Author Topic: New vs. used car - where has my math failed me?  (Read 2596 times)

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
New vs. used car - where has my math failed me?
« on: May 24, 2021, 09:43:59 AM »
This should be an easy one, right? I know the theory, and I'm familiar with all those fancy colorful graphs depicting the massive 25-30% depreciation of new cars in the first two years of ownership. However, this doesn't seem to reflect what I am seeing out there, and my maths tell me that I might be either better off or at least not any worse off with a brand-new car rather than a used one. And since I can't really believe this to be true I'm asking the swarm: where have I gone wrong? Please keep in mind that I did not take financing, average ARP new vs. used, stock market returns, etc. into consideration as that would open a whole new can of worms. The following prices are thus cash only.

Here are the basic premises of my calculations and some background. Five years ago I purchased a used 2006 Kia Sedona minivan that has now reached the point where it might no longer be financially sound to fix. The airbag light is on, the A/C has once again stopped working properly, and the TPMS system is wonky and flashes a warning light every now and then. I don't really care about the TPMS as I am perfecty capable of inspecting my tires regularly but the defunct airbag will keep me from passing the safety inspection and a working A/C is absolutely crucial here in Central Texas. This isn't a case of mildly uncomfortable, it can be life or death. Quite literally, especially with a 2-year old in the car. I no longer need a minivan but will require something that will be comfortable on long trips with the family, and my wife insist on driving something where she sits higher up than in a regular sedan (can't blame her with all those overcompensating flashy pickups and giant 7-seater SUVs around) as she simply doesn't feel comfortable and safe in a regular car. I was therefore thinking small SUV, aka Toyota RAV4, Kia Sportage, or Honda C-RV. Brand-new and with titles, taxes, and registration these go for around $25k-$36k depending on trim level. Given average assumed depreciation of say 25% over the first two years I would expect used 2019 models to go for between $19k-$27k. Yet the prices I see online by both private and commercial sellers (I've checked and compared Autotrader, Carmax, Carvana, and Craigslist) are in many cases barely any lower than brand-new ones and in some rare cases even higher. I have to go back at least 5 years and 50k miles to notice a sizeable difference in asking price that would amount to the 25-30% depreciation I would have expected of 2-year old models.

And here's where my brain starts spinning wildly out of control. Based on the cheapest currently available 5-year old Toyota RAV4, Honda CR-V, or Kia Sportage with less than 60k miles within a 200 mile radius the depreciation for these cars after 5 years seems to average at between $10,000 and $12,000. Go back another 5 years and they seem to lose another $10k in value. Coincidentally, that is pretty much exactly what my current minivan has cost me in total over the last five years including repairs: $8,500 purchase price + $4,300 in repairs - $1,500 residual value = $11,300.

In other words: if I buy a brand-new car it will lose around $10,000 over the next 5 years. If I buy a 5-year old car it will lose around $10,000 over the next five years. If I buy a 10-year old car it will lose me around $10,000 over the next five years.

Clearly, my brain took a wrong turn somewhere but I cannot figure out where and how. Any help?

nereo

  • Senior Mustachian
  • ********
  • Posts: 14921
  • Location: Just south of Canada
    • Here's how you can support science today:
Re: New vs. used car - where has my math failed me?
« Reply #1 on: May 24, 2021, 09:53:33 AM »
Car prices right now are completely wonky. There's an acute shortage of both used and new cars. New car production went way down and is being further exacerbated by a chip shortage.  Consequentially functional used cars have become a hot commodity.

I suspect your calculations are not coming out they way they normally would because you are using **current** prices for a 5 and 10 year old vehicle against both new and the what you paid for your vehicle several years ago.

I do not expect these discrepancies to last beyond next year as supply will (at least in theory) increase.  But that's just my cloudy crystal ball and basic economic concepts at play.

RWD

  • Magnum Stache
  • ******
  • Posts: 4917
  • Location: Mississippi
Re: New vs. used car - where has my math failed me?
« Reply #2 on: May 24, 2021, 10:05:32 AM »
I agree with nereo that the primary factor here is probably the unusually high used car prices right now. I did notice that your new car price(s) includes taxes/registration but you appear to be comparing to online listed prices for used cars which usually don't include taxes/registration/fees. Though this probably makes used cars look even worse in comparison!

Morning Glory

  • Magnum Stache
  • ******
  • Posts: 2710
  • Location: The Garden Path
Re: New vs. used car - where has my math failed me?
« Reply #3 on: May 24, 2021, 10:08:07 AM »
It is a strange time right now, and used cars are selling at inflated prices everywhere. It was the ac going out that finally pushed us to get a new one.

 We ended up buying a five year old Forester for a bit less than $15k ($16k after tax). They were closer to $20k in my town for similar year/miles so I saved quite a bit by driving to the big city. I also got one with previous body damage and a salvage title, which made the price cheaper. We could have gotten an older/higher miles one even cheaper but the depreciation is pretty linear after the first couple years and salvage hit and I really hate car shopping.

In my state, licensing a new car starts at $500 then drops each year, more steeply at first, bottoming out at $50/ ten years old. Five years old is $160 for the first year. There is a steeper sales tax on new cars than used too.

You will also be tempted to carry more insurance if you have a more expensive vehicle, which adds to your yearly cost. I did the math and the extra insurance would eat up the spread from financing too.

The other thing is if we are going new then we might as well go electric and it would take a year of planning to get enough tax liability to get the nonrefundable credit lol.

No safety or emissions inspections here, so that's not a concern.

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #4 on: May 24, 2021, 10:39:17 AM »
I heard about the shortage of new cars  but I wasn't aware that there actually was a used-car shortage as well. One of the more obnoxious local dealerships keeps running a radio ad where they claim a used-car shortage, and that thay will beat any Carmax offer by $500, but they claim all kinds of things and run very shady ads so I never took them particularly seriously.

Thanks for the input. Appears that it's not my math that is wonky, it's the market due to inflated used-car prices. Worst possible time to be buying a car then I guess, or as James May would say: C..k! Unfortunately, I doubt that I will be able to keep the Sedona running for another year or two. With the airbags, the A/C, and the TPMS system out there is no way I will pass the safety inspection due by the end of June (or survive the Texas summer) and I fear that fixing these issues will be too costly. I am going to drop the car off at a trustworthy mechanic later today and find out.

So what would you guys (and gals) do in my situation? I can wait until maybe mid July before pulling the trigger, which is when my wife is scheduled to return to the office full-time again and we absolutely will need a second car again. I doubt it will make a big difference either way to wait, right? Based on reliability reports (@RWD, the links in your signature are gold!) and some research I have narrowed in on Honda CR-V models 2017 and newer, either EX or EX-L trim since those come with CarPlay by default and seem to be incredibly reliable and fuel efficient overall.

JLee

  • Walrus Stache
  • *******
  • Posts: 6724
Re: New vs. used car - where has my math failed me?
« Reply #5 on: May 24, 2021, 10:48:53 AM »
Cars are up about 26% YoY - Cargurus has some fun data if you want to look at anything specific: https://www.cargurus.com/Cars/price-trends/

secondcor521

  • Magnum Stache
  • ******
  • Posts: 3851
  • Age: 52
  • Location: Boise, Idaho
  • Big cattle, no hat.
    • Age of Eon - Overwatch player videos
Re: New vs. used car - where has my math failed me?
« Reply #6 on: May 24, 2021, 11:03:28 AM »
I didn't go through all your math, but a few things stuck out:

You're ignoring repair costs on the new vehicles.  Maybe true, maybe not.

