{"id":46597,"date":"2023-05-10T10:10:25","date_gmt":"2023-05-10T17:10:25","guid":{"rendered":"https:\/\/getjerry.com\/?p=46597"},"modified":"2025-01-16T08:51:30","modified_gmt":"2025-01-16T16:51:30","slug":"majority-of-americans-are-one-major-car-repair-away-from-debt-possible-job-loss","status":"publish","type":"post","link":"https:\/\/jerry.ai\/studies\/majority-of-americans-are-one-major-car-repair-away-from-debt-possible-job-loss\/","title":{"rendered":"Majority of Americans Are One Major Car Repair Away From Debt, Possible Job Loss"},"content":{"rendered":"\n<p>Soaring costs for vehicle repairs are breaking American drivers\u2019 budgets, forcing many to borrow money to keep their cars and trucks running and pushing some into delinquency and default on existing <a href=\"\/car-loan\/\">car loans<\/a>.<\/p>\n\n\n\n<p>It\u2019s another side to a growing car-ownership affordability crisis. As with so many products and services in the COVID-19 era, the cost of repairing cars and trucks has surged in recent years, rising 30% since March 2020, faster than overall inflation, which itself was the highest in four decades.<\/p>\n\n\n\n<p>In a survey of 1,400 American car owners conducted by <a href=\"\/car-insurance\/\">Jerry<\/a>, a quarter of respondents (26%) said they would not be able to cover a $500 repair bill if their car broke down tomorrow. More than half (58%) said they couldn\u2019t pay for a $3,000 repair bill\u2014roughly the cost of replacing the transmission on a Honda Accord.<\/p>\n\n\n\n<p>Many are borrowing the money\u201429% said they took on debt in the past two years to pay for a car repair. This is only adding to financial instability for many. Six percent of vehicle owners said a repair bill caused them to default on an auto loan in the past three years.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"765\" src=\"https:\/\/getjerry.com\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-1024x765.png\" alt=\"A majority of American drivers don't have enough money on hand to pay for a $3,000 repair job\" class=\"wp-image-46599\" srcset=\"https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-1024x765.png 1024w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-300x224.png 300w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-768x574.png 768w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-1536x1148.png 1536w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-900x673.png 900w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-400x299.png 400w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-75x56.png 75w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x-334x250.png 334w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/cant_pay_bill@2x.png 1592w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" fetchpriority=\"low\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Key-Insights\">Key Insights<\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Nearly a third of American vehicle owners (29%) took on debt to pay for vehicle repairs in the past two years.<\/li>\n\n\n\n<li>One in four (26%) Americans say they would not be able to pay for a $500 repair job if their car broke down tomorrow. More than a third (37%) could not cover a $1,000 repair job, and more than half (58%) could not pay $3,000.<\/li>\n\n\n\n<li>In the past three years, 6% of American drivers have defaulted on a car loan because repair costs left them unable to keep up with payments or exceeded the value of their vehicle. For members of Gen Z, the figure is 19% and for Millennials it is 12%.<\/li>\n\n\n\n<li>More than one in five American vehicle owners say they would definitely or probably lose their job if their car broke down and they were unable to quickly repair it. Only 41% said they definitely would not lose their job.<\/li>\n\n\n\n<li>A third of American vehicle owners worry \u201coften\u201d or \u201calways\u201d that an unexpected car repair bill will create a stressful financial hardship for them and their family. More than 8 in 10 worry about that at least sometimes.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Repair-Costs\">Repair Costs<\/h2>\n\n\n\n<p>There are multiple factors behind the surge in repair costs. For one, parts are more expensive and difficult to obtain, partly due to COVID-driven supply-chain disruptions. Also, a shortage of auto technicians is adding to pressure on prices, driving up wages and contributing to a record backlog of repair work at shops across the country.