Does it Ever Make Sense to Buy a New Car?

Print Friendly

I’ll probably get in trouble. After all, I write new car reviews. Advising people not to buy new cars is not what you’d probably expect. But, here’s the fulsome scurvy truth: I – and every car journalist I know – drive used. Because we know. And now, I’m gonna spill the beans, give you the Straight Dope – so that you’ll know, too. Here goes.new 1

* A new car is the absolute worst investment you’ll ever make.

That’s not an assertion or my opinion. It’s an incontestable fact. Proof? Show me an investment that is all-but-guaranteed to leave you with less money (a lot less money) than you started with and I will show you a bad investment. Car salesmen often talk about the investment you’re about to make. Well, I suppose for them it is.  But for you? Uh, no. The average new car loses 30-40 percent of its original MSRP value within five years of leaving the lot. How”s that for an investment?

The reality is a car is an appliance – not an investment. There will be no return. You’ll get to use (and hopefully, enjoy) it for a period of time. Nothing more. The best you can do is minimize your losses. Side-stepping new car depreciation – which takes the biggest bite during those first five years from new – is the single biggest (and smartest) way to do that.

* New cars cost you more in ways you may have forgotten to take into account.new 2

Probably the main reason most people buy a new car is because they like the idea of not having to worry (at least, financially) about repair costs for the first few years of ownership – while the vehicle is covered by the new car warranty. That’s absolutely valid, reasonable and understandable. However, you are paying handsomely for that (see the first bullet point above) and not only for that.

When you buy a new car, there will often be sales tax on the purchase. In my state (VA) it is 3.2 percent of the vehicle sales price. If you bought a $25,000 new car (that figure represents the average “transaction cost” of a new car as of 2012) you will be presented with a sales tax tab of around $800. But we’re just getting started. Next, you’ll probably find out that your insurance bill has increased. Because insurance costs are based in part on the projected replacement cost of the vehicle insured – and it will cost more to replace (or repair) a brand-new $25,000 car than it would to send you a check for the $6,500 “book value” of your current (not new) car if it gets totaled.

In the past, it have cost less ot cover a new car because of new car equipment such as ABS, stability control and so on – which were associated in the underwriter’s mind with reduced likelihood of a wreck (and thus, a claim). But all new cars have all this stuff now – so the discounts aren’t what they were. Meanwhile, new cars have more “stuff” – for example, six or more air bags vs. the formerly typical two. Replacement costs are enormous – and this is reflected in the cost of insurance.

Oh, and don’t forget: Some states (and localities) hit you with an annual personal  property tax on top of all this. It’s usually based on a vehicle’s average retail value. A new car valued by the state/county at $25,000 can mean paying hundreds in personal property taxes every year for the next few years – until the car’s value drops.

* New cars add stress to your life.new 3

My neighbor recently bought a brand-new (and $40,000-plus) truck. Last week, he accidentally backed it into a brick retaining wall. About $4,000 in damage to the bumper/tailgate and driver’s side rear quarter panel. He is beside himself. And he hasn’t gotten the letter yet from his insurance co. “adjusting” his rates. Contrariwise, about two years ago, my wife hit a deer – well, the deer hit her – while she was out driving our ’98 model truck. Next day, I used a strong rope and a big tree to pull the bumper back out and used my hand to pop the dents mostly out. It’s not perfect – but who cares? It’s an old truck. I am immune to sweating door dings. I don’t mind driving it in the woods, because I’m not worried about tree branches scuffing the paint. The paint is already scuffed. There are already stains on the seats. Another coffee spill isn’t going to hurt. The steering wheel plastic is cracking. But guess what? All this will happen to your new vehicle, too. Only you’ll be upset about it when it happens.

I’m not – because it already has.

* Today’s used cars are better than yesterday’s new cars.new 4

If you haven’t noticed, modern cars last – and last. And then last some more. It’s commonplace for a late-model car (that’s pretty much any car built since the mid-late 1990s) to go 10-15 years and more than 200,000 miles before it begins to become untrustworthy or a money pit. Over the past 20-something years, manufacturing tolerances have tightened up, processes and materials are much better and production has to a great extent been automated in order to eliminate or at least reduce the quality control issues that used to arise from one shift to the next (and so on). As a a result the build quality -and long-haul durability – of the average late-model car is night-and-day better than it used to be.

That, in turns, means if you buy a four or five-year-old used car with say 50,000 miles on it, you can reasonably expect it to give you no major problems for another 100,000-plus miles and ten years. Of course, it’s important to be careful – and check over any prospect very carefully. Or have it checked out by someone with the necessary know-how. But as a rule – meaning, unless you have the bad luck to land a lemon or choose a good car that had a bad owner who abused it – the odds are excellent that any late-model used car you buy will give you more life and more miles and less trouble than any brand-new car would have back in the ’70s and even into the ’80s.new 5

This is the secret the automakers hope you’ll never, ever learn. Because they need people to keep on buying new cars every six years or so – right around the time they finished paying off the note on the last one.

If you like debt, if you don’t mind losing 30-40 percent (or more) in depreciation on your “investment” – or if you’ve just got to have the latest thing or think that new car smell is worth it – and there’s nothing wrong with any of that – then by all means, go ahead. Sign right up.

But you won’t find me doing it. Or any other car journalist I know. And that ought to tell you something… .

Throw it in the Woods?

Share Button

  137 comments for “Does it Ever Make Sense to Buy a New Car?

  1. mar
    August 14, 2014 at 5:35 am

    Never makes sense here in BC, Canada

    ie: A new 20k car will cost you almost $4,000 in taxes and PDI:

    I’d kill for a 3.2% tax rate lol

    Destination charge $1500 (yes, it is 1/2 in the USA, don’t ask why)
    Taxes at 12% $2400

    • eric
      August 14, 2014 at 5:37 am

      Hi Mar,

      Always good to find there’s a place even worse than the USSA!

      • mar
        August 14, 2014 at 5:46 am

        LOL

        Well there are ways around it…

        Last car, almost new, I had my bro in law buy in Alberta, NO TAX there, then transferred into my name as a gift which avoids BC tax. We just need to be creative!

        • eric
          August 14, 2014 at 8:57 am

          Yup!

          One way is to just buy an old car – ideally, from a private seller. This way, you can adjust the stated sales price such that your tributum (sales tax) is as low as possible.

          F’ em and feed ‘em fish heads!

  2. John
    October 1, 2013 at 12:39 am

    Hello Eric,

    I agree with you. Probably as we are all living in a very time consuming world, and we worry about many things (family, job, money, health, relationships, etc, etc) we feel we don’t have much time to care and be attentive to car issues.

    See, when I was a kid and a teenager I enjoyed reading automotive mechanic books and magazines just for fun and for the sake of understanding how a car work. Cars have greatly evolved since I was a teenager. I don’t have the same time/energy as to go into being very informed and keep with how technology evolves year after year. I have other things to worry about that drain my time/energy.

    This was probably the real reason why I ditched my so beloved and missed Cavalier 2000. I

    In this modern times, we just don’t have time to have fun about our car care and automotive mechanics. Because it is fun!! It is just I don’t have much time, sadly.

    We just want a reliable tool that we don’t have to worry much about it.

    I don’t know!

    But I certainly appreciate your time and energy to read and answer this posts

    I truly appreciate people like you who share your knowledge, experience and expertise…

    Kind regards!

    John

    • John
      October 1, 2013 at 12:46 am

      Oh, by the way, I forgot to mention that I totally plan to keep this Civic for at least 15 years, ideally 20 years. If my Chevrolet Cavalier 2000 lasted 13+ years and still feeling great, my Civic 2010 must last at least 15 years, but my target is to run it for 20 years.

    • eric
      October 1, 2013 at 8:32 am

      Hi John,

      Happy to!

      PS: I just posted an article inspired by our back-and-forth.

  3. John
    September 30, 2013 at 1:22 am

    Hello Pete
    I totally agree with you in your original post. I think buying a car, either new or used, is never am investment. To demonstrate this, I seen people who calculate how many dollars per driven mile you are paying. However, I see it on a different way. I see a car as a tool, period. Let’s say I need a drill to punch some holes here and there in my home. Well, as I never use a drill, I could always borrow it from a relative, friend or neighbor. But what if I need a drill at an unexpected time? It has happened. Then I buy a drill (not a Makita, not a Bosch, not a high end tool, of course!). I have one. I use it barely. Probably I use it only once a year for a couple of minutes. Some might say what a waste of money. I don’t see it that way, because you cant measure its service just counting how many minutes a year you use your drill. Same goes to any tool. I see a car as a tool. And it better be reliable when you need it. See, I had Chevrolet Cavalier 2000. I had it for 13+ years and 60 000 miles on it. Good car, recommend it. A few weeks ago I sold it to a friend and I got a Civic Coupe 2010 manual transmission. Ok, I went Honda because I was told Honda cars last “forever” and are very reliable. It was about 14,400 dollars, used with 5,300 miles on it. Now I feel as if it it was an unnecessary purchase. My Cavalier was doing the job rightly. But I started to have doubts and uncertainties about how reliable it was. No, it was not giving me any trouble. Im a careful guy and I kept it in good shape. Im not a DIY but my mechanic is good. I have good driving habits. Im 38 years old and I don’t like to run fast nor I so like force the machine nor to make the tires screaming. So my 13+ years old Cavalier was good enough for my needs. But for some reason, I started to feel bored about it. I was not that enthusiastic about doing some fixes and giving more maintenance to it. The ABS light went on all the time and while my mechanic told me nothing to worry about it is only a dirty sensor. Well, recently I changed the fuel pump. It was the second time in about three years. I guess my decision to go for a newer used car was 95% psychological. I knew beforehand that my Cavalier was doing the job just fine. But each time I needed to drive on a highway, I felt unsure. I had doubts about its reliability. I thought “what if something goes wrong in the middle of a highway on a rainy day?” From a year or so I started to have doubts about it. Fears about how reliable it was though there was not giving real problems. It was running great. My friend reports me it is running great and he and his wife are happy with it. So, I was told that a car, even if you don’t run it many miles, it still deteriorates slowly as years go by on it. I mean, I was told that regardless of how many miles they have been run, and regardless of how good care is given to it, still the probability of failure increases every year. I think such an idea, played a big role on my decision to go for a newer used car. I don’t know, my Civic runs great but It seems as if I bought a tool too expensive for my real life needs (grocery store, visiting some friends and once in a year driving on a highway) What are your thoughts? Was it a wise decision or was it purely psychological? Thanks!

    • eric
      September 30, 2013 at 7:26 am

      Hi John,

      You raise an interesting question. Many people end up pre-emptively replacing a car simply because it’s “old” – as they see it – or “has high miles.” They fear that if they hang onto it, problems are likely to arise. That the car can no longer be counted on.

