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| raspberry24 |
 Posted: Sat May 21, 2005 6:16 pm Post subject: Cars |
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Member of the Month
May
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Cars
"Never buy a completely new car. You can save thousands of dollars buying a rental car that hat has only been used one year. Buy one with 5,000 or less miles on it. These cars usually have been well maintained and serviced. You can also buy them from Dealerships. Also, plan your buying for the end of the year, when the new models are in. Your car will be considered a year older, and priced less."
http://www.allthingsfrugal.com/saving.htm |
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| Dave Rathbun |
| Posted: Sun May 22, 2005 2:22 pm Post subject: |
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CFO
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Have you ever rented a car? Do you treat it like your own car? 
I think I posted on this once before... I purchase new cars and keep them for 10 years. At that point the extra depreciation on the front-end is more than made up for by the longevity on the back end. Would you be able to get the same longevity out of a former rental car? Sure, you might. But by buying new, I ensure that the car is driven the way I would drive it from day one. It has been broken in properly, serviced appropriately, and babied when necessary. 
The money I save by driving my car for 10 years allows me to save up the cash I need to purchase the next car. Ten years from now.  |
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| freeye |
| Posted: Thu May 26, 2005 8:17 am Post subject: |
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Investing Manager
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i researched the new car versus used car subject in the past and found you can come out financially about the same as long as you keep the car for 10 years or more.
i believe it was paying cash for each car.
at the time i came down on the used car side since it allowed me the opportunity to change cars more frequently and to take advantage of the new safety features present in the newer cars... like side door air bags, ABS brakes and all wheel drive. in the cars i was interested in etc.
i may have to revist this subject as the hybrid cars come online and i look at the value of 10+ years of gasoline purchases vs hybrid battery replacements.
for me there is no one right answer for everyone, its an individual ongoing process of evaluating available cars and personal value judgements. |
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| Dave Rathbun |
| Posted: Thu May 26, 2005 11:42 am Post subject: |
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CFO
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Hybrid cars are - for the moment - a nice idea that is not really cost effective. If you count the ecological value of less polution (in some cases, hybrid cars actually put out cleaner air than what they take in  ) then there is some value. But as far as hard $$$ you really have to look at the numbers.
Big trucks (full size pickups, not big rigs) are expected to come out in hybrid versions in the coming years. There will be a $3K-4K premium, and only a 10% increase in fuel economy. Let's assume that you drive 25K miles a year, and keep the truck for 150K miles. Assume that gas is $2 a gallon, and that you get 17 miles per gallon with a standard V8. Trust me, that's being very generous. That means in 150K miles you'll burn 8823.5 gallons of gas for a cost of $17,647. How about the hybrid?
You get 10% better fuel economy, so instead of 17 you get 18.7 MPG. 150K miles later, you've burned 8021.4 gallons of gas, a cost of $16,043 dollars. With the hybrid you have paid $3,000 extra up front and over five years saved $1,604 in fuel costs.
If you had saved the $3K premium paid for the hybrid truck and invested it at 3% you would have saved twice that amount just by putting the money in the bank. Granted this is assuming that the cost of gasoline doesn't go up... how expensive would gasoline have to be before the hybrid would break even? According to my calculations, gasoline would have to average 3.75 per gallon over the next five years in order to just break even on the $3K premium for a hybrid truck.
I'm not down on hybrids (and I realize I'm hijacking this topic ). But in looking at savings in one area it's important not to neglect or ignore costs in another area. |
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| freeye |
| Posted: Thu May 26, 2005 3:16 pm Post subject: |
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Investing Manager
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for me there is no one right answer for everyone, it's an individual ongoing process of evaluating available cars and personal value judgements.
if i'm following you right the 10% you using in your calculation is a mixture of in-town driving and out-of-town driving.
this may mean if you live within battery range of work, shopping & entertainment that your gasoline engine may not come on at all during the course of many peoples week. assuming an obligatory plug-in for a recharge each night. in which case the 10% number may edge up accordingly.
i concede for many people this will be unworkable, but for those fortunate or thoughtful enough to live in close to the things they require for a good life at least now they may have another option to chose from.
for those with long commutes free of stop-and-go traffic or out on the open highway this may well prove to be unworkable.
there is an author you may find interesting by the name of PETER HUBER that discusses the hybrid technology and another technology we haven't even discussed that is even better than hybrid.
one title is BOTTOMLESS WELL and the other title is HARD GREEN. he was on c-span not long ago. i found his take on things quite unique, worth knowing about i should think.
