How to get into a New Car That’s Just Right for You

Thursday, August 30, 2018

We all face it, every so often.  It’s costing us more to own our old car than it is worth.  You may want to try to squeeze a few more miles out of that old junker, but the returns, as they say, are diminishing.  

The fact is: buying a new OEM fender for a 20-year-old Toyota is more expensive than buying an OEM fender for a 3-year-old Toyota, because?  It costs automakers and their dealers a lot of money to maintain the parts infrastructure for storage and distribution of those spare parts.  Holding parts for models past seven years old is generally not profitable, so older parts for older cars descend into the netherworld of middlemen who store these parts in various, even bizarre ways, and they all take a cut that adds to the price of the part once it reaches the consumer.

So it makes sense to trade in car with bad engine when replacing that engine would cost more than the car is worth.  The real question becomes; should I buy a new car or should I look for a bargain with a used car?  And there are several ways to consider this age-old conundrum.

The Sort of New Car

There’s the old adage that says when you buy a used car, you are buying someone else’s problem.  And maybe you are.  But it very well might not be a mechanical problem.

Cars depreciate faster than any other common appliance that you can buy.  A new car drops at least 20% in value the minute you sign on the dotted line and drive it off the lot.  If you turned that car around and drove it right back on the dealer’s lot to trade it in for another car, with only one or two miles on it, it would be worth considerably less than you paid for it.

Why not take advantage of this situation?  Of course, new car buyers don’t drive cars off dealer’s lots and drive them right back on to trade in on another car – but they do miss installment payments.  

The fates can work in strange ways.  Like the job that seemed so secure when you signed up for 5-years of installment payments on that new car – can disappear as fast as you can say leveraged buy-out.  And when that happens and the severance pay period is only a couple of months, the first things to get cut are those high new car monthly payments.

So agents for the lender, who loaned the buyer the money to purchase the car, take the car back.  A non-judicial procedure commonly known as being repossessed, or “repo’d”, as they say in the car business.   Usually the repo’d car ends up at a car auction. 

This is a good place to try and buy a used car with very few miles on it.  The vehicle may be dirty, neglected and in visually poor condition, but if there are less than 5000-miles on the clock it is most likely, mechanically, sound.  And remember, all vehicles sold in the U.S. come with a new car warranty, normally 3-years or 36-thousand mile whichever comes first. 

As long as the auctioneer certifies that the car does not have a salvage title, that is a title that has been re-applied to the vehicle because an insurance company wrote it off as a total loss, usually due to a catastrophic accident, then the car’s manufacturer is obliged to fix anything that goes wrong with the car, mechanically, during the warranty interval – no matter who owns, or has owned, the car.

If you can’t get to a car auction, the next best thing, these days, is to use one of the many car purchasing websites, like Carmax or Autotrader, to scout for cars across the country.  These websites enable you to implement personal parameters in your car search, and the best one you can use is the “under 15,000 miles” restriction.

Again, as long as the car does not have a salvage title, then the auto’s manufacturer is responsible for repairing anything that is wrong with this car, mechanically.  So there is virtually no risk in buying a low-mileage used car like this and the savings on the purchase price are considerable.

Only New Will Do

But, there can come a time in one’s life when you want to treat yourself to the experience of driving a brand-new automobile off a dealer’s lot.  You want to smell that new-car fragrance, absorb the gleam of the freshly-minted sheet metal and chrome, and experience the feel of tautness and control that all-new parts convey to a driver through that untouched steering wheel.

If so, let price and conscientiousness be damned.  Go for it.

Melandria's Musings

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