Owning a Car Is So Last Century
It’s wild to think about how much everything has changed over the past century. From our beloved smartphones to Netflix, we’ll be the first ones to admit that technology and innovation have completely transformed our lives. Things are continuing to change as we shift towards flexility and convenience.
In the same way that we now can order food straight from our phones and can watch movies from the comfort of our own homes, the way we get from point A to point B has also taken a drastic departure from traditional car ownership and financing. Vehicle ownership and spending years locked into the same car are finally drawing to an end.
Let’s take a look back to learn how far we’ve evolved in the past 100 years or so.
Model T for the Masses
The Ford Model T changed the world when it hit the streets in 1908. Before its arrival, owning a car was a luxury reserved mainly for the wealthy. With a starting price under $900 at the time of its launch, the Model T made car ownership a reality for the masses. As Ford perfected their moving assembly line technology, production soared and the cost of buying a new Model T fell by roughly half. Over 15 million Model Ts rolled off the line between the years of 1908 and 1927.
While the Model T’s original prices seem remarkably low today, they represented a large chunk of change for working folks back in the day. Henry Ford was not keen on selling the Model T on credit. He offered a weekly layaway plan that required buyers to pay $5 to $10 weekly before delivery, but it was not well-accepted. Outside firms stepped in with offers to finance the purchase of a Model T with a “small payment down” and “balance by the month.”
General Motors Kickstarts the Automobile Loan Industry
General Motors got the conventional financing ball rolling when it launched the General Motors Acceptance Corporation (GMAC) in 1919. A 35 percent down payment was commonplace, with the remainder paid off in monthly payments over a year, which is a tiny fraction of today’s auto loans, which can extend to five or six years.
GMAC’s short-term loan reflected the realities of maintenance and repair. The cars of yesteryear were far less reliable than today’s vehicles. Once the year was up, repair bills consumed a significant amount of the family budget. In some ways, the one-year timespan foreshadowed today’s short-term leases.
Half-a-Car Changes the Game With Vehicle Leasing
Modern car leasing owes its roots to Eustace Wolfington’s revolutionary Half-a-Car company, which he founded in the early 1960s. With Half-a-Car, new car customers paid off half the cost of the car over a two-year term, then turned the car over to the dealer to resell it for half the original value. The idea was slow to catch on, but persistence paid off as Ford latched on to the concept in 1982. Eustace’s vision persists. The majority of today’s leases are in the 24–36-month range.
Selling Your Used Car Is Rarely an Enjoyable Experience
Folks tend to focus on new vehicle acquisition — the beginning of the cycle — rather than the end of the period, which is where the “gotchas” are often the most painful. Unloading a less-than-perfect used vehicle can be a grueling experience if you choose to sell it privately. Trading it in for your next vehicle yields disappointment when the dealer offers far less than you’d expect. People tend to forget the trade-in value to retail value differential.
Car Subscriptions Make It Easy
Flash forward to 2019 and the vehicle subscription model has shaken things up, with a marketplace that’s evolving rapidly. All-inclusive car subscriptions include insurance coverage, preventive maintenance, repairs, and roadside assistance into one easy-to-budget monthly payment. When you compare it to a conventionally-financed purchase or lease, the advantages are clear. You’ll save time and hassle with a subscription, with no heartbreak at the end of the term. If you’re considering the subscription route, you should explore all the options. We’re confident that Canvas offers the best subscriber value among its competitors.
Not Owning a Car Can Be a Beautiful Thing
Making a substantial long-term vehicle commitment is something that shouldn’t be taken lightly. If you’re fortunate enough to live near public transportation, owning or leasing a car becomes far less critical. Taking the occasional Uber, Lyft, or taxi is a reasonable expenditure with immediate benefits.
Our modern world is full of conveniences and fraught with expenses. While Grandma and Grandpop were lucky to have had a milkman and possibly a Charles Chips delivery, today we can have practically anything dropped off on our doorstep in a day or less. Whether it’s the weekly groceries through Instacart, dinner via DoorDash, or D-I-Y home improvement products from Home Depot with Roadie — convenience is king.
A vehicle subscription provides a middle-of-the-road option, with the flexibility to suit any requirements. You subscribe to the specific vehicle that meets your needs each month, without the hassles of ownership or leasing.
A Blast From the Past
We’ve come a long way from Ford’s iconic Model T to the cars, trucks, SUVs, and crossovers of today. The Model T resembles a tractor, by comparison. Modern vehicles provide luxuries, safety, and technology that our great-great-grandparents might never imagine. So much is taken for granted these days.
If you’re intrigued by automotive history, take your car from Canvas to the Greenfield Village or the Henry Ford Museum in Dearborn, Michigan, as they’re both a must-see. The rides at Greenfield Village are authentic and historic. They’re amusing, for sure, but this is no amusement park. Whether you’re tooling through the streets in a meticulously restored Model T or around the grounds in a train pulled by a steam-powered locomotive, there’s nothing quite like it anywhere else.