      There is some truth in this.

      Machines are exactly like people in that they wear out over time. Even if a car is parked in a climate controlled garage and almost never driven, components will still age. Seals will dry out, rubber will rot, rust will form – and eat away, quietly, at things like steel lines and so on.

      However, most of these things are things that can be relatively easily – and economically - dealt with as they arise.

      Keeping an older car viable (reliable, not a money pit) and knowing when the time has come to get rid of it before it becomes a money pit comes down to being two things:

      Mechanically observational and at least somewhat mechanically competent.

      The two are inter-elated.

      A mechanically competent person understands, for instance, how a car’s braking system works – the principle behind it (hydraulic pressure distributed through a system of steel pipes applying clamping pressure, to use friction to slow the car down) and knows, at least, in general terms, what the various parts are and what they do.

      Because he has some knowledge of how a car’s brakes work – and which parts do what – he will know almost automatically, that after a given interval of time/miles, it is probably time to at least look at the pads, check the fluid level in the master cylinder. He will not not only hear those “funny noises” that crop up, he’ll have a good idea what they portend – and take action (either himself or through is mechanic) before a small, inexpensive thing (worn pads) becomes a big, expensive thing (ruined rotors). When he feels vibration through the steering wheel when he brakes – or the car pulls to one side – instead of fear, he’ll realize it’s probably nothing more than an out of round rotor, fairly easily and fairly inexpensively fixed.

      Same goes for the whole car, as a system.

      It is not necessary to be a trained mechanic or even a DIY adept. But you do need to be conversationally informed, otherwise, you are at the mercy of your car – and the honesty (or not) of your mechanic.

  4. Military Dude
    September 9, 2013 at 8:35 am

    Original Article has many good points,

    But from my experience with used cars and dealing with mechanics,

    More and more; in order to understand smallest issue with the car (sudden engine light with nothing is wrong) you need to have expensive equipment to check it (computers etc), then expensive equipment to repair.

    Repair guys know that you need your car back ASAP; they do every thing to charge you more and more, dealing with them made me sick entirely.

    So I don’t want to deal any of them for a while, regular maint. is cheap and straightforward on a new car.

    There is a reason someone sells the car and you don’t know it; they can refill the AC before you buy it; 3 days later, you deal with AC repair; used cars are AS-IS.

    This is some generalization here; for sure there are good used cars.

    But if I can get a new one with my 10% of my salary, why to settle for a used car? I do work to get such joy,

    • September 9, 2013 at 9:47 am

      Hi MD,

      Valid points, but new cars are not immune from problems, either. I get a new one to test drive every week – and every so often, one will develop a glitch. The “service engine” light will come on. Or the idle will be intermittently erratic (two recent examples).

      True, there’s no worry about expense – because (as a new car) the repairs will be covered under warranty. However, you’re still stuck dealing with the hassle. Which – arguably – is even more annoying. Because, after all, you just paid top dollar to buy a new (and, ostensibly) trouble-free car.

      You can suss out most existing/significant problems that might be there (with a used car) by having it thoroughly checked out by a competent tech. I don’t mean a casual visual inspection and pulling a tire to check the brake pads. I mean a thorough going-over: Compression and vacuum tests on the engine, leak test on the AC, thorough check of all electrical systems, extended test-drive to check for any issues with drivetrain, etc. This level of inspection will typically cost you $100-$150 but is well worth the expense, if only for the peace of mind.

      As a buyer, you can make it a condition of sale that the vehicle be inspected by a tech of your choosing. If the seller balks, walk away.

      Lots of other fish in the sea….

      • Military Dude
        September 9, 2013 at 5:10 pm

        Well on theory, you can early diagnose the problems with competent mechanic. But in practice,
        -If you are buying from a private party,
        You need to drive their place almost always. This can be a place you never been before, so you don’t know any mechanic there. So you either take the car a random place, or the buyer suggest to go somewhere he knew (see the catch)
        When I sold cars used, I right away asked to make 50 dollars deposits; so that I would not waste my time going mechanic with the each buyer.
        If always ask buyer to sign AS-IS document; I wouldn’t like the deal with buyer after the purchase. I think most smart buyers would do the same. When you ask right price, so many so many buyers show up so quick; so sometimes I right away reject to take my car mechanic.

        -If you are buying from dealer; in my experience they don’t let you to take mechanics, you need to bring your mechanic which can be expensive and time consuming.

        With increasing number of sensors in a typical car; most mechanics rely solely on their computer to “diagnose” and start telling you to change this change that instead of a real diagnose. The average expertise of mechanics is downward for the last decade or so, the top mechanics are like gold. So I doubt many of them can find potential problems when there is nothing blinking; I tested this before buying a car and getting checked by a mechanic, and it became a lemon very quick.

        Certified used cars is another nice word but most of the time, it is nothing more than couple thousand dollar more expensive car than the private price with certified word attached. No real checks or repairs what so ever.

        • September 9, 2013 at 10:48 pm

          Hi MD,

          Diagnosing/spotting mechanical wear and tear is really no different today than it was 40 years ago. A simple vacuum gauge and compression tester, for example, can tell you with a high degree of certainty whether an engine is in basically sound condition.

          A competent AC tech can diagnose leaks, over (or under) charging and so on.

          Electrical problems are usually not intermittent – so if the “check engine” light doesn’t stay on and there are no stored codes in the system, it’s a good bet things are ok.

          But the main consideration, as I see it, is the much greater life expectancy of a given late model car. Barring abuse/poor maintenance – or the rare design defect/lemon car – almost any recent-vintage vehicle can be expected to run reliably, with minimal need for more than routine service, for at least 150,000 miles. Therefore, if you buy a used car with say 75,000 miles on it, odds are very good you’ll be able to put more miles on it before it become a money pit than you would have been able to do with a brand-new car made during the ’60s, ’70s or ’80s.

          And because many people still regard a 5-6 year old car with say 75,000 miles on it as “old,” one can often buy that car for half or less what it cost new. Even though it still has a decade-plus of useful life left in it.

          You’ll also pay much less in taxes and insurance – and (where applicable) property taxes, too.

  5. ColeM
    August 13, 2013 at 7:01 pm

    I agree with the original article in theory but I believe the prevailing buy-used mentality is starting to skew the equation somewhat. The price delta between new and 2-3 year old cars with 30-40,000 miles is demonstrably much smaller than it was several years ago.

    Also, by focusing on the pure financial depreciation people seem to overlook the fact that the car has, well 30-40,000 miles of wear and tear. That is also depreciation and not inconsequential. You end up paying one way or another.

  6. joeallen
    April 23, 2013 at 1:15 pm

    Buy a new car? Yes, I did 21 years ago, still have it now with 402,000 kilometers on it. I do 90% of my car repairs. Mine has no airbag, or ABS, and is a full size wagon, with a towbar. Lots and lots of parts have been replaced, but hey it’s all paid for and I don’t have the cash to buy another car anyway.

  7. Gonzalo
    April 18, 2013 at 1:41 am

    Maybe true in most cases. I don’t know for sure. But certainly not true in my case.

    I am sixty-five and have owned seven vehicles in my lifetime. Only the last one I bought brand new: a Ford F-150. It is a 1999 model bought more than fourteen years ago. It now has 275,000+. Mile for mile, it has been clearly the cheapest vehicle I bought when adding my original cost, interests until I paid it off well before the term expired and all repairs. And it played a role in helping me make money as well as facilitated a lot of other things. All but one of the used vehicles I bought gave me trouble. The first one when I was a young man was in an accident. Someone hit me in the back, and the insurance gave me more money than I paid for it. But heck, I don’t think I should count that. The fourth one was also in a wreck, and because it was old too, I got more than I put into when it was totaled. So, if I take that out of the equation, I really made the best deal when I bought the new vehicle. Maybe I just got lucky, but the aggravation, time and expense that I saved myself was more than worth it–and it was still cheaper mile for mile.

    • April 18, 2013 at 9:14 am

      Hi Gonzalo –

      Of course, there are numerous variables that will affect each individual outcome. One such I probably should have mentioned in the article is the owner’s ability/inclination to perform maintenance/repair himself. I do virtually all my own work, which means that for me, most repairs usually entail just the cost of parts. This probably reduces maintenance/repair costs by two-thirds and that, of course, affects the total cost to keep a given vehicle.

      New cars are covered under warranty for at least three years/36,000 miles (industry minimum these days) and many have much longer comprehensive coverage on the powertrain. That obviates much of the cost issue with regard to repair. But, you pay a premium “up front” (the cost of the new car) for this – and of course, routine maintenance is (usually) not covered, even with a brand-new car. So, if you don’t DIY, you still have to pay full freight for those things.

      You’ve gotten your money’s worth by doing the one thing most car buyers do not do: You kept your new car for 14 years and put 275k-plus miles on it.

      Smart!

  8. Tim from the Bay Area
    April 17, 2013 at 8:18 pm

    Defitely need analyze each situation on its own merits.

    When my 6 year old paid for Xterra with only 70k was totaled by an uninsured driver last november (thats another discussion) i got what i beleived was a generous settlement from my insurance company. i could not find a similar car with similar miles in teh greater bay area for sale and what i could find taht was simialr had a LOT more miles for less money.

    My wife, shes the daily driver of said SUV hauling my 2 small kids around, had a very specific and short list of requirements for a replacement.

    So we decided on a Toyota 4runner. Again, here in teh bay area there at more than a dozen toyota dealers within an hour of where i sit. I also looked at craiglist. Any newer 4runner with the options i wanted was being asked for almost as much as brand new at a dealer and some of these cars despite being 10, 11 and 12 model year already had very high milage i consider 25k+ a year a lot of driving, since my wife and i do less than 15k between 2 cars.

    Anyway, i was able to find the car i wantd new at a dealer, with the options i wanted ( 4wd, 3rd row seat, and satelite radio) i was able to eventually play a few dealers against each other to get the best price i felt i could. vs the simmilar car used with several to many thousands of miles. Yes i know toyotas will run many hundred of thousands and i intend to keep this one till the wheels fall off.

    shopping for a used is a challenge also. I would love a 1999-2004 tacoma, 4wd, 5 spd. do you know how hard that is ? used guys want $10k+ for specimens with 100k, sometimes 200k or more miles, and the reputation & expectation is they will go at least that many more. Dealers want a few dollars more than that if you can find a dealer with a car this old in inventory. And the few i have seen dont last very long on dealer lots.
    these trucks retailed new for less than $20k 10+ years ago when new. People just dont sell them unless they are dead or dying, and they are hard to kill.

  9. Derrick
    April 17, 2013 at 6:43 pm

    If everybody took the advice to not buy a new car, eventually there would be no used cars on the market. Cars have to be purchased new before they can be available as used.