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"765\" src=\"https:\/\/getjerry.com\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-1024x765.png\" alt=\"The cost of vehicle repairs is up 24% in just the past two years, far outpacing overall inflation\" class=\"wp-image-46600\" srcset=\"https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-1024x765.png 1024w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-300x224.png 300w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-768x574.png 768w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-1536x1148.png 1536w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-900x673.png 900w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-400x299.png 400w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-75x56.png 75w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x-334x250.png 334w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_CPIs@2x.png 1592w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" fetchpriority=\"low\"\/><\/figure>\n\n\n\n<p>Many of those paying the price are owners of older vehicles, which means tens of millions of people. As prices for new and used vehicles spiral higher, more Americans are buying older cars and trucks and keeping them longer, pushing the average age of personal vehicles on the road to a <a href=\"https:\/\/www.spglobal.com\/mobility\/en\/research-analysis\/average-age-of-vehicles-in-the-us-increases-to-122-years.html\" target=\"_blank\" rel=\"noopener\">record-high<\/a> 12.2 years in 2022. Those older cars need to be repaired when they break down\u2014a nearly inevitable event.<\/p>\n\n\n\n<p>But even newer cars are more expensive to repair, equipped with more sophisticated and expensive technology that requires greater expertise to fix\u2014at the cost of higher wages for technicians. Driver-assistance technologies, in particular, require trained specialists who earn higher pay than the average automotive technician.<\/p>\n\n\n\n<p>Perhaps that\u2019s why people in different income groups, with the exception of the top quintile, reported little variation in borrowing to pay for repairs. Among the bottom four quintiles, 30%-32% said they took on debt to pay a repair bill in the previous two years.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Underlying-Financial-Stress\">Underlying Financial Stress<\/h2>\n\n\n\n<p>Of those 29% of Americans who were forced to borrow money to keep their cars running over the past two years, more than half (56%) borrowed $1,000 or less, including a quarter (24%) who borrowed less than $500, a clear sign of financial stress. Others took on much more debt. Nearly one in five (18%) of those who needed to borrow took on more than $3,000 in debt, while 3.1% borrowed more than $10,000.<\/p>\n\n\n\n<p>Younger generations\u2014Gen Z and Millennials\u2014were more likely to borrow money for repairs than their older counterparts, with nearly half of Gen Z (46%) saying they did so, compared with only 19% of Baby Boomers. Among Gen Z, 15% said they borrowed from friends and family\u2014their most frequent source of funding\u2014while 13% said they took out a bank loan and 9.2% took out an auto title loan.<\/p>\n\n\n\n<p>Other generations relied most often on their credit cards, with the intention of paying them off over time, while 10% of Millennials borrowed from friends and family, 8.6% took out bank loans and 3.2% took out auto title loans.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large is-resized\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"765\" src=\"https:\/\/getjerry.com\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-1024x765.png\" alt=\"Soaring vehicle repair costs are forcing tens of millions of Americans to take on debt\" class=\"wp-image-46601\" style=\"width:1024px;height:auto\" srcset=\"https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-1024x765.png 1024w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-300x224.png 300w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-768x574.png 768w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-1536x1148.png 1536w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-900x673.png 900w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-400x299.png 400w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-75x56.png 75w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x-334x250.png 334w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/repair_debt_all@2x.png 1592w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" fetchpriority=\"low\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Delinquencies-and-Defaults\">Delinquencies and Defaults<\/h2>\n\n\n\n<p>Sometimes repair bills stretch budgets to the breaking point, creating delinquencies and defaults. That\u2019s what happened with many of the people who borrowed money for repair bills. In all, 8.4% of respondents say a repair bill caused them to be more than 30 days late on an auto loan payment in the past three years. That includes more than one in five members of Gen Z, 14% of Millennials and 6.9% of Gen X.<\/p>\n\n\n\n<p>Six percent of American vehicle owners report defaulting on a car loan during the past three years because repair costs left them without enough money to make payments or exceeded the value of their vehicle, rendering a repair pointless. Again, Gen Z suffered the worst\u2014with 19% reporting such a default. The rate was 12% for Millennials and 4.4% for Gen X. Boomers avoided that fate almost entirely, with fewer than 1%.