Is Our Car-Owning Strategy Kaput?

[canyonwalker]

I'm still fuming about the $4,000 maintenance repair we had to make on our car this past week— a car that at 60,xxx miles is way too low-mileage for crushing upkeep costs. It's German, so yes, maintenance is expensive, but it's not British— so it shouldn't be falling apart! If this is the new reality for owning a late-model BMW, and far from an expensive BMW, I wonder if our strategy for car ownership is now broken.

Our strategy for many of our car purchases has been:

• Buy a good-condition used car, typically a 3-year lease return with below-average miles


• This lets someone else take the big hit on initial depreciation. At 3 years many cars have lost 30% or their market value.


• At 3 years old and in good condition with low miles, the car feels basically new


• And with low-ish miles, there's still some original warranty left, in case we discover problems in the first year or two of our ownership


• Then we drive it "until the wheels fall off"— expecting to get 10 years/100,000 miles of our own use out of it, until either it starts to become too expensive to maintain (vs. the costs of buying a newer car) or we'd really enjoy a newer/nicer/better car.

We did this with a Mazda Hawk bought many years ago, driving it from 30k miles to over 130k before trading it in. At that point it wasn't even having maintenance problems; we just wanted a nicer car. Our previous BMW convertible, "Hawkgirl", we bought at 30k miles and traded in at almost 150k because she had become too costly to maintain.

I mentioned this strategy to the service advisors at the shop this week. Their reaction was, "No, no, no, you'll be better off just leasing. That way you'll always have a new car and no repair bills. Trade it in before stuff starts breaking."

Oookay, but this is the 2020s, not the 1960s. 60k is not "high mileage" anymore! People expect cars to last well over 100k when taken care of— and routinely they do! Or did.

The notion of leasing cars and trading from one lease to the next is attractive in the sense of always having a new car and never having maintenance bills. But it also means stepping onto the treadmill of always having car payments. With average car payments running toward $1,000/month now— and 2x that if we're leasing 2 cars for 2 independent adults— that's a costly treadmill I do not care to run on!

Comments

Yes ...

[ysabetwordsmith]

People don't make things like they used to. Often they make disposable rather than repairable things. Planned obsolescence is a problem.

So is lack of real ownership. Yes, everything is trending toward "you don't own anything, you rent / lease / subscribe." Exactly as you pointed out, this is expensive. A worse issue is that it runs up the fixed expenses of a household, so you can't easily reduce costs when money gets tight.

[crazy_yet_fun]

We have the same car strategy. We have pretty much buy used with low mileage, and pay off as soon as possible. There is no better feeling (almost) than having paid off cars. We are lucky enough to get a bonus every year, and last year we paid off both of the cars. I have had my Acura for 3 years, and she only has 30-something thousand miles. Husband actually went rogue and bought a new truck, and he is racking up miles on it with traveling for his job, but we figure the truck will get pretty close to 300,000 miles on it. Our last truck had 330,000 when we sold it.

Of course there will alway be the maintenance issue. I took mine in for the whatever-mile tune up and it cost $750. But in my mind, that’s less than two car payments, and if we do that every year, it’s a pretty good deal. So, in my view, your strategy is a good one. Although it is nice to get a new(ish) car once in a while.

As Jordan Davis says in his song “What My World Spins Around” (sorry if you hate country music) there’s nothing like the feeling of driving for the first time with the windows down in a paid-up truck. Haha. Or car. :)

[canyonwalker]

We had a $1,000/month payment on this car-- and that was with a 0.9% APR you can't get close to anymore. It wasn't painful in our budget but still it felt good to pay off the loan 21 months ago. Our other vehicle, a 2011 Nissan Xterra 4x4 we bought new, has been paid off for years. I'd been planning to avoid car payments for at least another two years. But if this car is going to start costing $5k/year for maintenance then buying a new car starts to become smarter financial play....

[crazy_yet_fun]

5K a month is ridiculous. I’d be out looking at cars! Haha

[some_other_dave]

I think he said $5K per year, not per month. ;-)

I'd still be OK with $5K per year. I may soon get a chance to put my money (literally!) where my mouth is, though. My wife recently said that first gear in our primary California car was very difficult to select. That could, worst case, mean a new or rebuilt transmission is in my future....

[crazy_yet_fun]

I sometimes don’t proofread my comments, which is often a mistake. Haha
$5k per month is absurd, of course.

[crazy_yet_fun]

And also, I hope you don’t have to go through some costly repairs.

I sometimes don’t finish my comments. ;)

[canyonwalker]

I presume you're talking about Fenimore? Do you consider that a commodity car or a collector car like a few of your others?

[some_other_dave]

I think of him as a commodity car. I know there are MINI enthusiasts that really like the R56 platform, but I think most of those would still value the top of the range John Cooper Works version the highest, and the regular "Justa" Cooper as the lowest. (Of the US models; other markets got the MINI ONE that was even lower-spec than the Cooper.)