US consumers remain unimpressed with this progress, however, because they remember what they were paying for things pre-pandemic. Used car prices are 34% higher, food prices are 26% higher and rent prices are 22% higher than in January 2020, according to our calculations using PCE data.
While these are some of the more extreme examples of recent price increases, the average basket of goods and services that most Americans buy in any given month is 17% more expensive than four years ago.
There’s also the disconnect of what is being made by manufacturers versus what many people want. An overpriced and massive luxury SUV has never appealed to me, yet that is basically the primary vehicle being made. I could buy a new car if I wanted to, all 3 of mine are paid off but there isn’t a single new car being made that I want to drive more than my 2017 Ford Focus. If it was totaled tomorrow I would absolutely pay a premium to get it replaced rather than buy something new. When supply is low prices come up and used cars are a commodity that is desirable to many and not available from current manufacturers. 5000 lb EVs just do not appeal to me in any way.