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"765\" src=\"https:\/\/getjerry.com\/wp-content\/uploads\/2024\/12\/delinq_default@2x-1024x765.png\" alt=\"Repair bills have driven delinquencies and defaults on auto loans, especially among Gen Z and Millenials\" class=\"wp-image-46602\" srcset=\"https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x-1024x765.png 1024w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x-300x224.png 300w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x-768x574.png 768w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x-1536x1148.png 1536w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x-900x673.png 900w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x-400x299.png 400w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x-75x56.png 75w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x-334x250.png 334w, https:\/\/jerry.ai\/wp-content\/uploads\/2024\/12\/delinq_default@2x.png 1592w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" fetchpriority=\"low\"\/><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Conclusion\">Conclusion<\/h2>\n\n\n\n<p>The soaring cost of auto repairs is taking a toll on car owners, creating financial difficulties and the stress that goes along with them. While COVID accelerated the cost increases, the long-term trend remains up as car makers deploy ever-more sophisticated and expensive technology in vehicles. Electric vehicles offer hope of lower maintenance requirements, but for now the cost of repairs remains part of an increasingly burdensome affordability crisis for American drivers.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"Methodology\">Methodology<\/h2>\n\n\n\n<p>All survey data is based on a nationally representative survey of 1,431 respondents conducted in May 2023 using Pollfish. Respondents were filtered to include only those aged 16-75 who owned a vehicle and were fully responsible for overseeing and paying for repairs and maintenance on that vehicle. More information about Pollfish and its audiences can be found on its <a href=\"https:\/\/www.pollfish.com\/\" target=\"_blank\" rel=\"noopener\">website<\/a>.<\/p>\n\n\n\n<p>Data on overall inflation and the costs of vehicle repair and maintenance were gathered from the U.S. Bureau of Labor Statistics. The data was indexed to a Dec. 2017 starting point.<\/p>\n\n\n\n<div class=\"wp-block-jerry-meet-experts\" data-wp-interactive=\"jerry\/meet-experts\" data-wp-context=\"{&quot;modalVisible&quot;:false}\">\n  <div class=\"font-circular text-2xl font-extrabold text-slate-900\">Expert-driven. Built for you.<\/div>\n\n  <div class=\"my-3\">\n    <div class=\"flex justify-between items-center py-3 border-b border-neutral-200 cursor-pointer font-semibold text-gray-900\" data-wp-on-async--click=\"actions.toggleModal\">\n  <button class=\"text-left text-base\" type=\"button\">\n    Why you can count on Jerry&#8217;s articles  <\/button>\n\n  <div class=\"transition data-[visible=true]:md:rotate-180 text-xs iconify i--chevron-down text-gray-500\" data-wp-bind--data-visible=\"context.modalVisible\"><\/div>\n<\/div>\n<div class=\"modal-backdrop fixed bottom-0 left-0 right-0 top-0 z-50 overflow-hidden overscroll-contain bg-black\/70 font-body transition-transform delay-100 duration-0 md:relative md:z-auto [&amp;:not([data-visible=true])]:translate-y-full [&amp;:not([data-visible=true])]:bg-black\/0 [&amp;:not([data-visible=true])]:md:hidden\" data-wp-init=\"callbacks.onModalInit\" data-wp-on-async--click=\"actions.hideModal\" data-wp-bind--data-visible=\"context.modalVisible\">\n  <div class=\"modal-view fixed bottom-0 left-0 right-0 flex max-h-[75%] w-full flex-col rounded-t-3xl bg-white pb-7 pl-7 pt-3.5 transition md:relative md:rounded-none md:pl-0 md:transition-none [&amp;:not([data-visible=true])]:translate-y-full [&amp;:not([data-visible=true])]:md:hidden\" data-wp-bind--data-visible=\"context.modalVisible\">\n    <div class=\"modal-header md:hidden flex justify-between items-center pb-1 mb-1 border-b border-zinc-200\">\n      <div class=\"modal-title text-base font-semibold\">Summary<\/div>\n\n      <div\n        class=\"modal-close-btn wp-block-group w-11 h-11 mr-2.5 content-center text-center\"\n        data-wp-on-async--click=\"actions.hideModal\"\n      >\n        <div class=\"iconify i--close text-gray-500 cursor-pointer\"><\/div>\n      <\/div>\n    <\/div>\n\n    <div class=\"modal-body pr-7 overflow-y-auto\"><div class=\"wp-block-template-part\"><div class=\"flex flex-row items-center gap-2.5 rounded-lg bg-gray-pink px-4 py-5\">\n  <span class=\"iconify mt-0.5 shrink-0 self-start text-xs text-primary i--shield-check\"><\/span>\n\n  <div>\n    <div class=\"font-body text-xs font-bold text-primary\">Our goal is clear, trustworthy information.