Toyotas and Hondas depreciate more slowly in the first five years than other brands.  And I'm not sure but probably a lot less than Kias.

RWD

  • Magnum Stache
  • ******
  • Posts: 4917
  • Location: Mississippi
Re: New vs. used car - where has my math failed me?
« Reply #7 on: May 24, 2021, 11:10:59 AM »
So what would you guys (and gals) do in my situation?
It's a bit spendier but you could also consider a new RAV4 Prime. In hybrid mode it gets 31% better fuel economy than the CR-V and has the ability to drive purely on battery. With Federal incentives a new RAV4 Prime probably $7k more than a 4-year old used CR-V but over the lifetime of the vehicle the fuel savings would eventually offset this. The RAV4 Prime also has 302 hp compared to the CR-V's measly 190 hp.

(@RWD, the links in your signature are gold!)
I'm glad those are still useful three years later!

Paper Chaser

  • Pencil Stache
  • ****
  • Posts: 742
Re: New vs. used car - where has my math failed me?
« Reply #8 on: May 24, 2021, 11:12:18 AM »
So what would you guys (and gals) do in my situation? I can wait until maybe mid July before pulling the trigger, which is when my wife is scheduled to return to the office full-time again and we absolutely will need a second car again. I doubt it will make a big difference either way to wait, right? Based on reliability reports (@RWD, the links in your signature are gold!) and some research I have narrowed in on Honda CR-V models 2017 and newer, either EX or EX-L trim since those come with CarPlay by default and seem to be incredibly reliable and fuel efficient overall.

The price difference between new and used doesn't make buying gently used much of a better deal in most cases. If you're going to be stuck buying something in the next few months, I'd consider buying new if you can find what you're looking for on a lot somewhere (use the internet obviously). Saying that, I'd be looking hard for the cheapest Rav4 Prime you can get your hands on. You might even qualify for some tax breaks. It will have strong resale/minimal depreciation, reduced maintenance costs, and terrific fuel economy.

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #9 on: May 24, 2021, 12:52:45 PM »
You're ignoring repair costs on the new vehicles.  Maybe true, maybe not.
Yes, that's correct. I did ignore those for the first five years because new cars come with extensive warranties that cover pretty much everything. I don't expect to have any repair costs on a brand-new car during the warranty period, only the usual service costs that I would have with every vehicle, new or used.

Re: RAV4 Prime: I looked into hybrids and electric cars as well but quite frankly I don't see how it would ever pay off. I don't drive nearly enough to justify either an electric or hybrid, and with gas prices as low as they are in Texas (currently paying less than $2.50 per gallon, which is actually pretty high and usually more around $2.20) it's simply not worth it. In other words: at $2.50 per gallon and 25mpg $7,000 would cover my entire fuel budget for the first 70k miles or more, which would be around 10 years of ownership.

I will still keep my eyes open and see if I can find a good deal on one. I dropped off the Sedona a few minutes ago for diagnosis and am now hoping for the best. And I agree, the price difference between new and gently used simply doesn't justify the latter right now. In many if not most cases I'd be paying the same or more for a used car than a new one. I'm glad that I am not the only one who came to that conclusion as I was seriously doubting my abilities to do simple math.

JLee

  • Walrus Stache
  • *******
  • Posts: 6724
Re: New vs. used car - where has my math failed me?
« Reply #10 on: May 24, 2021, 01:00:11 PM »
You're ignoring repair costs on the new vehicles.  Maybe true, maybe not.
Yes, that's correct. I did ignore those for the first five years because new cars come with extensive warranties that cover pretty much everything. I don't expect to have any repair costs on a brand-new car during the warranty period, only the usual service costs that I would have with every vehicle, new or used.

Re: RAV4 Prime: I looked into hybrids and electric cars as well but quite frankly I don't see how it would ever pay off. I don't drive nearly enough to justify either an electric or hybrid, and with gas prices as low as they are in Texas (currently paying less than $2.50 per gallon, which is actually pretty high and usually more around $2.20) it's simply not worth it. In other words: at $2.50 per gallon and 25mpg $7,000 would cover my entire fuel budget for the first 70k miles or more, which would be around 10 years of ownership.

I will still keep my eyes open and see if I can find a good deal on one. I dropped off the Sedona a few minutes ago for diagnosis and am now hoping for the best. And I agree, the price difference between new and gently used simply doesn't justify the latter right now. In many if not most cases I'd be paying the same or more for a used car than a new one. I'm glad that I am not the only one who came to that conclusion as I was seriously doubting my abilities to do simple math.

EVs would save you oil changes and most other scheduled maintenance (generally a battery coolant flush every 150k miles, that's about it) down the road, but for the first 3 years a new ICE car shouldn't need anything but oil changes.

StashingAway

  • Pencil Stache
  • ****
  • Posts: 548
Re: New vs. used car - where has my math failed me?
« Reply #11 on: May 24, 2021, 01:11:55 PM »

It's a bit spendier but you could also consider a new RAV4 Prime. In hybrid mode it gets 31% better fuel economy than the CR-V and has the ability to drive purely on battery. With Federal incentives a new RAV4 Prime probably $7k more than a 4-year old used CR-V but over the lifetime of the vehicle the fuel savings would eventually offset this. The RAV4 Prime also has 302 hp compared to the CR-V's measly 190 hp.


Or save $10K snd get a Rav4 Hybrid... which happens to get better MPG

RWD

  • Magnum Stache
  • ******
  • Posts: 4917
  • Location: Mississippi
Re: New vs. used car - where has my math failed me?
« Reply #12 on: May 24, 2021, 02:00:26 PM »

It's a bit spendier but you could also consider a new RAV4 Prime. In hybrid mode it gets 31% better fuel economy than the CR-V and has the ability to drive purely on battery. With Federal incentives a new RAV4 Prime probably $7k more than a 4-year old used CR-V but over the lifetime of the vehicle the fuel savings would eventually offset this. The RAV4 Prime also has 302 hp compared to the CR-V's measly 190 hp.


Or save $10K snd get a Rav4 Hybrid... which happens to get better MPG

The regular hybrid doesn't qualify for the $7.5k federal incentive, so the price difference isn't very much. It also only has 219 hp instead of 302 hp. And you don't get the benefit of being able to do most your city driving on battery only. The 2016-2018 RAV4 Hybrid can be had cheaper, of course, but the fuel economy benefit compared to the CR-V is much smaller (10% vs 38%).

Morning Glory

  • Magnum Stache
  • ******
  • Posts: 2710
  • Location: The Garden Path
Re: New vs. used car - where has my math failed me?
« Reply #13 on: May 24, 2021, 02:13:09 PM »
Are sales tax and registration the same for new vs used in Texas?

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #14 on: May 24, 2021, 02:34:23 PM »
Taxes are, yes. 6.25% on both new and used cars. Registration fee is pretty low, somewhere around $50 or so per vehicle and it's generally the same for both used and new. The only difference I think is that for new you have to pay for a new license plate whereas used you have the option to keep the old one, hence saving a few dollars in total.