    • April 17, 2013 at 7:26 pm

      That’s absolutely true, Derrick – but it’ll also never happen. Some people will always buy new cars – leaving the rest of us to buy them at much-reduced cost later on!

    • Douglas
      April 18, 2013 at 12:57 am

      If cars were sold on mere utility, we’d still be driving Model Ts with choice of any color as long as it’s black. Cars and Trucks, in the final analysis, are sold on the basis of tastes, comforts, and styling, and NOT necessarily on utility. It’s called marketing. Detroit and Madison Avenue have practiced their craft for over a hundred years, and DO NOT assume that you’re likely to beat them at their game. And it’s all right. Most folks will buy as much car as they can impoverish themselves for. I’m not saying that buying new NEVER makes sense, but most of the reasons that Americans succumb to marketing and peer pressure to commit money they can’t really spare for more vehicle than they can realistically afford certainly doesn’t. Of course, these same idiots will go every day to Starbucks or Peet’s and drop four or five bucks on a “latte” when my Pop, career Air Force, afforded a nice home in suburban Maryland and then Central Florida on his salary, with Mom at home taking care of us kids. He made himself a pot of Folger’s then (he’s now drinker’s Taster’s Choice or Sam’s Club instant), drank one or two cups with breakfast and/or shaving, poured another into same cup to balance on his lap while driving to work, and poured the rest into a Thermos to sip on all day. This led to some great hilarity when he’d scrape the ice off the windows of the ’60 Beetle that he drove to work (the tribe would pile into a ’68 Chevy Bel Air Wagon, the metallic green battleship) and place the coffee cup on top of the car while he went to work…more than once he had a cup of ‘iced’ coffee stuck to the roof!

      • April 18, 2013 at 12:56 pm

        I’m for striking a reasonable balance.

        Not many (me included) want to drive around in a Model T with mechanical brakes and a top speed of 35 MPH.

        On the other hand, I don’t feel the need for 6-8 air bags, radar-assisted cruise control, Brake Assist, back-up cameras and such like.

        What I’d like to see is the market de-regulated so that any conceivable type of car could be offered to succeed or fail on its merits. Let people decide for themselves what they want in a car. Everything from a modernized version of the VW Beetle (the old model) sold in no-frills form for $6,000 – all the way up to 240 MPH 9 MPG supercars that cost $500k.

        Instead, we have a government that dictates to the industry, which in turn provides us with greatly limited choice vs. what would otherwise be the case.

  10. Joe
    April 17, 2013 at 5:25 pm

    There is NOTHING like the look, sound, feel, and SMELL of a NEW CAR.

    Yea, you could go thru life driving beaters, wearing worn out clothes, eating fried baloney sandwiches everyday for lunch, but what would be the point in living?

    • April 17, 2013 at 7:28 pm

      Hi Joe,

      If it’s worth it to you, then by all means… nothing wrong with buying a new car for those reasons, if those reasons are sufficiently important to you. Everyone has different priorities – and there isn’t any “right” or “wrong” here in that sense.

      You’ve got to do what works for you.

      For me, vehicles for everyday use are just appliances. I buy what I need – and no more. That way, I have the funds to spend on my toys – my classic muscle car and my motorcycles!

    • DownshiftFast5to1
      April 18, 2013 at 1:37 am

      New car smell, I used to like it too, now I’m not sure if even old car smell is something to tolerate, let alone new car smell:

      “… Have you ever read your car users manual? Most people don’t. When I read this story, I actually went out to the car and read my manual for the first time. Sure enough, it says plainly, “In a hot car, do not turn on your air conditioner without opening the car windows fully to circulate fresh air into the car.” It doesn’t say why.

      Here’s why…”

      http://modernmarketingjapan.blogspot.com/2011/08/benzene-in-cars-this-will-kill-more.html

      • Tor Munkov
        April 18, 2013 at 8:05 am

        “Check out my new car, Becky! Breathe in deeply, all the ethyl benzene, xylene, formaldehyde and toluene, isn’t it intoxicating? A sweet elixir of chemical castration, carcinogens, catatonia and sterility. It’s the maximum allowed outgassing by the DOT. I can’t believe it’s legal to enjoy this high and giddiness from targeted brain damage by phthalates, plasticizers, adhesives, and sealants. I love the smell of napalm and new car smell in the morning!”

        “Where were we planning to drive to, Becky? I can’t remember. Buckle up and mute your cellphone, we’re going to the mall to buy a bunch of trinkets with our charge cards. Change the radio station to NPR, we both need to be fully informed citizen. God Save Obama, he has finally healed the economy and it’s safe to be a mindless consumer again.

        Just like Grandpa enjoyed the smell of leather, Dad enjoyed the smell of castoreum and birch tar, now we enjoy volatile polymers breaking apart and randoming attaching themselves throughout every cell of our bodies.

        http://en.wikipedia.org/wiki/New_car_smell#Chemical_composition

        http://www.sisweb.com/referenc/applnote/app-36.htm

        “Although the concentrations of volatile organic compounds significantly reduce over time in a new automobile, the exposure to such compounds that were identified should be of concern to both the automobile industry and health officials.

        Air samples show that the public is constantly in contact with a wide variety of potentially harmful VOCs due to cleaning supplies, lubricants and fuel by-products. Because of the potential toxic nature of many of these compounds, additional knowledge of the levels of these organic compounds in the car’s interior is required in order to determine human health impacts.”

  11. z
    April 17, 2013 at 4:43 pm

    I bought a 2012 Elantra limited new for 23k. I’ll keep it for 12 years and probably/hopefully have any major issues with it. It’s crazy how little it has depreciated according to the NADA, I don’t really understand it. In my case I’m glad I bought it new.

  12. Dutch
    April 17, 2013 at 4:14 pm

    Great topic and one that I practice completely. Just wanted to offer one tidbit to elaborate on the idea. In the auto industry (in which I have years of experience) it is commonly understood that time is more detrimental to a car than use. This being the case, what I do is buy a car with a solid powertrain and an interior that is in serviceable condition. I will typically then immediately replace any/all parts prone to degradation: radiator and hoses, brake pads and rotors, fuel filters and any rubber fuel lines, electronic sensors, and most critically, the water pump. Obviously refreshing any associated fluids in the process. Typically all of this can be done by any competent home mechanic in a day and for about $1000. Assuming your powertrain is solid, these updates will pretty much make any used car very close to like new from an operational perspective. And the $1k price tag is nowhere near the depreciation on a new car that won’t guarantee any greater longevity or performance. I currently have 2 cars, both with over 150k miles. Both run like they did the day I bought them, and without question will give me 3-5 more years of service with minimal maintenance. In the 9+ years that I’ve had them, their total cost, including all maintenance has been less than $30k. Roughly the same price it costs just to drive 1 new car off the lot. And even if you have two left thumbs, so long as you have a trusty mechanic, you can still do this for roughly the same cost. From a cost/benefit perspective, there is no justification for buying a new car ever.

    That said, as a used car buyer I have to appreciate the fact that some do still buy new. Those good people unselfishly suffer my significant losses on behalf, without even knowing me. How nice.

  13. tom
    April 17, 2013 at 3:56 pm

    My things with used cars are this: Every used car you look at is a unique specimen. Meaning the first 02 corolla you saw on the West side of town is different than the second 02 corolla you saw on the East side of town on Saturday when you were out looking at cars. New cars do not have this facet factoring into their purchase. If you wrench on your own cars, you know what I’m talking about. And then when you know it, you have to move out quickly to buy that unique specimen of a car that you are inspecting for purchase!

    Older used cars (10yrs old) are a crapshoot. I understand that there are typically some sunk costs with bringing one of those cars up to snuff. But sometime you can start throwing good money after bad. So, with that said, I think the worst used car buys are ones that are 7yrs old w/100k miles on it.

  14. Bill
    April 17, 2013 at 3:41 pm

    I haven’t read through all the comments, so don’t know if this observation has already been posted. SOMEBODY has to buy a new car – otherwise there wouldn’t be any used cars.

  15. phil
    April 17, 2013 at 2:28 pm

    Chrysler offered an unlimited milage and timeframe drivetrain warranty for 08-09. I took a gamble that they would still be in business for a decade or two and procured a new wrangler (its nothing but a box on a drive train anyhow). I read the small print, the caveats are you have to get in inspected every 5 years within a 1 month window of when you purchased it, and be the original owner. I was up for the challenge.

    Im going to drive it until the wheels fall off. Then they are going to pay to put them back on. Repeat until the company or I die.

    My hunch is that they were banking on (wisely) people being enticed by such a deal, one that most would never make good on once they got tired of their vehicle. A jeep is something else though, it ages like wine.

    Anyhow, just sharing a story of the one time I was enticed to buy new.

    • Douglas
      April 18, 2013 at 12:47 am

      You already paid for it. Chances are that DaimlerChrysler purchased an insurance policy before they even announced such an offer. Even though they’ve since migrated to Cerebrus Management and now Fiat, and through B/K, AFAIK they’re still bound to honor that warranty, so stick it to them.
      It’s like one day at the erstwhile Sundowner Casino in Reno (since demolished), I was playing blackjack at a three-dollar table one fine morning, and I inquired about the side bed (you bet on getting two cards in the same suit on your first two cards, which paid three-to-two, and if you got King and Queen, ten-to-one). The dealer, a nice middle-aged woman, said that she herself never played it as it was a “house bet”. I deftly replied (taking care of my then g/f next to me), “Sweetie, it’s ALL a ‘house bet’, else management wouldn’t offer the game!”.

  16. April 17, 2013 at 1:01 pm

    I have found that it is cheaper to run a girlfriend who has a car than both a girlfriend and a car – whether new or slightly used in either case.

  17. Ed
    April 17, 2013 at 12:50 pm

    “damned if I’ll pay any property taxes that I can avoid!”

    Oh, hail yayuh. Starve the beast. I wish more people had your attitude, bill.

  18. bill
    April 17, 2013 at 11:42 am

    I agree! As for insurance, all you need on an old used car is liability, Va.’s awful personal property tax is much lower as is the title tax. Whenever I think about replacing my 20+ year old F-150, I think of all the repairs the taxes on a replacement would pay for. I could pay cash for a fleet of new cars but damned if I’ll pay any property taxes that I can avoid!

  19. Joel
    April 17, 2013 at 9:42 am

    I don’t worry about scratches on my ’92 Cherokee because it’s coated in Bed Armor. Just wash, dry and spray to touch up. Too bad my wife won’t let me do the same to the Odyssey…

    • April 17, 2013 at 10:29 am

      Good one!

      I have five motorcycles. The one I ride the most is my “rat” bike – an ’83 Honda GL650 Silverwing Interstate. Reason? I don’t mind it getting wet – or dirty. It’s not a POS – but unlike my others, it is also not a meticulously polished show piece, with every nook an cranny clean and all the paint like-new and so on.

