Example: Let's say I purchased a car for 1 bitcoin today but next week the value of Bitcoin has doubled meaning I was probably better off using fiat.
Of course I would.
If you already decided that you want to sell some of your bitcoins, it is "cheaper" to buy products directly because you will save a lot in fees.
Exchanges fees are very expensive.
Let's look at Coinbase fees:
So you will pay 2% of your total amount to coinbase just to sell and withdrawal your money, to buy the car.
For a 20,000 car, that would mean 400 USD.
If you buy directly with bitcoin, it would be 2% (400 usd) cheaper