The context is about when cars reach the poor - your example of someone spending $60k is irrelevant.

A poorer person in NZ spends at most a few thousand on their car. The original retail price is nearly irrelevant by the time it gets to someone poorish (however maintenance/parts costs do matter for old cars).

The financial benefit of a discount mostly goes to the people that own the car while it depreciates as it trickles down.

Context: In New Zealand, the vast majority of people drive second hand cars (mostly imported second hand from Japan). A 20 year old car is regarded as newish in New Zealand. I am well off, so I have two second hand cars, my daily driver is 2006 I think, and I have a 1996 4WD for other stuff. New cars are only bought by the well off.

▲

otterley 8 months ago | parent [-]

I hear you. The numbers I provided were manufactured to illustrate the math and support my argument, not to be representative of a typical price.

▲

robocat 8 months ago | parent [-]

I thought about it some more but it is hard to explain.

I wonder if your mental model is that a $20k discount applies at all future prices - so that when the car is sold for $5k that it's "actual" worth is $25k.

My mental model is that when the car is sold at $5k it is worth $5k and the $20k discount has disappeared (the value captured by the early owners).

Background: I'm a top 5% earner but I have friends who are struggling financially.

My opinion is that the discounts is money paid for by our taxpayers into overseas pockets, that benefits a few well off people. Strangely enough the discounts were introduced by our more socialist party, and removed by the incoming less socialist party. I don't believe the discounts are an equitable use of government funds.

I am also extremely sceptical that there is enough environmental benefits: the policy appears green but perhaps it is not (greenwashed).

	▲	TylerE 8 months ago \| parent [-]
		My original point is that any subsidy increases the number of cars that are sold, which downstream increases the number available on the used market. Basic supply and demand. Increases supply keeps prices down