      Another scratch won’t bother me. If the paint fades some more, it’ll be ok.

      Mechanically, the bike is super tight. But I don’t sweat the cosmetics.

  20. Ross Nelson
    April 17, 2013 at 7:34 am

    Whew, Eric, you think a ’98 is an old truck? My Dodges from the ’80s, which are all driven, would disagree. I’m not sure that new cars on net do last longer, or at least are cheaper to run. They’re bodies are definitely more rust resistant than older cars, but their complexity makes them godawful expensive to maintain when something goes wrong.

    Memories of spending 15 bucks for plugs, condenser, cap and rotor to do a tune up with my timing light and dwell meter speak to me of a day when old cars, if you could keep their bodies together, were cheap to keep running a very long time.

    • April 17, 2013 at 10:13 am

      Hi Ross,

      Yup!

      The main issue with pre-1990s stuff is rust. My ’76 Trans-Am, for example. The engine is the essence of simplicity and would cost very little to maintain almost indefinitely. But if I drove this car regularly (it’s garaged, under cover and only goes out every once in awhile – nice days only) it would have severe rust issues within three or four years. This is not just a cosmetic issue, either. Within another few years, if driven regularly – and subjected to road salt and so on – it is very likely (almost certain, in my experience) that the frame rails/mounting points and so on would deteriorating, perhaps to the point that the vehicle was becoming structurally unsound. At this point, the cost to repair is usually economically prohibitive – unless the car is a valuable classic, etc.

      This is the main reason why the really old stuff is – mostly – gone today.

      • Douglas
        April 18, 2013 at 12:40 am

        Get underneath your old ride with a wire brush chucked into a drill (wear eye protection). Spray on underbody coating liberally. Check quarter panels, clean out the rust, go to it with Bondo and primer. Take the beast to Earl Schieb, it won’t look bad for $300 to $400 and it’ll hold back the corrosion. I grew up in Florida…marine air and perpetual humidity are “moider” on car bodies, but you can keep ‘em going. Also, try to have no more rides than you can garage or at least park in a covered spot (a rule that I’ve violated myself).

        • April 18, 2013 at 9:20 am

          Hi Doug,

          Yup!

          POR-15 is the best product I have ever discovered for preventing/protecting against rust. It is ideal for coating frames and so on. Dries to a porcelain-like finish and looks great, too.

  21. Strder55
    April 17, 2013 at 6:24 am

    Whether insurance costs rise with a new car depends on the car. Last year my wife bought a new Prius C. A few weeks later the insurance company direct-deposited ~$18 into our checking account. When we asked the agent about it, we learned that it was a rebate — the Prius C cost less to insure than her 6-year-old Honda Civic.

  22. Anti Federalist
    April 17, 2013 at 5:10 am

    Damn it Eric, I broke with that same cardinal rule, that I have been following for over thirty years of driving every sort of vehicle out there, namely NO NEW CARS.

    Broke it just this weekend, based in no small part to your positive reviews, and sprung for the VW Jetta diesel wagon.

    With a manual transmission and no other luxury items other than sun roof (not my choice, I wanted a stripped base model, but this was the only one within 300 miles of me that was the right engine/drivetrain/color combination.)

    So far I am enjoying the hell out driving it…but I took a few years off my life when I came up over a rise and found a five gallon bucket of white paint, smashed and splashed all across the road, and no way to stop that all black Jetta in time to avoid the paint spill.

    Luckily it was dry, but that knowledge came too late to stop that hot, coppery, nasty taste of an adrenalin surge from making itself known on my palate.

    Almost as bad as seeing the rollers flash to life right on your ass.

    Maybe I’ll spare myself the anguish and just give it a small nick somewhere to be done with it.

    Buyer’s remorse?

    Not quite, but I will admit, it’s gnawing at me.

    • April 17, 2013 at 10:23 am

      Hi AF!

      What you describe is the main pain (for people like us) that attends buying new. The first time you come back to the car after shopping and find some asshole has put a quarter-sized dent in your door because he was too inept to park with sufficient clearance – and too much of an inconsiderate jerk to leave you a note with his insurance info. Etc.

      But, this will pass.

      My approach with that VW – which I am betting will be your approach – would be to drive the wheels off of it. Probably, it will serve you well for 20 years and 300k. Maybe more. Keep it around long enough, and you’ll end up upside on the deal. With a diesel, this is still very doable.

      I’d be more ambivalent about a gas burner….

      • Anti Federalist
        April 17, 2013 at 11:23 am

        Eric,

        Appreciate the reply, and yes, that is precisely the plan, to run it into the dirt, or as much as that is possible, before all the electronic and computerized do-funnies start getting automotive Alzheimer’s.

        Rust may have been death for the older cars, the networked electronic systems, half digital, half analog sensors and all the rest is what I fear will doom this vehicle at the end of its service life.

        I think the only thing that would give me true buyer’s remorse at this point is if the market suddenly floods with a whole slew of competing small diesels, that would have afforded me more choices and lower prices.

        Not saying that is bad thing though, there should be no reason at all why millions of small diesel cars and trucks are not on the road right now.

        Of course, we both know why that isn’t happening.

  23. Fres
    April 17, 2013 at 5:06 am

    My father taught me to be very cautious whenever considering the use of the words always or never. Absolutes rarely are – except for perhaps taxes and death. Vehicles in general certainly aren’t investments – except for investment vehicles. And except for those of us who can afford to buy investment vehicles, the rest of us buy vehicles, new or used, which are tools – to be used and to depreciate over time. And some people like to buy new tools – and some like to buy them used. The makeup of the total cost of vehicle ownership includes much more than its purchase price. Additional expenses include depreciation, insurance, maintenance and repair, taxes, and gas. As I stated at the beginning, I would cautiously suggest anyone neither always or never buy either new or used vehicles only – but instead for each to consider his or her particular situation, and to decide what makes the most sense for him or her. And by the way, I spent decades selling thousands of new and used vehicles.

  24. brevard bum
    April 16, 2013 at 6:27 pm

    My first three cars were all over 7 years old when I bought them. I kept each one five years or more. I put in routine maintenance and did all the work myself. When buying a set of tires essentially totaled the car, I got rid of it.

    I bought a 1993 S-10 pickup brand new. It lasted 12 years and 210k miles. When I traded it, it was leaking 2-3 quarts of oil every tank of gas. I got tired of smelling like a deep frier at a fast food restaurant. I traded it in for a 2005 Silverado, again brand new. I will keep this truck until it is no longer drivable. So far, I have 8 years and 112k miles.

    The next purchase will be a used truck, hopefully about 4-6 years old and with less than 50k on the odometer.

    The wife insists on brand new and she likes to purchase new as soon as the loan is paid.

    I do not like to criticize people for how they want to spend their money. It is your right to spend your money any way you want as long as it is your choice.

    I await the day when guvmint forces people to buy new cars by a means test. They means test tax bills, insurance and before long, they will means test social security. Don’t kid yourself. The day is coming.

    • DownshiftFast5to1
      April 17, 2013 at 3:45 am

      “Don’t kid yourself. The day is coming.” <- That has two or three different meanings.

      Reminds me of a thought I saw on another blog along these lines, "One thing is clear, whatever happens, things aren't staying this way for long."

    • Just Dont Get In My Way
      April 17, 2013 at 7:42 am

      I think in Japan, the taxes on a car go up as it gets older. At some point, due to this inverse tax system, it makes economic sense to buy another car. I don’t know if this is really true, but when I was in Japan, I was told of this. It sounded like a car manufacturer’s dream come true. They must have good lobbyists over there. Does anyone else know about this vehicle tax issue in Japan? I’m not really sure it’s true.

      • Jon
        April 17, 2013 at 8:20 am

        I think it would be, NZ is awash with second hand Jap imports.

      • April 17, 2013 at 8:46 am

        I was told that the laws there prohibit cars with any visible damage, even that does not affect their function, from operating on the roads.

        This forces them off the roads, and forces consumers to buy new cars.

  25. Tery
    April 16, 2013 at 3:45 pm

    I purchased a new 1989 Chevy Geo Spectrum, drove the pee out of it and ended up giving it away. It had 210,000 miles on it and still had its’ original clutch, starter, alt, etc. only replaced needed items like tires exhaust. On the other hand I purchased a new Old Cutlas Convertible and treated it like royalty. Garaged every winter never touched snow, regular maintenance etc. Motor blew at 48,000 was in the shop for misc stuff all the time. car now sits in the garage with new motor and bad fuel injectors worst car ever bought.

  26. Eli
    April 16, 2013 at 3:41 pm

    A long time ago I did the math on all aspects of car ownership. No matter what gas costs, tires cost, insurance costs, nothing and I mean nothing ever comes close to the initial cost of buying the vehicle when factored on a cost per mile basis. So it is never worth it to buy a new one to say, get better gas mileage… Depreciation especially on new cars is the single biggest expense, and it probably always will be.

    I did buy a new car back in 09, it was a leftover 07 and was $10,000 off msrp so essentially the dealer took the depreciation hit for me. I could have traded it to another dealer immediately at a profit, but I didn’t because I like the car and plan on owning it for decades. Barring another situation like that I don’t see myself ever buying another new one.

    • Darvel Silda
      April 17, 2013 at 4:50 am

      Was that 1909???

      • Eli
        May 3, 2013 at 4:13 pm

        No it was 2009. The dealer was a ford Mazda combo that had either lost or was giving up the Mazda side of their operation. It was one of the last Mazdas on the lot.

  27. Krupp
    April 16, 2013 at 3:18 pm

    Yes,
    this is all very true. Also, you forgot to mention that a low mileage used car with dings… you can really save a bundle. Or one with the paint peeling. Only one issue you forgot to mention. For I time I lived in a metropolitan area where honest English speaking mechanics were not to be found. Most were middle eastern. It cost a great deal of cash for poor or non-existent repairs. The key is to live in a town where you do not have foreign mechanics and only sky high dealers to go to for maintenance. I got a bid once of 3,500.00 dollars minimum to fix my chevy transmission. So I drove about 100 miles away to a “Good Old Boy” garage.. Never knew him. Told him to fix it and give me an estimate. He went ahead and repaired it, phoned me with a bill of $75.00 plus tax. Yes, he was not middle eastern. So, I am in 100% agreement..but you need honest repair facilities.

  28. Damon
    April 16, 2013 at 11:59 am

    It’s funny how folks began using “investment” for large ticket items like cars, large home appliances (tv, oven) and houses. None of them are investments as has been mentioned. Only in certain regions might a house be considered an investment.

    If people got out of the mindset of “investment” they would be better off. I’ve had new and used cars. Doubt I’ll go back to new unless I marry up into a higher tax bracket. :)

    • April 16, 2013 at 1:35 pm

      Dear Damon,

      That’s been one of my peeves too.

