Why is this? Is there a Federal program to “encourage” lenders to give out loans for new cars in cases where they otherwise wouldn’t, or is it “just the way it’s always been, everyone who goes to business school learns that new car loans are supposed to be easier to get than used car loans, deal with it”.
To the OP, I think you need to understand the concept of the operating envelope.
Car reviews, comparisons and objective evaluations tend to rank almost exclusively on the boundary scenarios. They are obsessed with them even ones like Consumer Reports. The car that’s goes from 0-60 the fastest gets the highest marks, the car that has the greatest cargo space gets the highest marks, the car the gets the best highway mileage gets the highest marks. But, and it’s a big but, most people who drive a car will NEVER approach any of those boundaries.
The car with the slowest 0-60 time and the car with the fastest 0-60 time are identical to the person who never accelerates beyond 3000 RPM. The car with 15.9 cu/ft of cargo space is identical to the one with 12.3 cu/ft cargo space to the person who never road trips and never shops at Costco.
Cars, almost every make and model, are very, very good within the typical operating envelop of the typical driver. For the typical buyer who buys a car as an appliance, which is 90% of the market, consider all cars to be interchangeable from an operating standpoint. When that’s the case the subjective factors come into play heavily.
After shopping for cars with my parents and girlfriends who have never read a car review, I know full well how trivial the points of differentiation can be.
For my girlfriend, the most important factor in her recent car purchase was the apparent size of the dashboard. I can’t honestly articulate why this was a big deal to her, but invariably that was the first thing she commented on in every car we test drove. I’d point out the dated sound system, the cheap plasticy knobs and materials, the crappy seats etc, but if the cockpit seemed like it was going to overwhelm her it was a deal breaker. Because of this she preferred the wildly inferior and outdated Corolla to the Elantra, Focus and Cruze.
Eventually she settled on a used Volvo C30 for similar money which was her dream car, but if she’d have stuck with new I can promise that not a single attribute touted in any of the reviews/rankings would have made a difference. It would have been “cute”, it would have had a unobtrusive dash, few buttons and been available on the lot in a color she liked. She lives in the city and rarely drives on the highway, she wouldn’t give a damn about acceleration or braking. Gas mileage was important but anything within 4 or 5 mpg was the same to her. Reliability statistics and online discussions were so inconsistent and contradictory that she dismissed them out of hand.
My parents were a different issue. They’ve almost exclusively bought cars from the same dealer. They bought a used '78 Ford LTD from him in the 80s. They bought a series of Tauruses while they directed my aunt there who bought a Mustang and a Probe. My dad bought a used Dodge Dakota and a used Ford F-150 from the same place. I always assumed they got a good deal and had a friend there. When they last bought a new car from them, the first since I’ve been old enough and educated enough on the topic to have an opinion, it because a disappointing and eye opening experience for me. The Taurus had been briefly discontinued and my mom wasn’t interested in a Mustang or Explorer. The Fiesta and Escort (IIRC) were too small for my 6’7" father to fit in. The Ford 500 was new on the market but wasn’t a consideration for some reason, possibly price.
I begged and pleaded with them to go out and test drive some other models. To get competing price quotes from different Ford dealers. They wouldn’t do it. The Chrysler 300 was making waves as was the Nissan Maxima and Toyota Avalon. The Impala was on the market and I actually got them to sit in one because the Chevy dealer was literally 50 feet away across the street, but they never gave it a fair shake.
I came to learn that they didn’t have a regular sales guy, a guy my dad used to work with was working there part time to augment his retirement but he wasn’t really friends with him and didn’t really trust him. Their only reason for sticking with this dealer for going on 30 years? It’s close to home and it’s the where we’ve always bought cars. The Fords they’d had hadn’t been particularly reliable, the transmissions in nearly all of them had failed at some point, and the LTD caught fire while driving it. They weren’t getting especially good deals, usually paying just under MSRP and getting 0.9% financing due to excellent credit scores. It was just close to home and that’s the way they’d always done it. I think they were intimidated by the whole process and going to a new dealer was not worth the hassle. What did they end up buying? A beige fucking Crown Victoria! A 12 year old model with a bench seat and a gas guzzling V8, and they paid nearly retail for it.
So yeah, people buy cars for silly reasons. Marketing firms spend untold billions to understand what these reasons are and no one has successfully decoded it yet. It might be color for one person, dealer location for another. Misplaced brand loyalty or the thickness of a steering wheel. Sometimes its as simple as availability, people need a car and have 1 day to buy one, the Chrysler 200 is available in black, but the Chevy Cruze is only available in white so they buy the 200, reviews and rankings be damned. It’s not like they’d ever notice the suspension tuning difference anyways.
Automakers typically have their own financing arm, which they use to drive sales of their cars. The financing arm can take losses (and 0% financing is never profitable) as long as it drives profitable car sales. Somehow this makes better financial sense than just lowering the selling price, probably because people will happily spend more in the long run if they can get something they want now.
Used car financing, on the other hand, is typically offered by large banks or local lenders. They have to make a profit on the financing alone, so they won’t make riskier loans at such attractive rates.
One factor is that the auto dealer’s financing arm can actually repo a car and resell it. They are readily prepared to do so since that’s their business. Banks really don’t want to be in the business of flipping cars which were repo-ed. The loss for a car dealer who needs to repossess a car is much less because they are generally able to get close to retail back, banks are lucking if they get wholesale at auction.
Many people have brand loyalty. I personally love Ford and will never buy anything but a Ford. Why? Simply put, I do not know much about cars but I do know that I have had a total of five cars that I have driven well past 100,000 miles without any significant problems. When I sold my Mustang to my son early this year, I bought a Focus for its great mileage rating and cheap price. I did not look at any reviews because I trust the brand. I see no reason to switch from what has always worked for me. My parents are the same with American cars. My sister swears by Toyota and has stuck with that brand her entire life. I guess we’re just a family full of brand loyal consumers. If you don’t disappoint, you get a customer for life.
So she drives a Chevrolet too?
Journalists of any stripe need to first and foremost weave a compelling narrative that give the reader a sense of satisfaction at having achieved enlightenment. “Car A is literally a Diane Agron-Natalie Portman sex sandwich, Car B is worse than Hitler” is a fun story to tell friends and show off your manly knowledge of cars.
On the other hand, “Car A has some marginally softer material on the dash, but really they’re both fucking fine, seriously just buy the one with the biggest discount, who gives a shit” is boring and doesn’t sell magazines, even if it happens to be closer to the truth.
This is generally true for any consumer product. People who review shit and write magazines for a living need you to believe that buying one product over another makes you a clever boy.
OK, now this is making a little sense but I still have no idea why you are so upset. You seem to have the opinion that all cars (and other consumer products) are pretty much the same quality and the only reason anyone would try to find a difference is because they (me) are an asshole who wants to look down on people. If that is the case please call me an asshole and move on with your life.
As I have mentioned several times I have seen comparisons where the car in last place had some sort of statement like ‘It’s a decent car but the competition just edged it out’ Or ‘we rated this car last because of soft handling, if you like a softer ride you may prefer this car’- do they not want to sell magazines when they write those comparisons?
Does all the automotive press get together and decide what cars they are all going to rank last? Or are the all able to separately pick out the car that is .00001% worse and rank it last?
I do feel like I got a few ideas why people may go with a certain car without looking at any reviews and I’ll even add one of my own. If you do your own maintenance and repairs cars from the same manufacturer are often similar enough to make them much easier to work on for the backyard mechanic who is already familiar with that make.