That $7.5k incentive is actually very tempting as it would lower the price of the RAV4 Prime to somewhere around $34k, which is in the general ballpark of the higher-level standard RAV4 trims and only slightly more expensive than the higher-level standard C-RV trims. Definitely worth considering after all. Too bad availability in my area is "extremely limited" according to Toyota and I would have to drive all the way to Houston to even look at and test drive one.
« Last Edit: May 24, 2021, 02:39:18 PM by kms »

Paper Chaser

  • Pencil Stache
  • ****
  • Posts: 742
Re: New vs. used car - where has my math failed me?
« Reply #15 on: May 25, 2021, 03:48:00 AM »
That $7.5k incentive is actually very tempting as it would lower the price of the RAV4 Prime to somewhere around $34k, which is in the general ballpark of the higher-level standard RAV4 trims and only slightly more expensive than the higher-level standard C-RV trims. Definitely worth considering after all. Too bad availability in my area is "extremely limited" according to Toyota and I would have to drive all the way to Houston to even look at and test drive one.

With as little as you drive, I'd wager that nearly all of your miles would be done in EV mode with a PHEV like the Rav4 Prime. That really cuts down on the amount of maintenance that needs to be done. I do about 50-55% of my miles as an EV. The only maintenance I've needed in the last 30k miles has been 1 oil change. Brakes are rarely even used thanks to regen. The lifetime fuel economy crests 90mpg in the warmer months, and settles in the upper 80s when it's cold so I'm filling the tank once very 1000 miles or so. You could probably do even better with your driving habits.

Have you looked at a used Ford CMax? They're great deals on the used market. They're a hatchback car, rather than a lifted CUV, but they offer similar upright seating position and visibility as something like a Rav 4 or CRV. You can get them as a standard hybrid, or a Plug-in hybrid like the Prime stuff. You could end up with 90% of the feel/efficiency of a Rav4 Prime at 50% of the purchase price:

https://www.autotrader.com/cars-for-sale/vehicledetails.xhtml?listingId=586881422&allListingType=all-cars&fuelTypeGroup=PIH&makeCodeList=FORD&modelCodeList=FOCMAX&city=Austin&state=TX&zip=73301&location=&searchRadius=100&marketExtension=include&isNewSearch=false&showAccelerateBanner=false&sortBy=relevance&numRecords=25&dma=&referrer=%2Fcars-for-sale%2Fall-cars%2Fplug-in-hybrid%2Fford%2Fc-max%2Faustin-tx-73301%3Fdma%3D%26searchRadius%3D100%26location%3D%26marketExtension%3Dinclude%26isNewSearch%3Dfalse%26showAccelerateBanner%3Dfalse%26sortBy%3Drelevance%26numRecords%3D25&clickType=listing
« Last Edit: May 25, 2021, 03:59:14 AM by Paper Chaser »

DeniseNJ

  • Pencil Stache
  • ****
  • Posts: 560
Re: New vs. used car - where has my math failed me?
« Reply #16 on: May 25, 2021, 07:01:12 AM »
Kia is a piece of crap, esp compared to Toyota or Honda. There really is just no comparison. The toyota and honda you mentioned can go 300K miles.  You could have those cars for 20 to 30 years!! Kias start to fall apart at 100K. A honda or toyota is 3 times the car. Literally.

New car dealers did not account for a shortage of computer chips during covid so there are fewer and the prices are up. Making used car prices go up too bc of more demand for them.  However, toyota isn't suffering the chip crisis bc they plan ahead and have relationships with manufacturers. You could buy a kia or for almost the same price you could get a comparable toyota that will last 3x as long.

Since used toyota prices are inflated along with other used cars, buy a new toyota and drive it for decades. You will definitely get your money's worth. (I have been properly brain washed by Scotty Kilmer on Youtube.)

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #17 on: May 25, 2021, 07:10:22 AM »
Have you looked at a used Ford CMax? They're great deals on the used market. They're a hatchback car, rather than a lifted CUV, but they offer similar upright seating position and visibility as something like a Rav 4 or CRV. You can get them as a standard hybrid, or a Plug-in hybrid like the Prime stuff. You could end up with 90% of the feel/efficiency of a Rav4 Prime at 50% of the purchase price:

I have honestly not yet considered a Ford, Chevy, or any other US car maker due to their overall rather questionable reliability. Is the C-MAX Energi any better in this regard? I wouldn't mind a compact MPV at all as it seems to have an upright and higher than average seating position which should be okay for my wife.

Personally, I really only have three criteria for this vehicle. It needs to be reliable, it needs to have CarPlay (I've grown accustomed to it after replacing the original stereo in my Sedona), and it needs to be a comfortable long-distance vehicle. We already have a Kia Soul with a puny naturally aspirated 1.6l engine which is great for the city but gets incredibly noisy and almost rambunctious at 65 mph and above, and is thus largely useless for long-distance trips. How does the C-MAX perform at highway speeds, any idea? Is it a comfortable long-distance vehicle or a screamer at 75 mph?

Also, I just looked at the numbers and did the math on the C-MAX Energi and just like the RAV4 or C-RV (or any other car that sells new in that $25k-$35k bracket) its depreciation seems to hover around $10-$12k for the first 5 years with another $9-11k for the second five years. It almost seems to me that no matter what I am going to do the car is going to cost me around $2k per year, whether it's brand-new ($10k in depreciation with no repairs) or 10 years old (less depreciation but costly repairs).

If only I had the time to perform all required repairs myself...
« Last Edit: May 25, 2021, 07:16:04 AM by kms »

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #18 on: May 25, 2021, 07:15:53 AM »
Since used toyota prices are inflated along with other used cars, buy a new toyota and drive it for decades. You will definitely get your money's worth. (I have been properly brain washed by Scotty Kilmer on Youtube.)
Yeah, I've been down the Kilmer rabbithole myself. This is what I have narrowed in on now. It is most likely going to be either a brand-new RAV4 or CR-V, whichever I find a better deal on.

Morning Glory

  • Magnum Stache
  • ******
  • Posts: 2710
  • Location: The Garden Path
Re: New vs. used car - where has my math failed me?
« Reply #19 on: May 25, 2021, 07:40:41 AM »
My brother has some experience in the auto industry. I was looking at the Ford Fusion hybrids and he told me to stay away from Fords because of sloppy quality standards. He thinks that Hyundai and Kia are the best value for money right now anyway. I almost got a Kia Soul but I wanted more cargo space (cue the facepunches).

What is Car Play?

RWD

  • Magnum Stache
  • ******
  • Posts: 4917
  • Location: Mississippi
Re: New vs. used car - where has my math failed me?
« Reply #20 on: May 25, 2021, 08:10:04 AM »
Kia is a piece of crap, esp compared to Toyota or Honda. There really is just no comparison. The toyota and honda you mentioned can go 300K miles.  You could have those cars for 20 to 30 years!! Kias start to fall apart at 100K. A honda or toyota is 3 times the car. Literally.
Remind me again how many threads you've started recently on things that have broke on your Toyota-engined vehicle? Like 5 or 6, right?

