A simple question which is often asked me, “Should I keep my car or should I sell it and buy a new one?” or “Is my car worth much?”
After it’s all said and done, one thing is for sure: it’s going to cost no matter which option you take. You will get a better understanding of this dilemma by comparing a new car recently purchased vs. the one described below; let’s view this case study number one.
Here is a 1992 S400se, v-8 gasoline engine: a Mercedes® flagship at the time, the current owner acquired it about five years ago pre-owned and in excellent condition. Now with 178,000 miles on the odometer, it’s starting to show the wear and tear, or to be more specific, the chassis noises are getting a bit louder, the interior and exterior are still in good shape, the engine and transmission are in great shape…is it time to fold it?
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Let’s see what happens if the owner buys one of the most fuel efficient cars in the market:
A Toyota® Prius, 45 miles to the gallon.
1. Cost of new Prius, 4cyl, electric/gasoline fuel engine: $24,500 plus interest expense, financed over 3 years it will be a total of $30,000 plus maintenance costs. It will also mean higher insurance premiums, DMV tax and license is included. The owner’s main problem is that she is inclined into buying a new car. Peer pressure and friends are telling her to get a new car. Here are the parameters we are basing our stats on: driving 15,000 miles a year, 45% hwy and 55% city driving, $2.05 per gal(april ’09), with the A/C on, faster acceleration and colder outside temperatures, so this example will show lower MPG estimates than pre 2008 EPA estimates:
a. 46.1 MPG
b. Cost to drive 25 miles: $1.11
c. Cost to fill up: $21.96
d. Tank size: 11.9 gallons
e. Miles to a tank: 493 miles
e. Annual fuel cost $677
f. Annual petroleum consumption: 7.4 barrels of crude (one barrel =42gallons)
g. Tons of C02, carbon footprint (greenhouse effect) emitted: 4.0 (3.5 is best, 16.2 worst)
h. Air pollution score: 8 (10 is best)
i. Safety: small cars are not too safe (my opinion).
j. Cylinders: 4
Here we can see that although the Prius is more fuel efficient, automotive engineers and scientists will still have to work harder at inventing a new non organic dependent fuel. It will put you back $30,000 bucks, the fuel cell battery is more toxic and will be expensive to replace($2700), a smaller car is not as safe as a bigger Nordic or German car, it will still need maintenance and its value will depreciate too…There are no tax incentives for this model either.
2. The 1992 Mercedes Benz®, S400se, 178,000 miles, has had an automatic transmission rebuilt two years ago, major fuel management system repair , a new waterpump and hoses and the serpintine belt has been replaced. Common repairs like brakes and oil changes too have been done according to factory recommendations. Overall, in three years time approximately $6,000 has been invested in the vechicle. It’s paid for, general maintenance is required every 7,500 ($125) miles for minor service, every 30,000 ($475) miles for major service. However, lower insurance premiums and lower DMV license fees due to vehicle’s depreciation. The owner’s main concern is that she does not want her car to brake down. Here are the parameters we are basing our stats: driving 15,000 miles a year, 45% hwy and 55% city driving, $2.28per gal(april ’09), with the A/C on, faster acceleration and colder outside temperatures, so this example will show lower MPG estimates than pre 2008 EPA estimates:
a. 13 MPG
b. Cost to drive 25 miles: $4.38
c. Cost to fill up tank: $59.28
d. Tank size: 26 gallons
e. Miles to a tank: 493 miles
e. Annual fuel cost $2630
f. Annual petroleum consumption: 26.3 barrels of crude (one barrel =42 gallons)
g. Tons of C02, carbon footprint (greenhouse effect) emitted: 14.1 (3.5 is best, 16.2 worst)
h. Air pollution score: not available, but it passes smog test…
i. Safety: large sedan, solid steel construction with built in roll cage, has air bags too, it weighs 5,000 lbs, so the Prius had better get out of the way!
j. Cylinders: 8
It would only be fair to prognosticate what can go wrong within the next five years on the 1992 S400se Mercedes to see if it would be worthwhile to keep it. Here are few parts and repairs that I think may go bad within the next 75,000 miles based on previous experience with automobiles having similar mileage and specs:
1. RPM sensors, other sensors, fuel system relays, fuel pumps, alternator, starter, catalytic converters, major A/C repairs, radiator, heater hoses, brake calipers, switches of all sorts, suspension/steering components, electrical seat repairs and routine maintenance. $8,000 bucks is what future expenses may cost…this estimate is a bit on the high side just to play the devil’s advocate. You may not need all of the described fixes since every case is different.
Final score: Well, the Mercedes owner is now leaning towards keeping her car since predictive repairs will be performed (see tab for details) and starting and stalling issues will have a much lower incidence, same as a new car. Since the Mercedes owner has more peace of mind now, she is planning her trip to Italy and visiting kinfolk and has plans to visit Tuscany for good measure. With the described savings she has made, she is investing in herself!
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