From: B A R R Y on
Mike Hunter wrote:
> If one wants to calculate the TRUE annual cost of ownership, one must take
>
>
> In ten years, after they both have purchased another new car and the cycle
> begins again, who will have spent the most money per year? Are you
> surprised ?

If your math truly worked, major non-rental company fleets, like AT&T,
FedEx, the US Government, etc... would replace "non-image" cars and
trucks every 3-4 years. They don't.

By non-image, I'm referring to vehicles purchase for utility, where
overall cost is more important than aesthetic appearance.

From: Jeff on
Mike Hunter wrote:
> If one wants to calculate the TRUE annual cost of ownership, one must take
> into consideration the total cost of acquiring a vehicle, insuring,
> maintaining, repairing and operating that vehicle and at some point the
> replacement cost for another new vehicle.
>
> Assume two buyers buy exactly the same $25,000 car. One buyer is the average
> American new car buyer who replaces their car in three to four years. The
> other buys a new car every ten years. The average person in the US drives
> 15,000 miles per year. For a 3, 4, and ten year old cars that will 45K, 60K
> and 150K miles. The average deprecation in 3 years is 20%, in four 30%, in
> ten year 95% For the purpose of calculation, assume the cars have four
> year 60K warranties and the owners are covered by equal insurance policies,
> at the same cost, both cars use the same amount of fuel, each vehicle needs
> an annual state inspection at $75, every owner performs all of the required
> normal preventive 5K maintenance, that averages $50, as well as the required
> 15K maintenance that averages $400, each has a major repair $1,500 and a new
> vehicle goes up $1,000 a year. You can set you own average shop rate and
> part prices to make the comparison. Assume warranty covered repairs, the
> 45K, 60K and 150 maintenance need not be added in, since the owners will be
> replacing the vehicle(s)
>
> In ten years, after they both have purchased another new car and the cycle
> begins again, who will have spent the most money per year? Are you
> surprised ?

Only with your assumptions. For example, if I buy a new car now, in 5
years it will be paid off. if I buy one every three years, I will always
be paying interest.

I pay a lot less in insurance that I did when my car was brand new. I
don't need any collusion. So your assumptions about insurance are
inaccurate, too.

According to this USA today article, the depreciation is 65%, on
average, after 5 years. That's about 13% a year. So in three years, the
average car will have decreased in value about 40% and a little over 50%
in four (different cars depreciate at different rates). Not to mention
that I will lose more on the value of the car in trade in, because if I
trade it into the dealer, I will get wholesale, prices, not the retail
prices that the retailers sell used cars for.

http://www.usatoday.com/money/autos/2005-12-22-resale-usat_x.htm

It is cheaper to keep an old car rather than buy a new one, most of the
time.

You have to run the numbers, of course. But you need accurate numbers.