This is really unfair to Kia which has made great strides in the last decade to build competitive and reliable cars. Sure, they still aren't quite at the level of Toyota/Lexus but to say they fall apart at 100k miles is patently false. Their powertrains are warrantied for 10 years/100k miles! Compare to Toyota's 5 years/60k miles. With proper maintenance you can expect a brand new Kia to last over 200k miles. (here's one with 300k miles)

Hyundai/Kia are poised to be leading the EV market with their second generation of EVs launching at the end of this year. They are not to be underestimated. Meanwhile Toyota doesn't have any pure BEVs in the pipeline until 2023.

I'm not saying that OP should necessarily buy a Kia (I still recommend the RAV4 Prime for their scenario) but you shouldn't rule them out just because you've drunk the Kilmer Kool-aid. If it was a year from now I would be recommending the Kia EV6 and Hyundai Ioniq 5 instead.

nereo

  • Senior Mustachian
  • ********
  • Posts: 14921
  • Location: Just south of Canada
    • Here's how you can support science today:
Re: New vs. used car - where has my math failed me?
« Reply #21 on: May 25, 2021, 08:35:43 AM »
Kia is a piece of crap, esp compared to Toyota or Honda. There really is just no comparison. The toyota and honda you mentioned can go 300K miles.  You could have those cars for 20 to 30 years!! Kias start to fall apart at 100K. A honda or toyota is 3 times the car. Literally.
Remind me again how many threads you've started recently on things that have broke on your Toyota-engined vehicle? Like 5 or 6, right?

This is really unfair to Kia which has made great strides in the last decade to build competitive and reliable cars. Sure, they still aren't quite at the level of Toyota/Lexus but to say they fall apart at 100k miles is patently false. Their powertrains are warrantied for 10 years/100k miles! Compare to Toyota's 5 years/60k miles. With proper maintenance you can expect a brand new Kia to last over 200k miles. (here's one with 300k miles)

Hyundai/Kia are poised to be leading the EV market with their second generation of EVs launching at the end of this year. They are not to be underestimated. Meanwhile Toyota doesn't have any pure BEVs in the pipeline until 2023.

I'm not saying that OP should necessarily buy a Kia (I still recommend the RAV4 Prime for their scenario) but you shouldn't rule them out just because you've drunk the Kilmer Kool-aid. If it was a year from now I would be recommending the Kia EV6 and Hyundai Ioniq 5 instead.

Consumer Reports keeps some pretty detailed numbers for reliability, repair costs and overall testing.  Kia has some very highly rated vehicles as of late, including the Sportage and the Telluride, with top marks for reliability. As RWD said - they've made enormous strides over the last decade and now make some excellent cars that can compete with the likes of Toyota and Honda on every category. 

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #22 on: May 25, 2021, 08:43:01 AM »
What is Car Play?
CarPlay and Android Auto are full integration of your smartphone into your car's infotainment system, either wirelessly or via USB cable, to use its apps such as Google Maps, Apple Maps, Waze, etc. for navigation, make or receive phone calls, read messages aloud and reply to them using a voice assistant that actually works, etc.

Think of it like an extension of your smartphone with all its features into your car.

Their powertrains are warrantied for 10 years/100k miles! Compare to Toyota's 5 years/60k miles. With proper maintenance you can expect a brand new Kia to last over 200k miles. (here's one with 300k miles)
I actually agree 100% with that. My Sedona's powertrain is flawless after 150k miles. Runs like a champ, and I haven't had any issues with it. I have the full service records for this car and there hasn't been a single documented powertrain issue since this car was brand-new. In my specific case it's not the powertrain that is failing me but its periphery - A/C system, airbag system, TPMS system, etc. Overall, this car has been a champ for the last 150k miles.

In the meantime I have ruled out the RAV4 Prime by the way (unless of course I find a dirt cheap one). First of all there don't seem to be any available for purchase right now (unless I am too stupid to search there isn't a single RAV4 Prime listed on Autotrader anywhere in the US), and second it doesn't make any financial sense given how little I drive and how cheap gas is in Texas.

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #23 on: May 25, 2021, 08:50:24 AM »
Consumer Reports keeps some pretty detailed numbers for reliability, repair costs and overall testing.  Kia has some very highly rated vehicles as of late, including the Sportage and the Telluride, with top marks for reliability.
How can they make any statements regarding the Telluride's reliability? Wasn't that model only introduced last year?

nereo

  • Senior Mustachian
  • ********
  • Posts: 14921
  • Location: Just south of Canada
    • Here's how you can support science today:
Re: New vs. used car - where has my math failed me?
« Reply #24 on: May 25, 2021, 08:52:53 AM »

In the meantime I have ruled out the RAV4 Prime by the way (unless of course I find a dirt cheap one). First of all there don't seem to be any available for purchase right now (unless I am too stupid to search there isn't a single RAV4 Prime listed on Autotrader anywhere in the US), and second it doesn't make any financial sense given how little I drive and how cheap gas is in Texas.

We are seriously considering a Rav4 Prime, but you are unlikely to find a used one dirt-cheap right now.  1) I believe 2020 2021 was the first model year they existed, so not even long enough for any to come off short-term leases, 2) they are very popular, and there's not very many of them (I believe there's fewer than 5,000 in all of N. America for model 2020). 3) as discussed there's an overall shortage of cars in general right now, so very new ones that are "dirt cheap" will be like finding a unicorn during hunting season.
« Last Edit: May 25, 2021, 09:02:22 AM by nereo »

RWD

  • Magnum Stache
  • ******
  • Posts: 4917
  • Location: Mississippi
Re: New vs. used car - where has my math failed me?
« Reply #25 on: May 25, 2021, 08:56:19 AM »
In the meantime I have ruled out the RAV4 Prime by the way (unless of course I find a dirt cheap one). First of all there don't seem to be any available for purchase right now (unless I am too stupid to search there isn't a single RAV4 Prime listed on Autotrader anywhere in the US), and second it doesn't make any financial sense given how little I drive and how cheap gas is in Texas.
I see 553 RAV4 Prime listings on Autotrader (though none of these appear to be particularly close to Austin for whatever reason).

Consumer Reports keeps some pretty detailed numbers for reliability, repair costs and overall testing.  Kia has some very highly rated vehicles as of late, including the Sportage and the Telluride, with top marks for reliability.
How can they make any statements regarding the Telluride's reliability? Wasn't that model only introduced last year?
They can extrapolate from experiences of the first year and other vehicles from the brand. Also, the Telluride actually started sales in spring of 2019 as a 2020 model so it has two years of data now, not one. Consumer Reports reliability FAQ: https://www.consumerreports.org/car-reliability-owner-satisfaction/consumer-reports-car-reliability-faq/

RWD

  • Magnum Stache
  • ******
  • Posts: 4917
  • Location: Mississippi
Re: New vs. used car - where has my math failed me?
« Reply #26 on: May 25, 2021, 08:58:28 AM »

In the meantime I have ruled out the RAV4 Prime by the way (unless of course I find a dirt cheap one). First of all there don't seem to be any available for purchase right now (unless I am too stupid to search there isn't a single RAV4 Prime listed on Autotrader anywhere in the US), and second it doesn't make any financial sense given how little I drive and how cheap gas is in Texas.

