Today, the picture is a lot different. The haze has cleared from consumers' eyes, wallets are opening, credit is easier to get and there are just a lot of good reasons to sell your clunker and buy a shiny new vehicle. There must be something to it. Sales of new cars and trucks last month were at their best since 2007.
Sales of hybrids and clean-diesel vehicles were up more than 35% in the first quarter. But you don't necessarily have to buy one of those vehicles to gain a lot of fuel economy and savings. The internal combustion engine has improved so much in the last ten years that even non hybrids will save you big money the longer you hold on to your new vehicle...if you choose well.
That ten-year old car or truck you are driving may have just 3 or 4 gears in the automatic transmission. Today, it is now common to see cars and trucks with 6 gears that boost fuel economy. And if you are driving an 8-cylinder or even 6-cylinder engine on your old car, you will realize a lot of fuel savings with today's peppy, fuel efficient 4-cylinder engines, many of which have turbo chargers or direct injection technology that will keep you from pining for the bigger more gas thirsty engines.
That 2000 Ford Explorer you have is probably not even getting the miserable 16 city/21 highway mpg it got when it was new off the dealer lot. A new Ford Explorer with the EcoBoost engine will get you 20 city/28 highway mpg. Keep your Explorer for ten years with the price of gas bouncing between $3.75 and $5.00 or higher per gallon and do the math. It's big money.
While new engines and transmissions help deliver better fuel economy, newer vehicles also tend to be more powerful.
In many cases, changes to engines that improve fuel economy also increase horsepower. During the past decade, engineers have:
• Reduced internal friction so that engine components can move more freely.
• Increased the computing power of engine powertrain control modules (the computers that control engines) to enable fuel-saving modes of operation such as cylinder deactivation. That means some vehicles that are V8 or V6 can operate 4 or 3 cylinders respectively at highway speeds where less acceleration power is needed.
An example of increasing horsepower is the Chevrolet Camaro. In 2001, a Camaro with a 3.8-liter V-6 produced 200-horsepower. Today, a 2012 Camaro with a 3.6-liter V-6 produces 312-horsepower (more than the 5.7-liter V-8 from 2001) and gets better fuel economy!
Power trends are similar for family sedans, minivans and even compacts and sub-compacts.
Significant changes in technology make vehicle occupants safer than ever before. For instance, on the 2001 Toyota Camry, front airbags were standard. Side airbags for the driver and front passenger were optional. An anti-lock brake system (ABS) was standard on highly contented V-6 models, but traction control was optional across the board. Electronic stability control was still an exotic, not-available-on-affordable-car feature.
Today, the all-new 2012 Toyota Camry offers standard airbags in from and back, as well as side airbags in front and back, driver's knee airbag. Stability and traction control systems are standard, as are tire pressure monitors. Knowing when your tires are losing air can not only keep you out of a nasty accident, they can save you money since low air pressure costs you miles per gallon.
In addition to the basics, technologies such as lane departure warning, automatic emergency braking, and various traffic warning systems are migrating down from luxury cars to the mass market.
To understand why you want some of these technologies and how they work, go to our Techsplanations Hub.
Not a single new 2001-model year vehicle sold in the US offered factory-installed iPod connectivity or the ability to play music off of a USB device. Are you trying to use your iPod or smart-phone while you drive? If so, you are likely braking the law.
Other technically advanced features you couldn't find in 2001 include power ventilated front seats (that cool or heat one's seat) Bluetooth wireless connections that enabled cell-phone integration into the vehicle's audio system, and even Satellite TV.
Options including head-up display, voice-controlled navigation systems and rear-view cameras - some available in 2001 and some not - are becoming more widely available today. Once you live with a back-up camera in your car, you will never want to go back.
Back in 2008, 2009 and even 2010, it was ridiculously hard for consumers with even solid credit to get favorable terms from banks and finance companies. Now that banks have burned off a lot of their bad loans, credit terms are easier today than a year or two ago for people with solid, and even decent, credit.
You still have to be a smart consumer, though, in negotiating finance terms. Never just take the rate a dealer may offer. Scout your local bank and credit union for their best rates on new-car financing. Know what the best rate is you can get outside the dealer before you go in to the showroom. Chances are that if he says he can finance you at 6.9% and you got a better rate at the local credit union, the dealer will match your best rate.
Your homework doesn't end there, though. You have to do some math to find out if you might be better off taking a cash rebate from the dealer and the interest rate from the credit union rather than just a low finance rate from the dealer.
But the good news is that financing for buyers with good credit is pretty much back to normal.