      Since when have mechanical devices subject to wear and obsolescence, such as automobiles, refrigerators, washing machines, kitchen ranges, air conditioners ever been “investments?”

      They are expenditures, not “investments.” Never were. Never will be.

      The only exceptions in the automotive field are bona fide collector’s items. The Aston-Martin DB-5 driven by Sean Connery in “Goldfinger” perhaps. That popped up in my mind. Choose your own examples.

      Interestingly enough, firearms really are an “investment.” I’ve never lost money on a single gun I bought then sold years later.

      They turned out to be excellent investments even though I never intended them to be. Basically I got to use them for free for years, then made a small profit.

      • Damon
        April 16, 2013 at 6:08 pm

        I wouldn’t classify firearms, unless they are collector items, as investments. SOME might be, like say AR 15s or other popular firearms, but ALL of them? No.

        Of course I’m speaking generally for whole classes of items, not specific examples.

        • Boothe
          April 16, 2013 at 9:13 pm

          I tend to agree with you Damon. Some firearms like a pristine L.C. Smith side by side, an antique Holland & Holland rifle or even the older Colt wheel guns will actually appreciate in value. The trick is to find the next investor / collector that will pay the full premium when you need to sell.

          But to me good quality common firearms equate to gold and silver coinage: they are a store of value and a hedge against inflation, not really an investment. And only so long as they are well taken care of (e.g. NIB or seldom used safe queens). It may seem that we get to use one for free for many years and, even with some wear and tear, sell it later for a small profit. In truth, the perpetual devaution of the dollar over the last century actually ate part of the capital you “invested.”

          I think if you based your amortization on the value of a real dollar in 1913 versus the value of that dollar today, you’d find that most common “used” firearms lose value over their life just like any other consumer commodity. We’re fooled into believing we gained because the banksters skew our viewpoint by stealing all annual productivity gains (and then some) along with our purchasing power through monetization.

          • April 17, 2013 at 1:05 am

            ” they are a store of value and a hedge against inflation, not really an investment.”

            I would not quibble with this.

            This is closer to what I actually meant.

            My point was that cars are definitely NOT “investments.”

            Guns are closer to fulfilling the requirements for the appellation “investment.”

            But “store of value” and “hedge against inflation” are perhaps more exact.

          • BrentP
            April 17, 2013 at 2:00 am

            The right cars (ones that don’t get driven) can be investments and stores of wealth. The problem is they need work and care or they won’t be either.

          • DownshiftFast5to1
            April 17, 2013 at 3:33 am

            Some of you guys keep throwing around the word ‘investment’ in a way I can’t understand.

            Housing is/has been said to be an investment, but for the most part it hasn’t been.
            A rental house that has a return is an actual investment. A house you live in, that’s a liability… unless you have borders or ten thousand chickens or something providing some kind of return.

            A hay bailer that allows a person to generate income, is an investment.

            I suppose – to a point – a car which allows a person to drive back and forth to work, is an investment. Anything much over $1000 might just be an extravagance.
            Certain 4×4’s in snowy areas being an exception.

            But these other things, like an antique car, or an antique or unique gun, or even a run-of-the-mill gun
            (unless they’re used for self-defense?) they’re not investments, they’re speculations or something. Jmho.

            • April 17, 2013 at 10:41 am

              I agree with those who put it this way:

              A house (and a gun and so on) can be a way to store value. You might not earn income (the thing you want with an investment) but you will have a tangible something that has inherent value. Something that’s also fungible to an extent (i.e., can be converted into income, if need be).

              I’d rather have, say, 200 acres of land than a stock portfolio.

          • April 18, 2013 at 5:19 am

            Apropos of this, see the article on record high-end collector car auctions in this magazine; http://www.hemmings.com/hsx/stories/2012/12/01

      • April 17, 2013 at 12:53 pm

        Here in Australia, politicians routinely describe their spending as investment, e.g. spending on education. I imagine things are much the same elsewhere. But in my book, something only counts as investment if it directly or indirectly yields a return over time, whether as a dividend, by appreciating, or by operating in a valuable way. That even covers things that wear out and don’t pay directly, if they help cut some other expense like commuting by public transport – but, no matter how worthy, government spending on education etc. doesn’t qualify.

        • April 17, 2013 at 1:39 pm

          Politicians describing the spending of other people’s money as an “investment” … always makes me furious.

      • Douglas
        April 18, 2013 at 12:34 am

        Correct. Vehicles are generally NOT “investments”, they are holes in time and space into which one pours a LOT of money. Their purpose is ultimately TRANSPORTATION…the utility thereof and comfort within is a matter of taste and budget. Supposedly what we’re discussing are ways to minimize that cost, notwithstanding efforts of “Gubmint” to fleece its subjects at every fucking turn. To wit:
        1) When the vehicle is purchased or leased, you pay sales tax, in some states as much as 9.5%
        2) Most states charge sales tax on used as well as new vehicle purchases. Talk about taking multiple bites out of the apple. CA even levies sales tax on a private party transfer, so there’s often a game of lying about it.
        3) Fuel taxes, which have both a fixed component AND a percentage component, amount to about 20% of fuel prices in most states. And as if nearly $4.00/gallon (higher for diesel) isn’t bad enough, liberal idiots want to raise the fuel taxes on the ground that it will ‘incentivize’ the sheeple to choose ‘mass transit’ (I say the incentive, motherfuckers, should be to quit screwing with our pocketbooks lest we decline to forget about the next election and just lynch you all!).
        4) Registration and vehicle license fees, and in some states, personal property taxes. As with my late model Ford, my other rides, all decidedly elderly as autos go, increase in cost every year.
        5) Never EVEN mind the endless prowling by our fave thugscum looking for every excuse to write citations (and in many cases just flat out lying about it). Of course, we need the friendly “ossifers” to protect us from when we peons are too ‘stoopid’ to not wear seatbelts, or not PROPERLY secure our little kids in car seats (many parents have been cited when they’ve had their darlings in car seats if in the officer’s opinion they weren’t ‘properly’ buckled in). Here in my Sacramento-area community, there are intersections that I avoid altogether b/c they have those “red-light” cameras, and, surprise, surprise, I see those things flash even when the light is green or yellow!

  29. DownshiftFast5to1
    April 16, 2013 at 6:51 am

    “The used car takes a good long while to find if desired in any particular way.” <- Some people call that a horror, while others call that, Fun. Yup, it's a choice. One we still get to decide, so far, anyway.

    Still, buying new…

    I know someone who bought a new car seven years ago. The state gets about $200 more per year for it than I pay them for my used backup 4×4.

    $200 x 7 = $14,000, or about twice what I paid for the purchase price of my 4×4 12 years ago, Plus all the expenses I had, Plus the amount the state claims. That person is paying A LOT to avoid repair bills and having to buy new tires a few years in while saving a little time.

    If they keep that vehicle until it gets to 200,000 or 500,000 miles, I think perhaps they will have paid to the state in registration fees more money than I've ever spent on cars my whole life. And even if they keep the vehicle in prime condition I doubt it will ever have 'value' the same way the older cars do now.
    Yup, it's a choice.

    • April 16, 2013 at 9:43 am

      Hi DS,

      Yup, the personal property tax can quickly add up to an enormous sum.

      The neighbor I mentioned in the article who damaged his new truck? He is paying probably $700 a year; my ’98 costs me $70.

      But even at $70, over the past ten years, I had paid $700 for the privilege of being allowed to keep the truck I paid for in cash ten years ago.

      • tom
        April 17, 2013 at 3:34 pm

        Hey: I have an idea. So buy a car…. say a 1997 Oldsmobile, but put a new engine, tranny, interior and paint job into it. That way, the state thinks you have a “1997 Oldsmobile”, but you actually have a nice, refurbished, nearly-new (from a utilitarian point of view) appliance.

      • Douglas
        April 18, 2013 at 12:15 am

        Ask anyone about real property tax: your local municipality is the landlord of last resort, even if you own your abode “free and clear”. NOPE.

        • April 18, 2013 at 9:24 am

          Oh yeah… I have ranted at length about this in the past. Endless “rent” payment to the county/state – even decades after you’ve “paid off” your home/land. Even out here in The Woods – where our “rent” (property tax) is literally a third of what it was in Northern Virginia – we pay close to $2k every year to these sons-of-bitches for the privilege of being allowed to use the land and live in the home we paid for back in 2004. Let’s say this “rent” payment never goes up (it does, almost every other year). Over the next 20 years, these bastards will have raped us of $40,000.

          That’s on top of the 40 percent off every dollar they steal from me every year.

    • BrentP
      April 16, 2013 at 1:25 pm

      There is no “property tax” on vehicles where I live. Registration costs me the same regardless of how old the car is. Only plate type changes that. (IE: antique plates which have restrictions). All the state fees are the same flat fee or in the case of use/sales tax due upon registration. The only way out of that is to buy used from a family member, then it’s a flat $15 if I recall correctly. (Two of the three used cars I’ve bought were from family members)

    • April 17, 2013 at 4:31 pm

      Uhhhh, last I checked, $200 × 7 was more like $1400. I’m guessing that’s quite a lot less than twice the purchase price of your four-by-four, twelve years ago. :-)

      • DownshiftFast5to1
        April 17, 2013 at 5:25 pm

        Good catch, James. Yeesh, THAT IS some fucked up math on my part. Please pardon me. I have no worthy excuse for that error.

        [Note to self: no more pre-coffee posting or posting with less than four hours sleep.]

  30. BrentP
    April 16, 2013 at 3:14 am

    But let’s look at the downside of buying used, beyond just having something that should be essentially worry free for years. The used car takes a good long while to find if desired in any particular way. This labor and time has value. Then it will be a compromise of options, color, price, condition. Then there is the dreaded previous owner. They do weird stuff. Undoing what they did takes time and money too. Then there was what the previous owner didn’t do. Like clean, maintain, etc.

    I am not sure all that time is worth it for everyone. Time and money equations…

    It’s a choice and what comes out ahead is what a person wants. A new car is exactly the way I want it, it’s clean. It hasn’t been molested, etc and so on. That does mean something above and beyond book value.

    • April 16, 2013 at 9:55 am

      Hi Brent,

      Sometimes, buying new can be a stressful, time-consuming PITAS too! Just for instance, consider the paperwork involved – vs. a cash transaction for a used car. Unless you know the ins and outs, it is very easy to get screwed over during the paperwork process. But when you agree to buy a used car for say $5,500 – you hand the guy cash (or a bank check) he hands you the keys – and that’s it. No hidden fees or contract clauses. Etc.

      And one often does have to compromise when it comes to color, options and so on – unless you’re willing to order the car and wait for it.

      Which might take weeks.