We are seriously considering a Rav4 Prime, but you are unlikely to find a used one dirt-cheap right now.  1) I believe 2020 was the first model year they existed, so not even long enough for any to come off short-term leases, 2) they are very popular, and there's not very many of them (I believe there's fewer than 5,000 in all of N. America for model 2020). 3) as discussed there's an overall shortage of cars in general right now, so very new ones that are "dirt cheap" will be like finding a unicorn during hunting season.
2021 is the first model year for the RAV4 Prime (first delivery July 2020).

nereo

  • Senior Mustachian
  • ********
  • Posts: 14921
  • Location: Just south of Canada
    • Here's how you can support science today:
Re: New vs. used car - where has my math failed me?
« Reply #27 on: May 25, 2021, 09:03:44 AM »

In the meantime I have ruled out the RAV4 Prime by the way (unless of course I find a dirt cheap one). First of all there don't seem to be any available for purchase right now (unless I am too stupid to search there isn't a single RAV4 Prime listed on Autotrader anywhere in the US), and second it doesn't make any financial sense given how little I drive and how cheap gas is in Texas.

We are seriously considering a Rav4 Prime, but you are unlikely to find a used one dirt-cheap right now.  1) I believe 2020 was the first model year they existed, so not even long enough for any to come off short-term leases, 2) they are very popular, and there's not very many of them (I believe there's fewer than 5,000 in all of N. America for model 2020). 3) as discussed there's an overall shortage of cars in general right now, so very new ones that are "dirt cheap" will be like finding a unicorn during hunting season.
2021 is the first model year for the RAV4 Prime (first delivery July 2020).

thanks - good catch. 
I was shocked when I saw one in my own neighborhood last August, because I knew how rare (at the time) they were. 

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #28 on: May 25, 2021, 09:08:12 AM »
Thank you, @RWD. I think my search filter didn't update and was stuck at 500 miles distance. And with the closest being 650 miles away from Austin it appeared as if there weren't any listed anywhere in the US. And I guess the reason why there aren't that many hybrids or EVs around in Texas is fairly simple: they don't make much sense around here. Distances are enormous, many people seem to forget how big Texas really is, and fuel is dirt cheap with less than or around $2 per gallon on average. Small inner-city commuter EVs such as the Nissan Leaf are not uncommon but that's pretty much it.

They can extrapolate from experiences of the first year and other vehicles from the brand. Also, the Telluride actually started sales in spring of 2019 as a 2020 model so it has two years of data now, not one. Consumer Reports reliability FAQ: https://www.consumerreports.org/car-reliability-owner-satisfaction/consumer-reports-car-reliability-faq/
I see, thank you for the explanation.

DeniseNJ

  • Pencil Stache
  • ****
  • Posts: 560
Re: New vs. used car - where has my math failed me?
« Reply #29 on: May 25, 2021, 09:28:38 AM »
Kia is a piece of crap, esp compared to Toyota or Honda. There really is just no comparison. The toyota and honda you mentioned can go 300K miles.  You could have those cars for 20 to 30 years!! Kias start to fall apart at 100K. A honda or toyota is 3 times the car. Literally.
Remind me again how many threads you've started recently on things that have broke on your Toyota-engined vehicle? Like 5 or 6, right?

This is really unfair to Kia which has made great strides in the last decade to build competitive and reliable cars. Sure, they still aren't quite at the level of Toyota/Lexus but to say they fall apart at 100k miles is patently false. Their powertrains are warrantied for 10 years/100k miles! Compare to Toyota's 5 years/60k miles. With proper maintenance you can expect a brand new Kia to last over 200k miles. (here's one with 300k miles)

Hyundai/Kia are poised to be leading the EV market with their second generation of EVs launching at the end of this year. They are not to be underestimated. Meanwhile Toyota doesn't have any pure BEVs in the pipeline until 2023.

I'm not saying that OP should necessarily buy a Kia (I still recommend the RAV4 Prime for their scenario) but you shouldn't rule them out just because you've drunk the Kilmer Kool-aid. If it was a year from now I would be recommending the Kia EV6 and Hyundai Ioniq 5 instead.

lol--My pontiac vibe is a 2010 and 115K miles. I got it for $3,400 a few months ago. I've replaces fluids, filters, spark plugs, tires and such, bc of its age, not bc it needed acnytihng since it ran fine. Other than that the only thing actually wrong was a minor oil leak and the front struts were worn, which I replaced (the tire guy said they needed replacing even though they seemed to be working fine).

All my other frustrations, like not being able to get the tire off, are from my own ignorance and inexperience. I just spent all day installing a new bluetooth radio/back up camera and it had me cursing but I got it done.  I honestly love this car. It's just every time I do something I mess up something else.  That's not the car's fault. What I've done has been strictly preventative maintenance--the car was driving fine. Don't say nothin' 'bout my baby. :)

DeniseNJ

  • Pencil Stache
  • ****
  • Posts: 560
Re: New vs. used car - where has my math failed me?
« Reply #30 on: May 25, 2021, 09:52:23 AM »
I had a Kia Sportage. It was OK, but I didn't love it. I had a 2014 Kia Sorento which I bought brand new and was a piece of crap. By the time I left the dealership with extended warranties and such, it was $29K. Rode like crap. I got it Saturday, by Monday morning I was already cursing. Crap in snow. I mean totally unsafe in any snow. My kid wrecked it at 50K miles--I was glad.  I used to leave it unlocked hoping it would get stolen.

My husband has a 2013 Hyundai Elantra bought new (this was before MMM).  There is always something wrong with it. I wouldn't say it was crap but wouldn't buy another one.  My fav car was my Ford Taurus with the way back seats.  that was a 2000 I got in 2010. It didn't last long but I did love that car.

Paper Chaser

  • Pencil Stache
  • ****
  • Posts: 742
Re: New vs. used car - where has my math failed me?
« Reply #31 on: May 25, 2021, 09:53:06 AM »
Have you looked at a used Ford CMax? They're great deals on the used market. They're a hatchback car, rather than a lifted CUV, but they offer similar upright seating position and visibility as something like a Rav 4 or CRV. You can get them as a standard hybrid, or a Plug-in hybrid like the Prime stuff. You could end up with 90% of the feel/efficiency of a Rav4 Prime at 50% of the purchase price:

I have honestly not yet considered a Ford, Chevy, or any other US car maker due to their overall rather questionable reliability. Is the C-MAX Energi any better in this regard? I wouldn't mind a compact MPV at all as it seems to have an upright and higher than average seating position which should be okay for my wife.

Personally, I really only have three criteria for this vehicle. It needs to be reliable, it needs to have CarPlay (I've grown accustomed to it after replacing the original stereo in my Sedona), and it needs to be a comfortable long-distance vehicle. We already have a Kia Soul with a puny naturally aspirated 1.6l engine which is great for the city but gets incredibly noisy and almost rambunctious at 65 mph and above, and is thus largely useless for long-distance trips. How does the C-MAX perform at highway speeds, any idea? Is it a comfortable long-distance vehicle or a screamer at 75 mph?