i enjoyed your previous post. thanks for taking the time. |
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| Dave Rathbun |
| Posted: Thu May 26, 2005 5:23 pm Post subject: |
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CFO
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| freeye wrote: | | for me there is no one right answer for everyone, it's an individual ongoing process of evaluating available cars and personal value judgements. |
Absolutely!
| Quote: | | this may mean if you live within battery range of work, shopping & entertainment that your gasoline engine may not come on at all during the course of many peoples week. assuming an obligatory plug-in for a recharge each night. in which case the 10% number may edge up accordingly. |
Ummm, hybrids don't plug in. A hybrid is a combination of gas / electric motor. You use the gasoline engine for driving and recharging the batteries. The electric motor kicks in for extra "boost" during accelleration. The gasoline engine shuts off when stopped. The batteries - according to a study by Toyota - will last the lifetime of the car with no replacements required. Here's one site that details hybrid technology quite well... as you might expect from the domain name.
http://www.hybridcars.com/basics.html
Here's a review of GM's hybrid full-sized trucks:
http://www.canadiandriver.com/articles/pw/05gmhybrid.htm
Note: in that article the hybrid package is a $3500 upgrade but is projected to gain 15% in fuel economy. There are other cool benefits to the technology as well... the truck can act as a mobile generator. Since, well, it is a generator on wheels. They put some outlets in the truck and you can run anything you want off of the engine power. They used some of these in Florida during the last hurricane "recovery" season, as there were many areas that were without power for days and weeks, and why haul a generator when you can drive one and use it to carry water and other needed supplies? 
Link to story
The bottom line is that there are advantages to owning a hybrid truck. Just don't expect fuel savings to pay for the cost of the "upgrade", at least not during the first few years of availability. It's expected that within five years you won't be able to buy a non-hybrid truck as manufacturers try to make the government mandates for fuel economy, not to mention deal with ever rising fuel costs. |
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| freeye |
| Posted: Fri May 27, 2005 2:32 pm Post subject: |
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Investing Manager
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thanks for the heads-up on the hybrid technology and the links D.R.!
... like my orginal post said "i'll have to revist this subject", since i hadn't fully looked into the whole hybrid technolgy.
my understanding was the electric motor operated around town and the gasoline engine kicks-in as a needed boost; also like when the battery charge gets low.
i do recall learning something about battery replacement after 5 years...
possibly battery technology has finally made some much needed advances after having languished for many decades.
toyotas a good company and they aren't likely to be selling cars based on
their own study indicating no battery replacement will be needed unless it is true.
it only stands to reason that it would be cheaper to recharge your battery at least partially by plugging it in with gas over $2 a gallon, at least as an option for those customers that may be interested.
guess it may be more attractive to a larger share of potential buyers if the dealers can say never needs to be plugged in.
thanks again D.R. for the info. really enjoyed your post! |
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| raspberry24 |
| Posted: Sun May 29, 2005 5:31 am Post subject: |
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Member of the Month
May
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| I bought my Malibu when it was 2 years old. It is a 99. I haven't had do much work at all on it. I am hoping it will last 10 years. As well as my car runs and the for the price I paid... I would not buy a new car if I had to do it over. THis has been my only car. Some people are constantly trading theirs in and I think they loose a lot of money that way. |
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| zerolikedis |
| Posted: Wed Jun 22, 2005 3:19 am Post subject: |
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Investing Manager
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| well i wont buy a hybrid until they make it with a diesel engine instead of gasoline. nobody likes diesel because the engine sound at idle is " unbearable" but if you had the electric motor going then you wouldnt hear it ? by the way i mean clean burning diesel fuels . http://www.edmunds.com/new/2005/mercedesbenz/eclass/100396936/specs.html look at the benz imagine adding an electric to that car |
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| jumbojack |
| Posted: Wed Jun 22, 2005 6:10 am Post subject: |
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Investing Sr. Associate
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i don't know how many mpgs this mercedes pullman will give you and i doubt they'll ever make an electric model, but just being inside one will make anyone happy - even if you're just the chauffeur
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| chahsiubow |
| Posted: Thu Jun 23, 2005 7:37 am Post subject: |
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Investing Sr. Associate
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I dunno if I would trust a rental car. I'd think that people would 'test' out their new cars by redlining it or abusing it if they bought full coverage. I wouldn't think I'd buy a new car since I'd  the first day I see a scratch, but if I would, I'd go for the Accord Hybrid. |
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