America I read an article that pointed out the auto maker applied $1250 from each escort sale towards retirement funding. They made zero profit on the Escort and simply sold the vehicle in hopes of creating a brand loyalty. The Big three have UAW contracts , while the overseas companies build vehicles in non union plants in areas of lower economic strains as well as tax concerns,. Their payroll and retirement costs are a lot less yet their vehicles cost just as much on average. My 2011 F150 crew cab 4x4 Lariat was ordered and cost $39K before taxes. While going through the Bronco reservation/ order process I looked at a few F150 s in the dealer stock. I almost passed out when I saw the stickers. They are absolutely fantastic vehicles but now when I drive my F150 I am deeply concerned about being involved in a collision that totals my truck. The cost of replacement is staggering.

 

[Hossamus Prime]

This just captures the time frame that trucks went from bare work vehicles to the luxury rocketships they are today

that and they are bigger as well.

 

[Newbie]

For anyone who says there are no good news sites, the guy breaks down complex economic news with a no BS approach

I am that “anyone” this news site is NO good…..

 

[Wtb13000]

I am that “anyone” this news site is NO good…..

Right on. Nice addition to the forum.

 

[Xjeepowner]

The most important factor driving cost is the fact that the F150 has been the number one selling vehicle for more than 25 years.
When your car or truck is that popular you can charge prices accordingly.
Congratulations Ford for building a truck that is so desirable.

 

[GroovyGeek]

It is well known that trucks are THE profit engine of the big three and Ford in particular. People keep wanting to buy them as family vehicles for reasons that completely escape me. There are at least a dozen truck owners in my neighborhood. Most of the truck beds have tonneau covers (ie never used as trucks) amd those that don't never haul anything. My guess is that most trucks are owned by guys who want to hang truck nutz in the back but are too ashamed to admit they don't have any where it counts. Union obligations are a real factor in the cost structure of the big three but don't explain the rate of growth of truck prices.

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