I wouldn't dismiss too many manufacturers outright (Fiat and Alfa Romeo excepted). A lot of them make some decent vehicles and some junk too. In general, Ford's hybrids are known for strong reliability. Their hybrid system closely mirrors that of Toyota's. In fact, they originally licensed the CVT transmission design from Toyota. Over time they modified the transmission, and eventually Toyota followed suit with their own copy of Ford's copy. Anyway, the transmission is the most critical part of those hybrid systems, and they're remarkably simple and reliable. Priuses go forever. Fords have similar hardware for less money. Will it compare to a Toyota hybrid for reliability? I'm not sure, but I'd bet that the lower purchase price means the Total Cost of Ownership is probably pretty comparable over time. NYC did a study of their fleet maintenance costs and there were several Ford models that stood out as both good and bad. The overall trend is clear though. The more a vehicle can run on electricity than ICE, the lower it's running costs tend to be:



That being said, I have no personal experience with a CMax. My Fusion energi has the same powertrain, but it's in a much different chassis. My car does highway miles very well, but that may change when you switch to a smallish hatchback with shorter wheelbase, larger cross section for wind buffeting and lower starting price. If you want something to cruise effortlessly at 65+mph, then you end up with larger, more expensive vehicles. They have longer wheelbases, more sound deadening, and torquier drivetrains.

Morning Glory

  • Magnum Stache
  • ******
  • Posts: 2710
  • Location: The Garden Path
Re: New vs. used car - where has my math failed me?
« Reply #32 on: May 25, 2021, 10:08:58 AM »
I had a Kia Sportage. It was OK, but I didn't love it. I had a 2014 Kia Sorento which I bought brand new and was a piece of crap. By the time I left the dealership with extended warranties and such, it was $29K. Rode like crap. I got it Saturday, by Monday morning I was already cursing. Crap in snow. I mean totally unsafe in any snow. My kid wrecked it at 50K miles--I was glad.  I used to leave it unlocked hoping it would get stolen.

My husband has a 2013 Hyundai Elantra bought new (this was before MMM).  There is always something wrong with it. I wouldn't say it was crap but wouldn't buy another one.  My fav car was my Ford Taurus with the way back seats.  that was a 2000 I got in 2010. It didn't last long but I did love that car.

My daily driver is a 2003 dodge neon that I've had since college. It came with 16" rims and dumbass low profile tires.  I thought it was crap in snow until my husband got some 14" rims at the junkyard so that I could run real snow tires. That makes all the difference. I trust that thing anywhere now.

It is falling apart from rust and looks like garbage but it's still fun to drive. (2.0L with 5 speed manual!)
« Last Edit: May 25, 2021, 10:22:15 AM by Morning Glory »

nereo

  • Senior Mustachian
  • ********
  • Posts: 14921
  • Location: Just south of Canada
    • Here's how you can support science today:
Re: New vs. used car - where has my math failed me?
« Reply #33 on: May 25, 2021, 10:37:17 AM »
I had a Kia Sportage. It was OK, but I didn't love it. I had a 2014 Kia Sorento which I bought brand new and was a piece of crap. By the time I left the dealership with extended warranties and such, it was $29K. Rode like crap. I got it Saturday, by Monday morning I was already cursing. Crap in snow. I mean totally unsafe in any snow. My kid wrecked it at 50K miles--I was glad.  I used to leave it unlocked hoping it would get stolen.

My husband has a 2013 Hyundai Elantra bought new (this was before MMM).  There is always something wrong with it. I wouldn't say it was crap but wouldn't buy another one.  My fav car was my Ford Taurus with the way back seats.  that was a 2000 I got in 2010. It didn't last long but I did love that car.

What??  After discussing how much progress Kia has made in the last decade your response is to reference your experience from a 9 model-year old vehicle? How does that further the conversation?

ChpBstrd

  • Magnum Stache
  • ******
  • Posts: 3221
Re: New vs. used car - where has my math failed me?
« Reply #34 on: May 25, 2021, 10:48:34 AM »
The thing that is wrong with your math is the assumption that the used car shortage will still be in place 5 years from now, and therefore your depreciation will only be about $10k. If this assumption is wrong, the market 5 years from now might look more typical and your depreciation might be closer to 60% of the car's retail price (It is historically typical for a 5 y/o car to retain 37% of its retail value). The manufacturing bottlenecks will be resolved eventually.



DeniseNJ

  • Pencil Stache
  • ****
  • Posts: 560
Re: New vs. used car - where has my math failed me?
« Reply #35 on: May 25, 2021, 11:22:26 AM »
I had a Kia Sportage. It was OK, but I didn't love it. I had a 2014 Kia Sorento which I bought brand new and was a piece of crap. By the time I left the dealership with extended warranties and such, it was $29K. Rode like crap. I got it Saturday, by Monday morning I was already cursing. Crap in snow. I mean totally unsafe in any snow. My kid wrecked it at 50K miles--I was glad.  I used to leave it unlocked hoping it would get stolen.

My husband has a 2013 Hyundai Elantra bought new (this was before MMM).  There is always something wrong with it. I wouldn't say it was crap but wouldn't buy another one.  My fav car was my Ford Taurus with the way back seats.  that was a 2000 I got in 2010. It didn't last long but I did love that car.

What??  After discussing how much progress Kia has made in the last decade your response is to reference your experience from a 9 model-year old vehicle? How does that further the conversation?

I guess it doesn't. I'm just saying why I don't like Kias.  Obviously I'm biased, but once you've had a car you hated, you just aren't likely to buy, or recommend, another one. Gosh, has it been 9 yrs already?  Nah, only 7, and it only had 50K miles on it so it seemed pretty new to me.  Seems like yesterday. And yes, I totally drank the Kilmer koolaid. I'd buy a used car from that guy.

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #36 on: May 25, 2021, 11:58:15 AM »
The thing that is wrong with your math is the assumption that the used car shortage will still be in place 5 years from now, and therefore your depreciation will only be about $10k. If this assumption is wrong, the market 5 years from now might look more typical and your depreciation might be closer to 60% of the car's retail price (It is historically typical for a 5 y/o car to retain 37% of its retail value). The manufacturing bottlenecks will be resolved eventually.
That's very true. However, wouldn't that also be true for a used vehicle? As in if I purchase a used one now at an inflated price I am going to lose much more than the current numbers are predicting?

gooki

  • Magnum Stache
  • ******
  • Posts: 2555
  • Location: NZ
    • My FIRE journal
Re: New vs. used car - where has my math failed me?
« Reply #37 on: May 25, 2021, 01:05:17 PM »
Correct

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #38 on: May 25, 2021, 01:29:30 PM »
So, to summarize: my math is correct. In a non-inflated market cars such as the RAV4 or C-RV should depreciate by around 20-25% within the first two years as a rule of thumb. Which also coincides with the depreciation calculator I found on https://caredge.com/depreciation showing historical as well as average depreciation rates for various makes and models. However, market prices for gently used 1-3 year old cars are massively inflated right now due to a used car shortage, and therefore the general rule of thumb no longer applies. If I have to purchase a car right now I am better off, or at least not off any worse, with a brand-new one rather than a used one. If, however, I can wait a bit longer and wait for the used car market to settle again it would be highly advisable. Correct?