Jeff

> Mike
>
>
> "Nza" <thenza(a)yahoo.com> wrote in message
> news:1185736742.131983.194540(a)q75g2000hsh.googlegroups.com...
>> On Jul 3, 3:54 pm, "Cathy F." <clfrc...(a)adelphia.net> wrote:
>>> I just checked the Toyota's site: the hybrid battery's warranty is for 8
>>> years/100K miles. I tend to keep my cars a while, & the longest I've
>>> ever
>>> kept one has been 8 years, the shortest was 4, and usually it's 6 years.
>>> I
>>> personally wouldn't even begin to factor in the possible eventual cost of
>>> a
>>> new battery when deciding on purchasing a hybrid.
>>>
>>> Cathy
>>>
>> Let's say someone buys the car used after 5 years and the battery
>> immediately fails. Is the warranty going to cover the new owner?
>>
>> The last time I bought a battery for my 1979 Celica, it was a generic
>> Advance Auto cheapie battery. It was a 24 month battery, but it is
>> still good. It cost about $60. The toyota cost me $400 from Ebay,
>> $140 in diesel fuel to drive 1000 miles round trip to get it (it was
>> in 2000), and $50 for an "in-town" trailer rental..
>>
>> Once I got the car, I found that the motor needed freshening. I put ~
>> $800 into the motor and parts for it. I have had to spend $450 on six
>> tires so far. Replaced the brake master cylinder ($40 ebay), the
>> clutch master ($25 ebay), the transmission (brother ran it out of
>> fluid) with one from another parts car (labor only). Replaced the
>> pitman arm ($30 ebay) and the idler arm ($25 ebay).
>>
>> Total that and it's $2020. I have no idea what i've spent on gas
>> over the last 45,000 miles I've put on it in the last 5 years (didn't
>> drive it for two when i first had it), but around town it gets around
>> 18 - 20 mpg and on the road it gets 28 - 30 mpg at 75 - 80 mph all day
>> long.
>>
>> I can't understand why someone would *want* a new car..
>> Let's just say all those miles were in town, getting 20 mpg, with gas
>> at $3,00 per gallon. (although i know that more than half of the miles
>> were highway and significantly LESS than $3,00 a gallon)
>> 45,000 / 20 = 2250 gallons.
>> 2250 * 3 = $6750
>>
>> $6750 + $2020 = $8770
>>
>> 45,000 miles / $8770 = ~ 5.13 cents per mile.
>>
>> Now *THAT* is what I call an economy car. I challenge *anyone* with a
>> new car to come up with an operating cost that low.
>>
>> Stick that in your tailpipe and smoke it.
>>
>
>
From: Mike Hunter on
The comparison I suggested was for two similarly situated buyers. You are
free to or use whatever criteria your choose, or believe whatever you
choose, I could not care less.

mike

"Jeff" <kidsdoc2000(a)hotmail.com> wrote in message
news:gmpri.17004$Bb1.16487(a)trnddc02...
> Mike Hunter wrote:
>> If one wants to calculate the TRUE annual cost of ownership, one must
>> take into consideration the total cost of acquiring a vehicle, insuring,
>> maintaining, repairing and operating that vehicle and at some point the
>> replacement cost for another new vehicle.
>>
>> Assume two buyers buy exactly the same $25,000 car. One buyer is the
>> average American new car buyer who replaces their car in three to four
>> years. The other buys a new car every ten years. The average person in
>> the US drives 15,000 miles per year. For a 3, 4, and ten year old cars
>> that will 45K, 60K and 150K miles. The average deprecation in 3 years is
>> 20%, in four 30%, in ten year 95% For the purpose of calculation,
>> assume the cars have four year 60K warranties and the owners are covered
>> by equal insurance policies, at the same cost, both cars use the same
>> amount of fuel, each vehicle needs an annual state inspection at $75,
>> every owner performs all of the required normal preventive 5K
>> maintenance, that averages $50, as well as the required 15K maintenance
>> that averages $400, each has a major repair $1,500 and a new vehicle goes
>> up $1,000 a year. You can set you own average shop rate and part prices
>> to make the comparison. Assume warranty covered repairs, the 45K, 60K and
>> 150 maintenance need not be added in, since the owners will be replacing
>> the vehicle(s)
>>
>> In ten years, after they both have purchased another new car and the
>> cycle begins again, who will have spent the most money per year? Are you
>> surprised ?
>
> Only with your assumptions. For example, if I buy a new car now, in 5
> years it will be paid off. if I buy one every three years, I will always
> be paying interest.
>
> I pay a lot less in insurance that I did when my car was brand new. I
> don't need any collusion (sic). So your assumptions about insurance are
> inaccurate, too.
>
> According to this USA today article, the depreciation is 65%, on average,
> after 5 years. That's about 13% a year. So in three years, the average car
> will have decreased in value about 40% and a little over 50% in four
> (different cars depreciate at different rates). Not to mention that I will
> lose more on the value of the car in trade in, because if I trade it into
> the dealer, I will get wholesale, prices, not the retail prices that the
> retailers sell used cars for.
>
> http://www.usatoday.com/money/autos/2005-12-22-resale-usat_x.htm
>
> It is cheaper to keep an old car rather than buy a new one, most of the
> time.
>
> You have to run the numbers, of course. But you need accurate numbers.
>
> Jeff


From: Mike Hunter on
You are entitled to you own opinion but perhaps you did not notice, before
you sniped part of that post, I was referring to the AVERAGE new vehicle
buyer in the US when I said 3 to 4 years.

