Friday, November 21, 2008
One Van: $9,000, Bought Used... 178,000 miles later.
Well, we made it.
Quartermain, my 1994 GMC Safari van, hit the 250,000 mile mark two days ago. (He's named after the hero of "King Solomon's Mines.")
I bought Quartermain used for $9,000, with 72,000 miles already on his odometer.
He was in good shape--I had my mechanic check him out before I bought him, since I was buying him "as is"--and he's been a solid vehicle. We've had our moments...for example, if I solemnly promise to wash and vaccum him and don't do it, he usually retaliates by flatting a tire on me, though I must say, he's always been gentleman enough to do it in my driveway or a parking lot, instead of while we're running down the road at 60 mph--but despite a few such idiosyncrasies, he's been pretty good at getting me from here to there and back again.
I, for my part, have changed his oil every 3,300 miles (it's easier to remember when an oil change is due when you do it at 10,000 miles, 13,300 miles, 16,600 miles, 20,000 miles, 23,300 miles and so forth.) I've checked his oil, transmission and anti-freeze levels on a reasonably regular basis. I changed his air filter myself once and found that I didn't like hanging upside down trying to unscrew his cowling (yep, he's that kind of van) so I had someone do it the next four or five times. We've also gone through two extra serpentine belts, changed before they snapped. (Much better idea to change before than after, believe me.)
I've had his radiator recored twice. I've just put on his third set of shocks, I've gone through perhaps four full sets of tires, replaced his starter and his compressor, and had his spark plugs and spark plug wires changed out twice. One new battery....or was it two?...I can't remember .
He currently needs some minor work on what my mechanic calls a vacuum problem with his heating and air conditioning system, the passenger power window doesn't work, (though the driver window will go up and down, though admittedly with a certain reluctance, and that's all I need) and he needs a new seat cover. Other than this, he chugs along pretty well, even with 4,000 pounds of trailer and ponies in tow. (He's rated for 6,000 lbs.) He even looks fairly good, probably because of those frequent washings.
Neither his engine nor his transmission have ever needed anything but routine maintenance. He shows no signs of rusting out. (I always wash out under the wheel wells.) His two passenger bench seats are in my closet, providing room behind the front seats to haul everything from landscape timbers to a Miniature Horse. (Cloud, my young gelding, has no problem jumping in through the side door.)
I drive him gently (see my article on "hypermiling") which is probably why his shocks, brakes, engine and transmission have lasted so long.
I mention all this just as an example of how you can buy a good used car, and by keeping up with routine maintenance and driving it with a little care, have a vehicle that will last a long, long time without major repairs. Quartermain cost me $9,000 cash some 11 years ago and I estimate repairs over the years equal around $3,000, for a total cost per year, other than routine maintenance, of about $1,110 per year. If I'd bought a similar van new, it would have cost me at least 30% more, or nearly $12,000.
Quart's original owner traded him in at 72,000 miles. Assuming he did that at similar intervals, he would have bought 3.5 vehicles by now. If he bought equivalent vans, he would have bought three so far at prices of about
or about $52,000 total, with another purchase due in a year and a half.
A car bought new can easily depreciate in value 20% the instant you drive it off the lot, plus an addtional 12% or more per year. So if Quart's original owner traded in his vans every four years and got an average of 40% of the original value, he would have received $20,800 in trade-in credit. So he would have paid $31,200 net for those three vans and driven 216,000 miles. To drive the equivalent of my 250,000 miles, he would have paid an estimated $35,880.
Of course, we haven't included financing. I didn't rack up any financing charges, since I paid cash. If we assume 6% interest charged on an average of $3,000 per year for 11 years, we need to add another $1,980 to the cost, for a grand total of $37,860.
Now you may say that there'd be fewer repair costs with new vehicles, epecially those under warranty. Fair enough; we'll deduct my $3,000 in repairs, for a comparison cost of $34,860.
So Quartermain has hauled me, my Mini, bales of hay, sheets of plywood, landscape timbers and the occasional 4,000 lbs. of trailer and ponies for a cost of less than 5 cents per mile, including repairs, but not including gas and routine maintenance.
Quart's first owner has (hypothetically) paid nearly 14 cents per mile, almost three times as much.
Quite a difference, no? But let's make it even more interesting. Let's say that I take the $34,860 extra I haven't paid for transportation during the last 11 years and, as of today, start earning 6% interest on it and do that for the next 25 years. How much would I have in 2033?
Is a "new car" smell worth over $150,000? Or is it smarter to buy a good used car, maintain it properly, drive it gently and keep it until it racks up 250,000 miles..... or more? (I'm not planning to replace Quartermain any time soon.)
You decide. It's your money.
(Note: If you just have to have that smell, allow $200 or so for getting your newly-purchased used car cleaned at a detailer until it sparkles...and ask them to finish by spraying the car with "new car" scent. I'm for anything that keeps you happy.)
P.S. For those of you who wonder why Quart is a "he"....well, I'm a she. All my cars are "guys."
My thanks to the Carnival of Money Stories for including this post in this week's carnival.