      As far as worry-free: Not always. “little things” crop up fairly often with the brand-new cars I test drive every week. Usually, these are minor electrical system glitches – but still, something you’d (as the owner) have to take the car in for. It’d be warranty covered, of course. But they don’t pay you for your time, right?

      It is a choice – and there are pros (and cons) to both.

      • BrentP
        April 16, 2013 at 1:37 pm

        The electrical glitch my ’97 had when new cost me less time than any used car I’ve ever purchased.

        Transaction wise, if you avoid dealers, then you get to go to the SoS or DMV office and do all the paperwork yourself.

        I’ve ordered both my new cars. I can wait for things. I’m never in a big rush to buy something.

        If I could set my hours a used car wouldn’t be that big of a hassle. But driving an hour to go look at a car and finding out it’s no good and driving home gets to be a drag.

        (BTW: both new car purchases I’ve done were painless. The second was really easy. I just put out what I wanted out for bid essentially via the motor club and picked. Some dealerships really react well to someone who knows what they want. Others don’t. They want to sell what’s best for them. skip them if they can’t figure out what sure sale is.

        • Brandonjin
          April 17, 2013 at 12:52 am

          Brent,
          “If I could set my hours a used car wouldn’t be that big of a hassle. But driving an hour to go look at a car and finding out it’s no good and driving home gets to be a drag.”

          This is my issue as well. No good deals where I live, but the closer you get to a big city (where there’s more used car dealers/competition), the better the deals get. There’s only so many Saturdays you can waste though, before you give up on those “good” deals. Because they actually are not.

          • April 17, 2013 at 12:54 am

            Hi Brandon,

            Here’s my 50 – based on a lot of experience (good and bad):

            Whether you’re shopping new – or used – never, ever do it when you’re in a hurry. When you need a car right now. Or even tomorrow.

            Shop when you have time – and when it really doesn’t matter whether you buy today – or a month from now.

          • BrentP
            April 17, 2013 at 1:48 am

            I am in the big city… it just takes a long time to get anywhere ;)

            Another thing that makes it difficult for me is that I demand a manual transmission… which is probably what makes it most difficult. (hence why I have gotten used cars from family members, they are MTs)

    • Ed
      April 17, 2013 at 12:42 pm

      “The used car takes a good long while to find if desired in any particular way.”

      Late last year, I decided to buy a used PT Cruiser, period. I didn’t limit my search to a blue one with a black leather interior and four cigarette lighters, with blue shag carpet and an automatic moonroof. I made my search as broad as possible and turned up several possibilities within 15 minutes of searching Craigslist. The one I bought turned out to be a basically sound Limited Edition and I paid $1,000 for it.

      If I had turned the search into some kind of quest for the perfect car, I would probably still be searching after 4 months. To me, a car is a machine to use for transportation, not an accessory for making a fashion statement, nor for showing off my sophistication and concern for the environment.

      In my case, a car isn’t something to be desired in any particular way. That’s why used cars are fine with me.

      • April 17, 2013 at 1:41 pm

        Yep – that’s my approach, too.

        When I bought the ’02 truck, my only criteria were: manual transmission and the four cylinder engine. I wasn’t worried about the color – and I was willing to compromise on mileage and other factors if the truck was sound and the price was right.

      • Hot Rod
        April 17, 2013 at 11:39 pm

        I’m also a pragmatic person who could care less what others think. It helps when you’re parents were of the same mold. We had to get used to driving around in the oldest car as mom & dad drove us to the school yard. When you’re a kid you try to duck low so that kids can’t see you in the dented, rusted, old beater. But all that builds character. Drive an old car if you have kids, make them learn that material image isn’t necessarily worth the price. Later in life they will appreciate utilitarian value as well and gain a life long independence from their peers and Jones judgements alike.

        Rarely, can a man build wealth in his younger years by living big with a new car payment. That new car will remove him from profitable capital ventures, education, and/or spin him into the indebted servitiude, and that is the price for a child growing up expecting a new shiny vehicle in the parking lot. The behavior is often emulated in his youth. So its just another reason why to encourage used car ownership, as frugality can be inherited more likely than not.

        There there is the woman issue if you are single. Women love the smell of new cars, and yet that may very well attract the wrong kind of woman. My dear friend a very successful engineer always drove Porche’s and BMW’s to pick up his dates. He was a very kind, intelligent, and nice guy. He got empty, souless wretches of women who financially burned him in the ground. A nice used car will be a good test to see if a woman is a good gal. Heck show up in the driveway in a junker for the first date, I did it and I married the nicest, most generous and wisest woman to money ever. Would you rather have 10 rubies or the type of woman worth more? Used car please.

        And finally what BrentP said is still true. At some point in your life its likely that your opportunity cost will get so high that paying premiums for new cars is a much better investment than wasting your time on old cars. Nothing to fret there as that is a possible sign that your wise investing in yourself has yielded dividends. Its also a wise person that deduces where his best return in time is. But even then there is still a very good reason to buy a used car. Many years back in the L.A. riots my brother owned a junker parked in a lot where the hoodlums came through vandalized every vehicle except his. To him he was one of the downtrodden bros, and yet my brother lived in a mansion. Moral of the lesson is that new cars attract attention to yourself. Enjoy it if you like but understand that fame and popularity and even envy comes at a price of safety and anonymity of looking like a nobody.

        And finally the only downside to owning too old of a car, and I’m talking > 10years, is that cops make some of the worst Jones folks. Yeah they get to ride around in that shiny new mustang that they repossesed from a pot smoker or you paid for in either taxes or other forced tributes. But if your car looks too shabby and you’re in the Hamptons then you can expect to be treated as a dope carrying beaner at maximum and with disdain at minimum.

        There you go as Eric gave excellent tangible costs of buying a new car and I’ve just given the intangible costs.

        Regards,
        HR

        • April 18, 2013 at 12:06 am

          Dear HR,

          Excellent points.

          Leaving aside the dollars and cents aspect for the moment, the character related issues you list are dead on.

          The “beater test” is a good one.

          Also, the “Does she reach over to lift the driver’s side door lock button test” was a good one.

          Of course with remote door locks that is a fond relic of the past.

          • Hot Rod
            April 18, 2013 at 3:45 am

            Bevin,

            Old wisdom never dies, I like the suggestions you provided as well.

            Have a nice day.

            HR

    • April 18, 2013 at 5:12 am

      Went to see a used Mazda Miata in Long Island in 2003 or so. The car was in OK shape, apparently, and the price was reasonable, but there was something a little “off” about the seller, so I got the VIN and did a Carfax or similar. I discovered that the car had been registered and re-registered in PA 8 times in one day – obvious evidence the guy was attempting to “wash” the title. I passed. BTW, PA still has by far the loosest motor vehicle laws and administrative procedures regarding registering and titling cars, so much so that we New Jerseyans know to give a wide berth to what might be an unlicensed, uninsured driver…

  31. Tomas
    April 16, 2013 at 1:32 am

    Made the mistake of buying a new car, once. Since then, used all the way. So far 4 or the 5 have been bought under, some well under, kbb private party price. Patience and knowing what you want, and being willing to walk away from are big assets. Helps to know a bit about cars too.

    It’s pretty funny, younger types (30ish) look askance at my aging 13 yr old suburban (which runs and drives great, 178k miles), but the codgers, they get it.

    • Rooney
      April 18, 2013 at 6:27 pm

      “Helps to know a bit about cars too”

      I’ve noticed that most of the younger crowd won’t crawl under a vehicle to take a look at the drivetrain, exhaust, frame, suspension components, and the like. They tend to jump behind the wheel to check out the stereo first.

      • April 18, 2013 at 7:43 pm

        Yeah, I’ve noticed this also.

        Several factors probably at play, but one – I’d argue – is that kids today (in general) don’t have the money or the time to mess with cars the way my generation (Gen X) and older did. Their lives are much more hectic and scripted with “activities” – they don’t just hang out, like we did. And the money. In high school, I (and most of my friends, too) was able to afford a V-8 muscle car on a part-time fast food job & summer full-time work. Forget that, today. The typical HS kid is more likely to have a Civic or similar bought by mom & dad, which he adds a fart can to – and a loud stereo – and that’s the end of it.

  32. Mike R
    April 16, 2013 at 1:27 am

    This article probably made sense about 5 years ago, but in the past 5 years, used cars have commanded some big premiums. Especially since most used cars are now bought at auctions, by the dealers. The private market for used cars is between slim and none, and mostly its junk. if you have to go back 5 years just to get one at a “good price” you’re buying something that likely has close to 100k on it, and likely not well taken care of. Most people just do not want the hassle of selling their cars. So they trade them at a loss. Go to Autotrader, craigs list, wherever you want. Its 99% percent dealer sales. And they jack the prices up $5k to $6k on vehicles priced between $15k and $30k. They make tons more on used. THIS is the information dealers dont want you to know. Eric is just a shill for these folks, and obviously has done zero investigating as to the availability of vehicles from private sellers.

    • Tomas
      April 16, 2013 at 1:40 am

      Gotta reply, I bought two good used cars (for my son and wife) about a month ago. A bit older than Eric mentioned, but, a lightly used 2004 outlander w/ awd, and a loaded, pristine 2007 quest. Paid just under 20k total for both on the same day (sometimes it just works out like that). The last car I bought was a 2007 vw passat, the last day of cash for clunker (aka gm bailout/screw future used car buyers). Kbb was 17, bought it for 13, from a dealer. Sold it last month for 10,500 to the first guy who looked at it.so, there are in fact quality used cars at a reasonable price to be had, if you take the time to look (I looked for a few months online, drove the few promising ones). I’ve got a 98 maxima I need to unload to make room if you’re interested, only $1200!

      • Tomas
        April 16, 2013 at 1:42 am

        both were cash sales, which does tend to help with the price negotiations.

    • Ed
      April 16, 2013 at 2:18 am

      “Eric is just a shill for these folks, and obviously has done zero investigating as to the availability of vehicles from private sellers.”

      Nope, Eric doesn’t shill for anyone. I’ve been reading his articles for years and haven’t detected any such thing. Have you read anything he wrote besides this article?

      The last two used cars I bought were from private owners on Craigslist. I swap off between the two as daily drivers, and they have both been good cars.

      There are lots of private sellers on our local Craigslist and there are some deals to be had. It’s a matter of looking. Plenty of people would rather own a car outright than be enslaved by payments on a new car. I’m one of them, but I don’t even look at dealers’ inventories.

    • DownshiftFast5to1
      April 16, 2013 at 2:56 am

      “…craigs list, wherever you want. Its 99% percent dealer sales.”

      Really? How do you know this?
      It does not seem that way in my area, and I’ve been spending a significant amount of time looking at them for the last year or so.
      I’ve seen plenty of tempting deals in that time. I even bought one!
      YMMV I guess.

