Can You Afford to Drive a Used Car? (Part 3)
In Part 1 of this series, we covered the impact of depreciation (OUCH!) and in Part 2 we talked about the benefits of buying a used – even a Certified Pre-Owned (CPO) – vehicle. In this third part we will discuss some of the tradeoffs to consider when not buying a new car.
One thing for us all to keep in mind is this: Every car was a new car. And every car will be a used car.
Yep. Even my first car, a 1981 Ford Escort, was once a new car. Hard to believe, I know, but it is true, someone once chose to buy that Smurf-blue, four-door hatchback with matching Smurf-blue vinyl interior and a one-speaker AM radio over any other car on the lot. (I still can’t come up with a reason for that choice, unless pickin’s were really slim.)
Along that same line, even the shiniest, top-of-the-line 2017 Rolls Royce will be a used car (albeit a very nice one)… as soon as the ownership is transferred.
If you really think about it, having a “new car” is a myth. A vehicle only classifies as new until it has its first owner. So, why are so many people willing to pay so much for a myth?
Most of the arguments we hear are that repairs are so expensive that people neeeed the new car warranty. However, as we explored in Part 2, we saw that CPO vehicles can be a substantial savings over the cost of a new vehicle – and they can carry extended warranties on the most expensive parts of the vehicle. As far as the bumper-to-bumper aspects of a new car, most buyers of new cars have already dealt with any hassles related to curing the annoying squeaks and tweaks that commonly occur with new vehicles. With those out of the way, the drive train is the biggest area of concern.
However, given the high manufacturing standards in this era of modern manufacturing, the vehicles of the last five, 10, or even 15 years are far superior to those coming off the assembly lines in the 70’s and 80’s. Which is where, in my opinion, most of our trepidation about the mechanical reliability of our vehicles comes from.
Growing up, I can remember my parents having discussions about how close one of our vehicles was getting to the dreaded 100,000 mile mark. Heck, back then, the odometers didn’t even have six digits on them – which led many to believe that even the manufacturers didn’t expect them to last more than 99,999 miles. Like many people, I grew up believing that any vehicle even approaching 100,000 miles was living on borrowed time.
This is not the case any more. Most CPO warranties cover drivetrains up to 100,000 miles. Even some factory warranties cover vehicles with that many miles on the odometer. We are driving our cars, trucks and SUVs more than ever before, and they are holding up better than ever before.
So, why not buy used?
The biggest argument I’ve heard against buying used is Technology. Whether it the ubiquitous Bluetooth connectivity that extends our hands-free lifestyle into our vehicles, or the nearly-standard backup cameras in new cars that were on overpriced option just a few years ago, or those cool heads-up displays… The list goes on.
The truth of the matter is that technology is advancing at unprecedented speeds, and more and more technological advancements are making their ways into our new cars. If you are one of those who cannot live without the latest and greatest technotoys, I’ve got some bad news for you: You’re in for an expensive and disappointing life.
Today’s latest and greatest options will be next year’s standard equipment. Or may even be obsolete altogether (Facebook app for your car anyone?).
Take my 2011 Toyota Camry, for example. It has an AM/FM/CD stereo with AUX input. But it does not have a backup camera, Bluetooth, or one of those cool features that scrolls the name of the song and artist across the LCD readout. Would I like those features? Maybe. Probably. Well, yeah, I would like them. However, it’s a Camry, so a backup camera is definitely not a necessity – I can just turn my head and look behind me like my forebears did in their covered wagons and Plymouth Furys. And, through the marvels of modern technology (gotta love Amazon), I picked up a Bluetooth adapter that plugs into my AUX jack for $10 – it is definitely not as convenient as a native Bluetooth receiver, but it works well and was cheap.
I just can’t figure out how to get that scrolling readout without changing out my whole radio unit for an aftermarket one. That is an option that I could use to not only add the native Bluetooth and artist/song title scrolling, but a backup camera as well. I’ve seen these at Car Toys for around $1,000. For me, the “benefits” of such an aftermarket stereo do not justify the high sticker price. However, I’ll be the first to admit that I’d rather spring for a $1,000 stereo that will upgrade my car to the latest technology than spend thousands more to buy a vehicle that comes with these features.
What about you? Can you still justify the expense of a new car? Or do think you can afford to drive a used car?
This feels like the right place to end this article, but not yet conclude this series. Please read the conclusion piece – Part 4 – where we discuss what you can do with all the money you’ll save by buying used.