If so the question will be how much will I have to spend now to keep the Sedona running for another year or two vs. how much will I save in a year or two on a gently used car that I would have to otherwise buy new today.
« Last Edit: May 25, 2021, 01:54:29 PM by kms »

ChpBstrd

  • Magnum Stache
  • ******
  • Posts: 3221
Re: New vs. used car - where has my math failed me?
« Reply #39 on: May 25, 2021, 02:23:04 PM »
The thing that is wrong with your math is the assumption that the used car shortage will still be in place 5 years from now, and therefore your depreciation will only be about $10k. If this assumption is wrong, the market 5 years from now might look more typical and your depreciation might be closer to 60% of the car's retail price (It is historically typical for a 5 y/o car to retain 37% of its retail value). The manufacturing bottlenecks will be resolved eventually.
That's very true. However, wouldn't that also be true for a used vehicle? As in if I purchase a used one now at an inflated price I am going to lose much more than the current numbers are predicting?

Yes, both will depreciate faster once the supply bottlenecks are fixed, but the new car will depreciate more in absolute terms than a used car. For example, if a $25,000 new car and a $10,000 used car both lose half their value... Of course, if you paid $20k for the used car which was worth $10k, the math might be different!

Quote
the question will be how much will I have to spend now to keep the Sedona running for another year or two vs. how much will I save in a year or two on a gently used car that I would have to otherwise buy new today.

In a scenario where the used car market reverts to historical norms in another year or two, you'll be able to buy a five-year-old car (2018 or 2019 model) for about 37% of its new price. If you bought a new car in 2021 in this scenario, it would depreciate by about 25% in year one and 15.6% of that in year two.
https://goodcalculators.com/car-depreciation-calculator/

This should be enough info to calculate the fix vs. buy costs, but I think I know the answer. You could put a new engine, transmission, and wiper blades in the Sedona for less than a year of normal depreciation on a new SUV.

Also, for the Sedona you should be carrying liability-only insurance. For a new car, you'd need full coverage. This alone will amount to several hundred dollars per year of extra spending on the new car vs. the old. It's just a less-visible cost than the mechanic shop's. :)

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #40 on: May 25, 2021, 08:06:18 PM »
I see what youíre saying, and while I think that 62.5% depreciation in 5 years is rather optimistic for a CR-V and a RAV4 (model-specific calculators tend to predict more around 50% over 5 years for those two) I agree with your general reasoning and logic.

The quote and inspection results for my Sedona came back. Fixing it back to a usable condition is going to cost at least $2,500. Iím torn but inclined to invest that money and give the Sedona another chance.
« Last Edit: May 25, 2021, 08:17:01 PM by kms »

AccidentialMustache

  • Pencil Stache
  • ****
  • Posts: 521
Re: New vs. used car - where has my math failed me?
« Reply #41 on: May 25, 2021, 09:04:30 PM »
If you think an EV may be in your future, buying a little time now with minor(ish) repairs may be a good move, to let the EV market (and used EV market) settle out a little bit first. Food for thought?

JLee

  • Walrus Stache
  • *******
  • Posts: 6724
Re: New vs. used car - where has my math failed me?
« Reply #42 on: May 25, 2021, 09:07:36 PM »
I see what youíre saying, and while I think that 62.5% depreciation in 5 years is rather optimistic for a CR-V and a RAV4 (model-specific calculators tend to predict more around 50% over 5 years for those two) I agree with your general reasoning and logic.

The quote and inspection results for my Sedona came back. Fixing it back to a usable condition is going to cost at least $2,500. Iím torn but inclined to invest that money and give the Sedona another chance.

Can you do any of the repairs yourself?

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #43 on: May 26, 2021, 06:46:57 AM »
If you think an EV may be in your future, buying a little time now with minor(ish) repairs may be a good move, to let the EV market (and used EV market) settle out a little bit first. Food for thought?
I don't think an EV is in my future. As I have already explained I don't drive nearly enough (less than 6k over the last three years on average) and gas is dirt cheap in Texas. It simply doesn't make any financial sense for me as the savings would never make up for the price difference over the lifetime of the vehicle.

Can you do any of the repairs yourself?
Some, yes. I used to work on motorcycle engines a lot when I was younger so I am not a complete novice when it comes to engine maintenance and know my way around to a certain degree. I have already subtracted everything I can do myself or consider non-essential at the time being or mostly voodoo from the original $4,000 quote and am now left with $2,500 for fixing the A/C ($1,100 for new condenser, new schrader valves, and recharge), replacing the leaky valve cover gasket and spark plugs ($200 parts, $1,000 labor!), an oil change, and some extra bits and parts required for these two jobs. Fortunately, the airbag system seems to be okay after all. The airbag light was caused by low battery voltage, a known issue with this generation Sedona, and did not come back after it was cleared. However, while on the lift they discovered a major oil leak caused by a leaky valve cover gasket that drips right onto the alternator and needs to be addressed right away.

I've slept on it and authorized the repairs a few minutes ago. Hopefully, by the time the next big thing breaks the used car market will have settled again.

nereo

  • Senior Mustachian
  • ********
  • Posts: 14921
  • Location: Just south of Canada
    • Here's how you can support science today:
Re: New vs. used car - where has my math failed me?
« Reply #44 on: May 26, 2021, 08:55:57 AM »
If you think an EV may be in your future, buying a little time now with minor(ish) repairs may be a good move, to let the EV market (and used EV market) settle out a little bit first. Food for thought?
I don't think an EV is in my future. As I have already explained I don't drive nearly enough (less than 6k over the last three years on average) and gas is dirt cheap in Texas. It simply doesn't make any financial sense for me as the savings would never make up for the price difference over the lifetime of the vehicle.

I know this has been brought up, and I largely agree with you that fuel savings isn't going to add up to all that much (my back-of-the-envelop calculations suggest a net savings of about $200/year).  But the real cost savings with an BEV is with much lower maintenance. Over the span of 100k an ICE engine will need approx 15 oil & filter changes, four sets of spark plugs, a new timing and serpentine belt, new water pump, three differential oil replacements, plus engine coolant and a few other things I'm forgetting.

RWD

  • Magnum Stache
  • ******
  • Posts: 4917
  • Location: Mississippi
Re: New vs. used car - where has my math failed me?
« Reply #45 on: May 26, 2021, 09:03:09 AM »
Can you do any of the repairs yourself?
Some, yes. I used to work on motorcycle engines a lot when I was younger so I am not a complete novice when it comes to engine maintenance and know my way around to a certain degree. I have already subtracted everything I can do myself or consider non-essential at the time being or mostly voodoo from the original $4,000 quote and am now left with $2,500 for fixing the A/C ($1,100 for new condenser, new schrader valves, and recharge), replacing the leaky valve cover gasket and spark plugs ($200 parts, $1,000 labor!), an oil change, and some extra bits and parts required for these two jobs. Fortunately, the airbag system seems to be okay after all. The airbag light was caused by low battery voltage, a known issue with this generation Sedona, and did not come back after it was cleared. However, while on the lift they discovered a major oil leak caused by a leaky valve cover gasket that drips right onto the alternator and needs to be addressed right away.

I've slept on it and authorized the repairs a few minutes ago. Hopefully, by the time the next big thing breaks the used car market will have settled again.
Valve cover gaskets and spark plugs tend to be very easy to do yourself, certainly worth the $1k saved. Sounds like you already gave the go-ahead though.


If you think an EV may be in your future, buying a little time now with minor(ish) repairs may be a good move, to let the EV market (and used EV market) settle out a little bit first. Food for thought?
I don't think an EV is in my future. As I have already explained I don't drive nearly enough (less than 6k over the last three years on average) and gas is dirt cheap in Texas. It simply doesn't make any financial sense for me as the savings would never make up for the price difference over the lifetime of the vehicle.

