Trading Down

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A reader asked about “trading down” – lowering their car-related expenses (especially repair and maintenance expenses) by trading in their current vehicle (a luxury-brand vehicle) and rather than digging themselves a new and deeper hole by using the proceeds as partial payment on another such, using the proceeds from the sale of their old vehicle to buy something that costs less.

Both to buy (outright, no payments) and to maintain.gomez-pic

As Gomez Addams used to say: That’s a capital idea, old man!

Cars are not investments.

They are depreciating consumer appliances.

And the amount of money you will lose on your “investment” is usually proportionate to the original new car purchase price. The higher it is, the worse it will be.

Luxury brand cars are notorious examples. They cost the most to buy when new and are worth the least – proportionately – after five or six years, about the length of the typical new car loan.

For example, the base price of a new (2017) BMW 7 Series sedan is $85,295. The depreciated average retail value of a 2012 BMW 7 today is about $35,000.

When it was new, its base price was $71,000.

Over the course of just five years, the car has lost about half its original value. Which – to a great extent – was based on its being new. The “latest” thing. As soon as you drive it off the lot, it no longer is. After a couple of years, its snob appeal has faded like Madonna’s youth.old-madonna

And its desirability (and value) accordingly.

That is an “investment” you don’t want to make.

And, it doesn’t take into account a peripheral issue – the cost to repair and maintain the car.

This is a factor with any car but luxury cars are – once again – notoriously awful in this respect. Post warranty, they are infamous for being money pits. It’s the nature of the beast. To make their case for your dollars when they are new, luxury cars beckon with lots of gadgets not generally found in lower-priced cars. These gadgets (for example, the “iDrive” mouse controller input and hands-free gesture control in the new BMW 7) will impress your friends, but can end up costing you a fortune when they fail.depreciation-pic

Pretty much everything is more expensive when it comes to luxury car repairs and maintenance, even basic things like oil and filter changes. High-cost synthetic oil is often mandatory, as an example – or the “minor” repair involves a very expensive part and very expensive dealer hourly labor rates.

Because of “proprietary” software – and the “proprietary” diagnostic machines necessary to access the car’s computer (ECU) lower-cost independent repair shops sometimes cannot work on some of these high-end cars. You have to take it to the dealer for service – or a shop that has the necessary equipment, which they have to lay out a bunch of money to acquire.

Which they earn back by charging you.bmw-7-pic

The point being, it’s perfectly fine to buy a higher-end car as a treat for yourself – like a dinner at the best restaurant in town. Just don’t deceive yourself about the financial realities of this transaction.

Getting back to trading down.

It’s a way to triage the damage done to your bottom line.

Sell the car and take what you get to buy something else that costs less.

Instead of acquiring more debt, get rid of debt.

You can also greatly reduce repair and maintenance costs this way. By not buying another luxury-brand car.

This does not mean you will be slumming it.

Far from it.

While it is true that a new luxury car like the BMW 7 discussed earlier will have (or offer) technological gimcracks like gesture control (wave your hand dismissively to end a phone call without actually touching any control) most of the amenities that used to be exclusive to high-end cars and which defined “luxury” are now pretty common in much more reasonably priced cars. For example, electronic climate control, heated and cooled seats, heated steering wheels, top-drawer audio systems, panorama (full roof length) sunroofs, really nice leather and real wood trim… these things can be found in cars priced in the $35k ballpark… brand new.16-mazda6-cabin

Have a look at this pic of the current (2016) Mazda6 sedan’s interior. Does it look low-rent to you? This car costs less than $30k… brand new.

Even if the thing depreciates by 50 percent over the next 5-6 years, you’ve only lost about $17k. Or about half what you would have lost had you bought a new BMW 7.

And the new $35k car probably won’t lose half its value over the next 5-6 years. In part because its value is not so tied to its newness, as is the case with luxury-brand cars. It will still depreciate, but not as shockingly.

And it should cost you less to repair and maintain – because repair and maintenance costs are a selling point when it comes to normal, everyday cars. They are hardly even a consideration when it comes to luxury cars.