      I kind of wonder how you know this too: “Most people just do not want the hassle of selling their cars. So they trade them at a loss.”? Is that because everybody is rich these days and money is no object?

      The way I saw it, everybody and their grandmother were selling things online, so that’s all news to me.

      Anyway, I wonder if this same reasoning about buying new cars applies to new motorcycles as well?

      There certainly seems to be plenty of quality used motorcycles for sale in my area, but I wondered if the advantage was all that great for new?

    • Boothe
      April 16, 2013 at 4:00 am

      Gee Mike R, it sounds more like you’re the shill for new car dealers. There are still plenty of good used vehicles out there for sale by owner. You just have to get off your duff and go look.

      In this day and age due to superior technology and metallurgy, 100K miles on a car now is just broken in for many of us. And with respect to car dealers (new or used), they provide a service and are convenient. So you can expect to pay them, in the form of a profit, for risking their capital for your convenience. Otherwise there would be no dealers. It’s true that some dealers may even turn an obscene profit. But that’s just one of the hazards of a free market. Caveat emptor and you’re under no obligation to deal with the crooks.

      But 99% of the ads in Autotrader and Craigslist being dealers? Where’d you come up with that number? Anal extraction? I think we have another clover…

    • Tom
      April 16, 2013 at 6:18 am

      Not true. While it may vary by region, I test drove no less than 4 different cars on Craigslist in less than a week from private sellers.

      The private market for most makes of cars is alive and well here in the Pacific Northwest.

      I think I would trust Eric’s take on used car availability just from personal experience alone.

      • April 16, 2013 at 9:48 am

        Hi Tom,

        In my experience, the used car market is exactly like the new car market in that some makes/models are harder to find than others – and you’ll pay more (or less) for some vs. others. The same rules apply. Now, that said, the used car market has been distorted by the “cash for clunkers” program of a few years back, which drove up the prices of many used cars (compact trucks, for example). But there are still plenty of used vehicles out there – and many great deals to be found!

        • Tom
          April 16, 2013 at 5:15 pm

          I absolutely agree and with a little patience it’s often possibly to find a highly motivated seller who will deal in good faith.

          When I bought my Corolla the private seller I purchased from was moving overseas that weekend and had to have the car sold. I ended up offering him $500 more than the dealer offered which was still well below blue book by about $2200.

          I’ve had similar experiences with other cars and let me tell you, offering cash makes a huge difference.

    • April 16, 2013 at 9:59 am

      Mike,

      “The private market for used cars is between slim and none, and mostly its junk.”

      “Go to Autotrader, craigs list, wherever you want. Its 99% percent dealer sales.”

      Do you have any facts to support these claims – or are they just your opinion?

      Your comment about me being a shill made me chuckle, by the way. I suppose you missed the conversation that took place here about a week ago…?

      http://ericpetersautos.com/2013/03/26/for-your-amusement/

    • swamprat
      April 17, 2013 at 1:11 am

      Eric is a shill for no one. He would probably agree that the used car market has been distorted since cash for clunkers was briefly tried in 2009, however, new sticker prices have also shot up in the last 3 years or so, which pumps up the prices for all cars.

    • Chris
      April 17, 2013 at 12:06 pm

      Yes, it’s true that dealerships, and other dealers make more money on used vehicles, but that does not mean that YOU cannot find a good deal out there! What an idiotic argument!

      • Douglas
        April 18, 2013 at 12:12 am

        Like anything else, you don’t get what you deserve, you get what you negotiate. Research the vehicle and your means to afford it. As with all things negotiable, remember: If they accept your offer, you either asked too little or paid too much (Ferengi Rules of Acquisition)

    • ed davdidson
      July 30, 2013 at 12:11 pm

      1. It is true that used cars are at a premium, since they made so few since the Recession. This article seems 5 years late. I bought a great CPO car in 2004, with 10k miles and 100,000 warranty. But that was then. Good used cars often cost the same now as new, because they are so few.

      2. ?Who would want a car with 2 airbags instead of 6. If you are going to drive your car over 100,000 miles there is some chance that someone is going to hit your you are your kids. Cars maybe like “appliances”, but your Fridge is not going to maim you.

      • July 30, 2013 at 12:33 pm

        I’d like a car with no air bags.

        Unfortunately, we’re not “allowed” to buy them….

      • BrentP
        July 30, 2013 at 1:23 pm

        Anyone who uses the seatbelts may not want the airbags. Anyone of small stature as well. When it comes to US air bag standards nobody should want them. They are over powered. Safety devices shouldn’t cause injury/death.

        The unbelted male standard is the problem. ECE regs call for a power level to be in addition to a seat belt.

        Basically in the early 1970s the automakers developed and tried airbags as a substitute for seat belts. They learned the problems of them and they were eventually dropped. Then the Claybrookians and other safety nanny know-nothings cast the automakers as evil corporations that wanted people to die. The automakers presented their data and fought the airbag requirement, especially at the unbelted average sized male standard. They were evil bad corporations and eventually were defeated. The standard went in and people started getting killed by the airbags in minor collisions just as the automakers’ data said would happen. Government, unable to admit error now has the complex weight sensors and other nonsense to kill/injure fewer people with airbags but not admit their standard overpowers the airbags in the first place. They are still quite dangerous. The issue was just patched over.

      • July 30, 2013 at 1:53 pm

        2. ?Who would want a car with 2 airbags instead of 6.
        ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
        I would…and actually I prefer a car with 1 or 0 airbags. The problem with all the newer cars with 6+ airbags is that when you have a low-speed crash that just happens to set the airbags off, you are now looking at a much higher repair cost. A car that for all practical purposes is still driveable other than some cosmetic damage to the front end is now totalled because the cost to replace all those extra airbags is $6000 instead of $1500. Not to mention the re-certification fees that many states require when a car has been “totalled”. You might be able to get by driving the car in that condition for a while, but when annual inspection time rolls around you’ll find that they won’t allow the tag renewal without a functioning airbag system. That’s why you see so many cars with minor body damage written off as a total loss by insurance companies…because it’s just not worth spending $9000 to repair a car that was only worth $15k prior to the accident. And because insurance companies lose more money as a result of these gov’t mandates, they pass it along to people like you and me in the form of higher premiums.

        • July 30, 2013 at 3:54 pm

          Exactly, Turd!

          I’ve been ranting about this for years.

          The typical car sells for about $25k when new. After six or seven years, it’s worth about half that. Insurance writers will typically “total” any vehicle when the estimated repair costs approach 50 percent of the car’s pre-crash retail value. The cost to replace just the driver and passenger-side bags (which often involved replacing the dashboard and steering wheel, lots of trim, major labor, etc.) is in the range of $2,000 – depending on the make/model. That means if the car was worth about $5,000 or less pre-crash, it will be totaled, even if it’s otherwise drivable. Now multiply the cost of those bags by two – or three – and you can see that many cars with book values under $15,000 are in real danger of being declared “total loss” following a fairly minor wreck, as a result of the cost of the damn air bags.

  33. Brandonjin
    April 15, 2013 at 11:35 pm

    So, when a car is five years old, that’s the best time to buy? I’d love a 2008.

    If everyone followed this advice though, there’d become a negligible price difference between new and used. The more people buy used, the better deal a new car becomes.

    I think.

    • Douglas
      April 18, 2013 at 12:08 am

      As a rule, about three to four years. What you have to beware of are daily rentals and lease returns. The latter aren’t necessarily bad, but in all cases demand the CARFAX and service records. And, of course, look hard at the visible wear and tear and compare it with the stated mileage. Even with greater use of digital odometers, there STILL are ways to spin them back. A CARFAX report alone won’t necessarily screen out every ‘spinner’. And above all, NEVER, NEVER, NEVER, buy a car off a Russian or an Iranian, especially private parties or even a small used-car lot. They are infamous for having rings that recondition (barely) salvaged vehicles, spin the odometers, and switch VIN numbers to defeat detection. Just avoid the bastards altogether, they’ve royally fucked up their own countries, don’t let them do the same to us!

      • Brandonjin
        April 18, 2013 at 1:38 am

        Lol, good to know Douglas thanks. This is the land of opportunity after all.;)

  34. Tom
    April 15, 2013 at 10:13 pm

    Good article Eric

    Not every new car purchase is a losing proposition but I agree with you in terms of the piece of mind and the worry that you don’t have, a used car is most often a superior choice.

    A few years ago my wife and I bought a new 2008 Honda CRV for 21k and 2 years later turned around and sold it for $19,700 with about 19k miles on it. I remember with the new car always parking away from other people because I was worried about getting dings and dents in the new car. Given the choice I wouldn’t buy new again but driving a new car for 2 years for $2500 (don’t forget tax) isn’t a bad proposition. However when we moved from the CRV to a minivan we did buy a used one this time around for $7000, reserved $4k for potential repairs and put the rest into savings.

    My most recent purchase was a 2 year old Corolla on a private sale with 21k miles for about 2k under blue book. The Corolla is planned to be a long term car for the next 6-10 years at least. While I’d be upset to see a ding or dent in the newer Corolla it wouldn’t be the end of the world. I’m not sure I could say the same for a new car.

    Even in the used car market I think it pays to consider what the utility of the vehicle is. A few years ago I had about 5k set aside for a new pickup to replace my aging Dodge 1/2 ton with major electrical issues. I considered spending the entire 5k and buying something that was very nice and in almost perfect condition. I instead went for a bit older, carbureted truck I could work on that already had a few dings and some paint issues since it was going to be a utility truck. Now when I go out woodcutting and hear brush scraping the side of the truck I’m not worried. There is something to be said for an older vehicle that already has it’s share of battle scars as a utility rig.

  35. A. Crawford
    April 15, 2013 at 9:29 pm

    And is it such a bad idea if you keep the car for the 200,000 miles yourself? People mistreat their stuff…you don’t know what’s been done to that car. We have had our car since June 2000; it has about 182,000 miles on it. We have driven every mile ourselves, and have had few repair expenses. For somebody who has to have a new car every few years, I suppose your advice is good. I’m not so sure if it’s as good if you plan to drive it until it falls apart.

    • Joyce
      April 17, 2013 at 3:16 pm

      I’ve got you beat.. I can pay cash for a new car.. but hey… who needs a new car when my l983 Toyoto with 122,000 on it runs just like new.. besides oil changes, tires and batteries, the only thing I’ve had to replace is the air conditioner fan which fluked out early in’84. I love my Toyo!

  36. Boothe
    April 15, 2013 at 9:07 pm

    Eric, I admit that I bought my Ex two new cars (women will sometimes inspire a young man do stupid things). But I’ve never really owned one myself. I came close with an ’87 Toyota 4X4 pick-up. But it had 4K on the ticker when the kid that “signed” for it lost his job and turned it in to the dealer. A mere 4000 miles devalued that truck 25% in less than 6 months. And that was after he’d installed chrome wheels, big tires, a nice stereo and a bed liner! Some investment, huh? My parents advised me many years ago that a car is “used” as soon as you drive it off the lot.

