September 6, 2019 -
Are Vehicles Disposable?
September 6, 2019
In the society we live in today, many items are treated as completely disposable. We’ve gone so far as to even treat vehicles as a disposable item. The question is should we be doing this? Are vehicles disposable? We take a look at this question, and try and come to an answer from multiple different angles below.
One important consideration as to whether a vehicle should be considered disposable will be the impact on the environment the production of a new vehicle has over repairing a used vehicle. The truth is, a used car with good fuel economy has a better environmental impact than buying a brand new car with even better fuel economy. The reason is that the manufacturing and shipping of a new vehicle has a significant impact on the environment in the form of usage of raw materials as well as carbon dioxide emissions.
The True Cost of Buying Used vs. New
This is the real question on everyone’s mind: what costs more—buying used, or buying new? The basic argument on the one side is that a new vehicle costs more up-front but will have much less maintenance needs than a used vehicle. Whereas a used vehicle will cost less to purchase, but the maintenance needs will be much more. So which answer is the real truth?
Vehicle Maintenance Costs
The average vehicle maintenance cost, according to Kelly Blue Book, is 11.2 cents per mile. This means, regardless if the vehicle is new or used you will likely spend this amount of money depending on your particular driving habits. Let’s say you drive about 15,000 miles per year, your yearly maintenance would be $1,680. So after 5 years, you’ll be spending $8,400 on average for vehicle maintenance costs; regardless if your vehicle is new or used.
New Vehicle Depreciation
With a new vehicle, one commonly overlooked factor is the idea of vehicle depreciation. Depreciation is, on average, at a rate of 22.5%. So on a $37,185 vehicle, that’s $8,367 lost in the first year. To look at this a different way, you’re paying just south of $8,400 to have the newest model. That amount of money in and of itself would pay for 5 years of maintenance on a used car.
What About Loan Interest?
So, depreciation aside, the interest on your loan will also be a factor. Using just some basic numbers, the valuation analysts at Kelley Blue Book reported the estimated average transaction price for a light vehicle in the United States was $37,185 in May 2019, the interest you would pay on a 60 month loan at 4.0% (the average 2019 vehicle loan rate, with good credit) would be in the ball-park of $3,900 over 5 years. Add this to the fact that you’re also making monthly payments of $685, and the $7,000 maintenance over 5 years is starting to sound a lot better. https://www.kbb.com/new-cars/5-year-cost-to-own-awards/best-cto-mid-size-car/
So Which Costs More?
Using the numbers above, it seems that maintaining a used vehicle for 5 years will be able to save you a significant amount of money when compared to purchasing a new vehicle. The only down-side most people face will be not having the newest model. That said, even purchasing a 3 or 5 year old model will save you a significant amount of money on the sticker price and still give you the newest technology you crave.
Regular Vehicle Maintenance
If you do end up purchasing a used vehicle, one important aspect to ensuring that you get the most value out of your car is to partner with an experienced Davidsonville, MD mechanic. An experienced mechanic will be able to keep your vehicle on the road through proper and regular vehicle maintenance.
Choisser Import Auto Services is a Davidsonville, MD auto service center specializing in the repair and maintenance of Acura, Honda, Lexus, and Toyota vehicles. For more information on our auto repair services, or to schedule an appointment, give Choisser a call today at 410-867-2122 or fill out the form on our website today!
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