I am very familiar with corporate fleets, We sold thousands of vehicles to
fleets when I was Group Sales Manager for one of the largest
multi-franchised dealership groups on the east cost. Later I owned a fleet
service business that service corporate fleets, as well as government
fleets, in six eastern states.

That is how I know corporate fleets, unlike rental car companies, generally
keep the 'tools' they used in their business, cars are just one tool, for
five years or 300K WOF because of corporate deprecation tax laws. Some keep
some of them longer.

The corporations we serviced, generally, based their annual cost of
ownership on the cost of acquiring a vehicle, insuring, maintaining,
repairing and operating that vehicle and the replacement cost for another
new vehicle. If you are familiar with fleets you must have noticed they buy
more FMC vehicles than any other, and few import brands

My example was to compare two buyers of the same car, of any brand, for the
two types of buyers I referenced.

Personally, I run two cars, a 2006 and a 2007. I have been doing rather
well by trading them every other year ;)

mike


"B A R R Y" <beech23pilot(a)yahoo.com> wrote in message
news:V5pri.44$3x.38(a)newssvr25.news.prodigy.net...
> Mike Hunter wrote:
>> If one wants to calculate the TRUE annual cost of ownership, one must
>> take In ten years, after they both have purchased another new car and the
>> cycle begins again, who will have spent the most money per year? Are you
>> surprised ?
>
> If your math truly worked, major non-rental company fleets, like AT&T,
> FedEx, the US Government, etc... would replace "non-image" cars and trucks
> every 3-4 years. They don't.
>
> By non-image, I'm referring to vehicles purchase for utility, where
> overall cost is more important than aesthetic appearance.
>


From: AmFion1 on
On Jul 2, 10:21 pm, "Joe" <J...(a)dontspam.net> wrote:
> "Fred" <Use-Author-Supplied-Address-Header@[127.1]> wrote in message
>
> news:df127c62fb385876500f68f0791898d6(a)pseudo.borked.net...
>
> > Wall Street Journal
>
> > "...this [CAFE] debate is a test of who has more clout in today's
> > Democratic Congress -- the men and women who work in American
> > factories, or the affluent greens on both coasts who can afford to pay
> > a premium to own a Prius to indulge their concern about global warming."
>
> > complete article:http://curio.us/8h
>
> Yeah, that's bad, considering the Prius is a very cheap car. They should
> look at facts in these cases, that way everybody doesn't think morons are
> writing for the wall street journal..
>
> Most of the people I know drive something like a Chevy Silverado that costs
> as much as 2 Priuses.

You are the illogical reader that's blind to the big picture. The
Prius costs thousands of dollars more comparable non-hybrid autos its
size. If Congress forces such high fuel mileage ratings on the entire
fleet of new cars (large and small), the hybrid version of the Chevy
Silverado will cost thousands of dollars more the non-hybrid Chevy
Silverado.

The bottom line is this. Almost everyone is for lower cost energy
supplies with a smaller CO2 footprint. But, we will never get
something from nothing no matter how hard we wish upon a star with
federal government decrees. The Europeans and especially the Japanese
have been producing high fuel mileage cars for many years thanks to
sky high fuel taxes. In the short term, the most efficient means of
achieving a higher fuel mileage is to pass a large fuel tax and then
let the free market decide the rest. In the long term, the most
efficient means of lowering energy cost and CO2 footprint is basic
research on battery technology, solar, etc. paid for my the United
States federal government.

Blind, politically motivated, federal decrees requiring higher fuel
mileage will only decimate the American auto industry.