I know this has been brought up, and I largely agree with you that fuel savings isn't going to add up to all that much (my back-of-the-envelop calculations suggest a net savings of about $200/year).  But the real cost savings with an BEV is with much lower maintenance. Over the span of 100k an ICE engine will need approx 15 oil & filter changes, four sets of spark plugs, a new timing and serpentine belt, new water pump, three differential oil replacements, plus engine coolant and a few other things I'm forgetting.

Less frequent brake replacements due to regenerative braking, as well. I recall reading one source that estimated over the lifetime (unsure if this was a specific number of years or mileage based) of the vehicle you would save between $6k and $10k in maintenance/repair costs by choosing a BEV over a ICE vehicle.

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #46 on: May 26, 2021, 09:54:49 AM »
I know this has been brought up, and I largely agree with you that fuel savings isn't going to add up to all that much (my back-of-the-envelop calculations suggest a net savings of about $200/year).  But the real cost savings with an BEV is with much lower maintenance. Over the span of 100k an ICE engine will need approx 15 oil & filter changes, four sets of spark plugs, a new timing and serpentine belt, new water pump, three differential oil replacements, plus engine coolant and a few other things I'm forgetting.
I think your estimates are way off there - where did you get them from? Are they averages, estimates, or a real example based on the maintenance schedule of an actual vehicle? They may apply to older engines but modern combustion engines require much much less maintenance. I am looking at the official maintenance schedule for our 2017 Kia Soul right now:

Oil & Filter: replace every 7,500 miles
Spark plugs: replace every 105,000 miles
Drive belts: inspect at 60,000 miles and replace if necessary; inspect every 15,000 miles thereafter if not replaced and replace when needed
Water pump: not mentioned, thus replace when needed
Differential oil: not mentioned, did you mean:
Automatic transaxle fluid: ever 60,000 miles
Engine coolant: replace at 120,000 miles

Valve cover gaskets and spark plugs tend to be very easy to do yourself, certainly worth the $1k saved. Sounds like you already gave the go-ahead though.

[...]

Less frequent brake replacements due to regenerative braking, as well. I recall reading one source that estimated over the lifetime (unsure if this was a specific number of years or mileage based) of the vehicle you would save between $6k and $10k in maintenance/repair costs by choosing a BEV over a ICE vehicle.
I would agree with you that valve cover gaskets tend to be easy to replace, and I've done quite a few in my life (again, on motorcycles, never on a car). However, on this particular vehicle with its sideways mounted V6 you have to remove the entire intake manifold as well as dozens of wires, cables, and hoses before you even get to the cover itself. And to add insult to injury the engine is mounted pretty far back with half of it being only partly accessible underneath the dashboard and windscreen of the car. This is, after all, a minivan with a very short engine bay but a massive 3.8l V6. There's a reason why mechanics quote $700 for a spark plug replacement on this car, or $1,200 for spark plugs plus valve cover gasket, and it's not because the car is easy to work on. So yes, I already gave them the go-ahead as I'd rather spend that day with my daughter than fiddling with the engine ;-)

Regarding the maintenance/repair cost savings: do those calculations take into account the fact that eventually, the battery on every EV is going to die? Correct me if I'm wrong as my knowledge of EVs is fairly limited, but isn't the battery by far the most expensive part? In other words: what good are $10k in savings if the battery will need to get replaced for $20k after 100,000 miles? How long are current batteries rated for anyway? 100,000 miles? 150,000 miles? More? I'm genuinely curious about this as I believe that electric vehicles are the future but I also don't believe that battery technology is quite there yet and will require more refinement along the way.
« Last Edit: May 26, 2021, 10:02:52 AM by kms »

nereo

  • Senior Mustachian
  • ********
  • Posts: 14921
  • Location: Just south of Canada
    • Here's how you can support science today:
Re: New vs. used car - where has my math failed me?
« Reply #47 on: May 26, 2021, 10:20:29 AM »
I don't want you to focus on minor details to the point where you might miss the larger picture. A common (and largely incorrect) perception right now is that 'EVs will save you a ton - because no gasoline'!  As you've correctly pointed out, that effect is actually rather small when comparing to a high-mpg vehicle and when fuel prices are relatively low.    The BULK of the savings from owning an EV is with less maintenance. Full stop.  The less you drive, the less that matters.

AS for specific maintenance schedules and expectations, the exact details are going to depend on what ICE vehicle you are comparing it to and how you drive. My numbers come from a Honda Civic's factory-recommended servicing for a mixture of city and freeway driving, because that's what I drove previously. As you noted, even among ICE cars not all vehicles will have the same parts (e.g. some use timing chains, others timing belts).  Then there's things like oil-changes, which most sources will recommend replacing at least annually (some say 2x) irrespective of miles driven.

There's a lot of further analysis on the subject if you care to look.  From consumer reports:
Quote
"Analysis of real-world maintenance and repair cost data from thousands of CR members shows that BEV and PHEV owners are paying half as much as ICE owners are paying to repair and maintain their vehicles."

Regarding battery replacement - yes that can be expensive, and replacing an entire battery pack can go anywhere from $800 to about $2700 depending on the vehicle.  But it appears to be pretty rare outside of the air-cooled battery packs in very hot weather (e.g. Nissan Leafs).  We now have a ton of data showing most vehicles have >80% of their initial capacity around the 150k mark,  Further, in many cases it's not  terribly hard (or expensive) to test and replace individual battery cells in a pack.  So while it's certainly a possibility one might want to plan for (particularly if you are in a very hot climate without a liquid0-cooled battery), but the cost of a new battery pack is on par or less than the cost of a new transmission.

Perhaps most interestingly, the estimated per-mile repair costs for BEVs is **much** less than ICE vehicles once they have between 100,000 - 200,000 miles on them ($0.043 vs $0.079) - this matches when one would expect to replace the battery pack, if ever.

RWD

  • Magnum Stache
  • ******
  • Posts: 4917
  • Location: Mississippi
Re: New vs. used car - where has my math failed me?
« Reply #48 on: May 26, 2021, 10:21:05 AM »
Regarding the maintenance/repair cost savings: do those calculations take into account the fact that eventually, the battery on every EV is going to die? Correct me if I'm wrong as my knowledge of EVs is fairly limited, but isn't the battery by far the most expensive part? In other words: what good are $10k in savings if the battery will need to get replaced for $20k after 100,000 miles? How long are current batteries rated for anyway? 100,000 miles? 150,000 miles? More? I'm genuinely curious about this as I believe that electric vehicles are the future but I also don't believe that battery technology is quite there yet and will require more refinement along the way.
I'm not entirely sure but battery costs have come down 90% in the last decade. So by the time you need a replacement (if ever) the price should be reasonable. Data on the early Teslas is showing only 10-15% degradation after around 150k-200k miles. So life of the pack could conceivably be for the entire life of the vehicle.

kms

  • Bristles
  • ***
  • Posts: 303
  • Location: Austin, TX
  • Minion Money Hippie
Re: New vs. used car - where has my math failed me?
« Reply #49 on: May 26, 2021, 10:33:22 AM »
Thank you both for your patience and your brilliant explanations, that was very enlightening.