I have done my research and narrowed it down to just two models (both are crossovers). And between these two, there is very little difference except for gas mileage. One of them has superior gas mileage, and with gas being so expensive these days, I will go for the model that saves me the most on gas; all other things being equal.
But there is one issue. The model I am eying is new. In fact, the only model available is 2013. So the only option is to buy brand new, as it is virtually impossible to buy used. Which means I am forced to pay some $1900 for freight and PDI.
Why it does makes sense to buy a new car in this case:
But it still makes sense to buy a new car in this case. Why? Having done my homework on this, this car will save me a lot in the long term. And in my case, long term really is long term. On average, I like to own a car for at least 5 years or more. And with this being a new car, I plan to keep it for a lot longer, so potential for saving in the long term is real.
Compared to my current vehicle, the new car has a gas tank that is about 7 liters smaller. Which means every fill-up will save me about $9, given today’s gas prices. But the real savings are in the actual performance of the car. To begin with, it is a 4 cylinder, newly-engineered engine that has already garnered so much attention and good feedback on its efficiency. Comparing the engine on this CUV to my current vehicle, I could save an estimated $15-20 per fill-up. At about 5 to 6 fill-ups a months, I could be looking at more than $110 in gas savings a month.
- Insurance costs:
Having called my insurance broker about this new model already, I was shocked to find out that it will cost me about $25 less per month to insure this car, for the exact same coverage.
- Maintenance Costs:
Due to the high mileage on my current car, I am forced to use ‘High Mileage’ grade when changing my oil, and this is about $10 more than regular oil. Besides that, due to the old age of the car, I have to do frequent maintenance on it, some of which cost in the hundreds. On average, this is close to $100 or more a month.
- Resale value:
While it is true that new cars lose a big portion of their value, just shortly after driving them off the lot, the car I have in mind is of a very reputable manufacturer and will not lose much value even after many years of driving. This was a big part of my decision on which car to choose. Its residual value will remain high even years of driving it (assuming the mileage is not too high)
- Peace of Mind:
With a new car, you get peace of mind knowing that you are covered, for years, should something goes wrong with the car. And as part of the warranty, you also get the courtesy of free road side assistance, something you may need in the future in an emergency.
- Getting something out of the current car:
Given my current mileage, I am still able to get some decent offers from interested buyers for my current car. But once my mileage hits 300K or more, it will be very hard to get anything significant for it. So now would be just the right timing to sell it or trade it in.
Based on all of this, you can see my case for a new car. The savings alone from reduced insurance, gas and maintenance costs will add up to well over $200 a month, which in and of itself will pay for the monthly financing amount. And after the car has been paid off, I will continue to save more and more money, especially on gas!
Buying a new car may not make sense in most cases, but in a rare case like this and after doing your homework and research, it may very well be.