<\/div>\n    <div class=\"mt-1 font-body text-xs text-gray-600\">\n      Our content is created, edited and fact checked by a team of licensed insurance agents, automotive pros and\n      experienced journalists who know the industry inside and out. Facts are thoroughly researched, verified and kept\n      current, and our editorial team is separate from our business partners, so our opinions &#038; tips are unbiased. All\n      insights drawn from Jerry\u2019s proprietary, aggregated customer auto insurance quotes data provide unique, real-world\n      guidance.\n    <\/div>\n  <\/div>\n<\/div>\n<\/div><\/div>\n  <\/div>\n<\/div>\n  <\/div>\n\n  <div class=\"text-base font-semibold text-gray-900\">Our experts<\/div>\n\n  <div class=\"my-8 flex flex-col gap-8 items-center justify-center\">\n          <div\n        class=\"meet-experts-item group relative flex h-auto w-full flex-none flex-col justify-between overflow-hidden rounded-3xl py-9 text-sm shadow-variant-card\"\n        data-expand=\"false\"\n        data-wp-init=\"callbacks.onItemInit\"\n      >\n        <div class=\"grid h-full w-full grid-cols-1 overflow-hidden px-8 md:grid-cols-4\">\n          <img loading=\"lazy\" decoding=\"async\" width=\"250\" height=\"250\" src=\"\/wp-content\/uploads\/2024\/12\/Henry-Hoeing.png\" class=\"size-16 rounded-full md:size-32 col-span-1 md:ml-4\" alt=\"meet-experts-thumbnail\" srcset=\"\/wp-content\/uploads\/2024\/12\/Henry-Hoeing.png 250w, \/wp-content\/uploads\/2024\/12\/Henry-Hoeing-150x150.png 150w, \/wp-content\/uploads\/2024\/12\/Henry-Hoeing-56x56.png 56w, \/wp-content\/uploads\/2024\/12\/Henry-Hoeing-120x120.png 120w\" sizes=\"auto, (max-width: 346px) 260px, (max-width: 576px) 432px, (max-width: 720px) 540px, (min-width: 720px) 250px, 100vw\" fetchpriority=\"low\"\/>\n          <div class=\"col-span-3\">\n            <div class=\"my-4 flex-1 content-center font-circular text-lg font-medium text-slate-900 md:mt-0\">\n              Henry Hoenig            <\/div>\n\n            \n            <div class=\"text-slate-500 mt-2 leading-6\">\n              <p>Henry Hoenig previously worked as an economics editor for Bloomberg News and a senior news editor for The Wall Street Journal. His data journalism at Jerry has been featured in outlets including CBS News, Yahoo! Finance, FOX Business, Business Insider, Bankrate, The Motley Fool, AutoWeek, Money.com and more.<\/p>            <\/div>\n          <\/div>\n        <\/div>\n\n        <div class=\"absolute hidden group-data-[expand=true]:flex bottom-0 w-full h-24 bg-gradient-to-t from-white from-30% to-transparent to-100% items-end justify-center\">\n          <div\n            class=\"flex cursor-pointer flex-row items-center gap-2 my-4 font-circular text-primary\"\n            data-wp-on-async--click=\"actions.onItemExpandClick\"\n          >\n            <span class=\"text-sm\">See more<\/span>\n            <span class=\"iconify i--chevron-down text-xs\"><\/span>\n          <\/div>\n        <\/div>\n      <\/div>\n      <\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Soaring costs for vehicle repairs are breaking American drivers\u2019 budgets, forcing many to borrow money to keep their cars and trucks running and pushing some into delinquency and default on existing car loans.<\/p>\n","protected":false},"author":54,"featured_media":1109,"comment_status":"closed","ping_status":"open","sticky":false,"template":"single-advice","format":"standard","meta":{"jerry_authors":"[{\"id\":\"128\",\"type\":\"main-author\"}]","jerry_author_ids":[128],"jerry_idx_page_label":"","jerry_meta_desc":"Soaring costs for vehicle repairs are breaking American drivers\u2019 budgets, forcing many to borrow money to keep their cars and trucks running and pushing some into delinquency and default on existing car loans.","jerry_related_posts":"[17830,13557,1522,29884,20806]","jerry_summary":"","inline_featured_image":false,"_lmt_disableupdate":"no","_lmt_disable":"","footnotes":""},"categories":[637],"tags":[120],"class_list":["post-46597","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-studies","tag-car-repair"],"modified_by":"bryce.hermsen@getjerry.com","_links":{"self":[{"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/posts\/46597","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/users\/54"}],"replies":[{"embeddable":true,"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/comments?post=46597"}],"version-history":[{"count":4,"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/posts\/46597\/revisions"}],"predecessor-version":[{"id":49419,"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/posts\/46597\/revisions\/49419"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/media\/1109"}],"wp:attachment":[{"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/media?parent=46597"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/categories?post=46597"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/jerry.ai\/wp-json\/wp\/v2\/tags?post=46597"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}