Classic and Old Cars at the Cusp of the Electric Generation: NMA Weekly E-Newsletter #666

Many of us still drive older cars in our daily lives out of necessity. The average on-road vehicle age is currently over 12 years, while the average cost of a new vehicle hovers near $40,000. The microchip shortage has even pushed the price of some used cars and trucks close to their original price right off the lot.

Classic cars are older, but they belong to a different class of owner: sometimes an investor and many times an enthusiast who wants to restore the automobile to its former glory. Usually, classic cars are driven on weekends and special occasions, not as a daily commuter.

In many ways, the fate of both—cars that are just plain old and classic cars—is intertwined.

With both automakers and the federal government pushing electric vehicles as the future, what will become of classic and older Internal-combustion-engine (ICE) powered vehicles? The legislatures of California and New York recently passed bills that ban the sale of ICE cars by 2035. Some California communities are not allowing new gas stations to be built.

Ford announced in April 2020 that it wanted the government to again sponsor a cash-for-clunkers program to help keep people shopping for cars during the pandemic, at least before the chip shortage disrupted the supply of new vehicles. The Car Allowance Rebate System (Cash-for-Clunkers) was enacted during the 2008-09 recession to stimulate new-car sales. Owners of road-worthy vehicles not older than 25 years and with EPA-rated fuel efficiencies of less than 18 miles per gallon cars were given the incentive to trade their ‘clunkers’ for cash. Some dubbed the program “I Hate the Poor Act of 2009.” This program not only junked many vehicles that were still quite operable, but also made car ownership a difficult proposition for some do-it-yourselfers and for-profit specialists. It was government-influenced gentrification of vehicle ownership.

Many classic car enthusiasts were dismayed by how many potentially rare, collectible vehicles were destroyed during the first cash-for-clunkers program. Online networks were full of posts bemoaning the great cars headed to the scrap heap. The program also created a shortage of good used vehicles in the US.

Used vehicles are an absolute necessity for many people who hope to escape poverty. Mass transit is nonexistent in many places, and without a trustworthy car, many low-income people cannot keep a job. Even affordable vehicles are challenging to maintain these days due to the expense for anyone working or lower middle class. Vehicle complexity and restrictive right-to-repair regulations make cost-effective, do-it-yourself car maintenance difficult even for the most mechanically inclined.

Ever-more-complex car technology, restrictive public policies, and a growing bias against ICE vehicles are all challenges owners of classic and weathered cars face.

Another factor is the lack of interest shown by younger generations to work on their own cars. The average age of the classic vehicle hobbyist is now 55. As fewer enthusiasts take up the mantle, support services for classic cars and older ICEs will become scarcer, further accelerating the electric generation of vehicles.

The Cash for Clunkers Program floodgates have now opened with a twist. California’s Bay Area recently announced that a revised program will offer $9,500 to trade a gasoline-engined car for an EV.

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