  37. Mithrandir
    April 15, 2013 at 8:05 pm

    Eric,

    I have one scenario in favor of buying a new car.

    If you buy the car new with the intention of keeping it until it is no longer viable to keep. (I am thinking over 10 years and/or 250,000 miles)

    While not as economical as buying a used car (3-5 yrs old) at least you know how well the car was maintained from day one.

    Sometimes, even if one is knowledgeable about cars, it is possible to miss something important (about the used car) that can be costly later.

    • honestann
      April 16, 2013 at 10:14 pm

      I totally agree. However, that’s because I always pay cash. My opinion is, nobody should buy a car newer than they can afford to pay cash. Stick with that simple rule, and you’ll do well. No loans, period. If that means a 5-year old car with low-miles from some little old lady, fine. If that means a brand new Honday, fine. If that means a 2013 Ferrari, fine. Just don’t buy what you can’t pay for.

      My personal rule of thumb is this. Don’t buy a car that costs more than 5% of the value of the physical gold I have stashed away in the desert. Live frugal, stay frugal, enjoy life, no pressures. I do admit I pushed that personal rule to 10% last year when I bought my brand new, high-tech, flat-panel cockpit, GPS, autopilot airplane (300kph, 75mpg, 4000km+ range, < 80m take-off roll). But that's my once in a lifetime treat.

      • Just Dont Get In My Way
        April 17, 2013 at 7:20 am

        OK. I’ll bite. What kind of airplane can meet all those specs? What did you buy?

        • April 17, 2013 at 12:27 pm

          Never mind that, where in the desert?

          • Boothe
            April 17, 2013 at 2:39 pm

            P.M., I’m guessing it’s buried in the same desert and about 100 yards out from his secure observation post with optional rifle rest.

          • honestann
            April 22, 2013 at 4:30 am

            Where you’ll never find it.

            Actually, you’ll never even figure out which country to look in. Sorry. Not.

        • honestann
          April 22, 2013 at 4:29 am

          My pipistrel virus SW with the new rotax 912iS engine.

    • Strder55
      April 17, 2013 at 6:12 am

      If the previous owner had maintenance work done at a dealership, the Carfax report will show it. And you can see those reports for most cars free on the Cars.com site.

    • Douglas
      April 17, 2013 at 1:54 pm

      Eric, some twenty years ago or so, I’d have wholeheartedly agreed with this advice to buy “nearly new” (a lease return that was nevertheless adequately maintained and driven by a calm individual was perfect). This was the advice of the late Charles Givens in his “Financial Self-Defense” articles. If you were reasonably astute automotive-wise, you could do some simple repairs (alternator, starter, water pump, transmission flush and filter replacement) that would likely need doing in the 50,000 to 100,000 mile range. A trip to the auto parts store, relatively modest part cost (compare it to your ‘friendly’ mechanic’s charge for same and you’d realize how you’d been gouged not only on ‘labor’ quoted at a manual flat rate rather than the actual time, usually half, but also the typical 100% or more parts markup), maybe an hour twisting wrenches and skinning knuckles, and you’re back to happy motoring. But with almost anything put out in the 21st century, you take one look with the mill buried under a shroud that you have to drill out the fasteners to remove, and you realize that virtually ALL manufacturers have gone out of their respective ways to defeat any attempts to DIY. Of course, they can and have to a great extent shut off the aftermarket parts pipeline.
      So, IF you’re willing to commit to the vehicle and drive it to the point of unfeasible repair (how feasible will depend on how much you’re able to screw with it, not necessarily how repairable it is), then buying new makes sense. Of course, you have the privilege of paying the tax feeders for being “rich” enough to afford a new car, so they’ve all got their hands out for higher insurance, sales tax, vehicle license fees, property taxes, etc. As an example, the VLF on my 2011 Ford Fusion has INCREASED each year even though the car is aging…that’s thanks to the liberal morons in the “Golden Fleecing” state that have no problem with raising taxes b/c they figure SOMEONE ELSE will pay!

      • April 17, 2013 at 2:04 pm

        Hi Doug,

        Some new cars are (much) better than others when it comes to basic maintenance and repair. For example, I recently did an oil change on a new (2012) Subaru. I was pleasantly surprised to find the oil filter mounted in a very accessible place, directly under the engine, with the exhaust piping carefully routed around it. Changing the oil/filter is an almost no-tool job.

        Alternators and other accessories are – depending on the make/model – sometimes very easy to get at and sometimes extremely difficult to get at. This dynamic was true 20 years ago, too.

        The thing is this: If you are a DIY kind of guy, it’s a smart move to take a good look at a prospect before you buy it. Read up on service/maintenance issues – etc.

        • Douglas
          April 17, 2013 at 11:58 pm

          Serviceability IS a factor whether buying new or used(up). Either it’s just ignorance on the part of Detroit’s finest engineers (the ’75 Chevy Monza with the gutless 262 CID V8 that you had to loosen the engine mounts and jack up the engine to service the rearmost spark plugs comes to mind) or else they truly are, by virtue of undue complication and restricting parts availability, defeated the DIY ability to keep the old iron running.
          In keeping combat vehicles going, this is literally a matter of life and death. Throw whatever rocks you can at the M1 Abrams…it’s ungodly expensive, heavy (72 tons tons with the latest TUSK upgrade when combat-loaded), drinks hellacious quantities of fuel (each tank on the march to Baghdad in 2003 required over 10,000 gallons APIECE), BUT…the powerpack can be swapped out by a field crew with an ARV in two hours. Likewise the Sherman in WWII could be powered by an adaptation of a Wright radial aircraft engine, a Ford V8 (precursor of the MEL series), two GM 6-71 two-stroke diesels (both the Brits and the Russkies thought them superior to the home-grown product), or even a clusterfuck amalgamation of five Mopar flathead-sixes (the A57 Multibank, and surprise, surprise, it was actually quite reliable!). It’s not a question of ability, it’s ignorance on the part of the American motoring public that tolerates this bullshit inflicted on them by an unholy alliance of the Federal Government (including esp. the EPA!), the automakers (and Toyota, Honda, Nissan, Mercedes and VW are just as much in bed as the “Big Three”), and the insurance companies. I’d rather be like Dennis Leary’s character from “Demolition Man” with regard to my rides:

          In the meantime, I’ll persist with my oil burner, the old Beetle, an old Dodge Power Wagon with the big flathead six, and stick it to the “man” (or should I say collection of wimps!)

      • Chris
        April 17, 2013 at 2:26 pm

        I don’t really agree with this. It’s still basically true that you can take apart just about any Japanese car with a 10,12,14,17,and 19mm wrench. Very little special tools are needed when dealing with Japanese vehicles. Volkswagen, on the other hand, is a whole different story. IMO, vehicles have gotten easier to work on with the almost total elimination of vacuum lines, and such.

        Also, as a professional wrench twister, you’re not only paying for my labor; you’re paying for the thousands and thousands of dollars I have wrapped up in tools, and education. It’s not what we do, it’s what we know how to do, and having the tools to get the job done. Most people don’t even own a simple craftsman socket set, but they get upset when they’re charged what they perceive to be too much. They don’t take into account that the mechanic — who doesn’t make that much anyway — has to buy their own tools to fix your car. Further, it’s not the mechanic’s fault that they have gotten so skillful at their trade that they are able to beat the quoted labor time. There’s alse another side to that story, where the green mechanics take MUCH longer to get the job done. Would you be happy paying more???? If we implemented your idea, I would just have my slower mechanics work on all of the cars, dramatically increasing the labor time and cost.

        • Bill
          April 17, 2013 at 5:54 pm

          Excellent point.

          • arji
            May 4, 2013 at 8:17 am

            Still a scam. When I work on computers, I charge them for the time it takes me to repair and parts. There is no arbitrary minimum fee except maybe mileage if the customer is more than 25 miles away. That is fair. Charging the way mechanics do is plain and simple a rip off. Paying for the exact time it took to effect repairs is truly the fairest way to charge. It doesn’t matter how skilled the person is. The minimum charges should be a guideline so the customer knows the max he will have to pay.

        • BrentP
          April 17, 2013 at 9:40 pm

          The Mazdas I’ve worked require several wrenches for a simple job but when going beyond simple also need a variety of special tools. Usually something I have that is close enough or something I can make or something I can live without doing things a more difficult way, but special is there none the less. Of what I’ve read of the other makes there isn’t much difference.

          Now my ’73 Ford…. that I could take apart with just a couple wrenches.

        • Douglas
          April 18, 2013 at 12:03 am

          The mechanic that actually performs the work is seldom the problem. Hell, I’ve hired them on a moonlighting basis to come over, with me buying the parts, and both made out well. A necessary thing when keeping an old MB alive…even the local aftermarket garage charged $150/hour for its shop rate and gouges like an MFer. Don’t even ask about taking it to the dealer!
          I avoid most repair garages like the plague once they started using those goddammed “service writers”. I’d say most of these parasites are nothing more than salesmen cleverly trained on how to fuck the customer over. I can’t even begin to describe some of the bullshit I’ve seen them do to others, and their utter shock when they realized that I was perfectly knowledgeable about my car and its issues.

        • dan
          May 18, 2013 at 1:52 pm

          Re: Rates
          Don’t forget that it’s an average time estimate…sometimes things go well for the mechanic,and sometimes a bolt freezes in the aluminium and you end up accessing and tapping/heli- coiling for twice the estimate
          not to mention plastic crap that breaks and needs replaced on the mechanics dime.

    • MPO
      April 17, 2013 at 11:40 pm

      This is a moronic analysis. Car ouchases aren’t “investments”, are TVs a good investment? Cell phones? Boats? Wives?
      That this kind of of idiotic, inane crap gets linked to Lew Rockwell,com is why the left easily marginalizes us. We deserve it frankly.

      • April 18, 2013 at 12:50 pm

        MPO,

        What’s your complaint, exactly? The fact is many people do consider a new car an “investment” – and the article explains why this is not so. Many people are not particularly knowledgeable about the car business, vehicle ownership – and so forth. This is not to disparage them. We all have our areas of particular interest and expertise. This site contains both gearhead-oriented stuff that assumes a fair amount of technical and experiential knowledge – as well as general stuff written for the non-gearhead. Make sense?
        As far as the left marginalizing us (I assume you mean Libertarian-anarchist types) I’m as or more worried about the right marginalizing us!

        • Rooney
          April 18, 2013 at 6:00 pm

          Didn’t the mainstream repubs do just that at their so-called “National Conventional Ho-Down-the-fix-is-in-sunday-prayer-meeting.” from last year?

Leave a Reply

Your email address will not be published. Required fields are marked *