As opposed to the roster of gadgets.depreciation-2

Also, the nature of the beast. The normal car will have – usually – have simpler systems, less complex (and so expensive to fix/replace) components. Most shops – including independent repair shops – will have the diagnostic equipment needed to properly service the thing, too.

So you won’t have to go to the dealership for service.

You won’t be driving a hooptie.

And you’ll have money in your pocket instead of the finance company’s pocket.

That’s an investment worth making.

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53 COMMENTS

  1. Not sure where else to post this since I can’t find the question thread I initially submitted to Eric.

    I just wanted to let Eric know that thanks to his advice on here and on a few other review articles, I made a pretty much even trade on my 2010 Audi Q7 for a new 2016 Subaru Crosstrek 2.0iPremium with the 5-speed manual transmission, as recommended.

    I probably could have gotten a small amount of money back from my trade in but decided to upgrade to premium speakers (I got used to the Bang and Olefsun system in my Audi!).

    The Audi was in fair condition so it didn’t command the high end of the KBB value. After getting 2 dealer quotes that were pretty much identical plus the research I did, I thought I got a fair trade in value and am happy to own a new vehicle, under warranty, with better gas mileage and cheaper insurance as well!

    Thanks again, Eric!

  2. Other than luxury vs. other vehicles and new vs. used the most important issue is quality/reliability. All my new GM vehicles became repair hobbies, while my most recent new vehicle purchase, a 2012 RAV4 V6, – has had zero defects, or returned to a dealer, in 5 years. All those “scary” electronic gadgets are functioning fine. Figuring repair labor costs (mine mostly) on past GM purchases, my RAV4 could disintegrate tomorrow and I’d still be ahead.

    “Luxury brand cars are notorious examples.” – A Lexus may not make financial sense but having a “prestigious” vehicle that doesn’t make you look like a fool (Cadillac?), in trips to the dealer, is worth a lot to those who can afford it. Toyota and Honda decimated American auto manufactures by emphasizing superior engineering over marketing. Quality and reliability is further reflected in resale value.

  3. I spent a few decades selling new and used cars. Buyers asked me all the time how much their new (or new to them) vehicle will be worth some years into the future. I always told everyone the exact same thing. . . “The more you spend now, the more you will lose later – so if you want to lose less, spend less.” Simple common sense; and then I’d watch (and aid) in one buyer after another bury themselves in their new purchase!

  4. This is the dilemma I face: throw away or keep an old car. My 2000 e39 BMW is structurally sound. Great engine and transmission. Interior is still quite nice.

    The car is worth maybe $3000 tops in a private sale, probably more like $2000.

    It has a slow oil leak, somewhere near the pan, that likely will cost $1000 to pull apart, find, and fix. So I just live with a burning oil smell sometimes (leaking onto hot engine parts). The level never seems to fall between changes. A lot of the electronics have intermittent niggling issues. It also has some creeping rust, and a quality body shop wants $1800 to redo (and match paint for) the entire rear quarter panel.

    I’ve even considered a nice $5K paint job and re-carpeting the interior, which would give me a “new” feeling luxury car. But the rational approach simply is to drive it until it falls apart, or until some >$1500 repair becomes unavoidable. At that point I give it to charity and claim an aggressive value on the tax receipt.

    • Hi Jeff,

      The leak is likely either the pan gasket or (worse) a main seal. It can be a big job, depending on the car. Sometimes, you can get the pan off/access the bottom end without pulling the engine.

      That said, if the leak is minor – defined (by me) as just a few drops after sitting overnight – I’d be inclined to leave it. But if the leak involves puddles, or it is coming out under pressure, it’s obviously an urgent fix.

      It’s kind of like a prostate issue … watchful waiting can be wiser than surgery…

    • Jeff-

      I’ve used AT-205 with some success on high mileage vehicles with slow leaks, do a youtube search and you’ll come up with a lot of video reviews on it…you can get it off Amazon for $10(reviews there are really good as well)- never hurts to try to something cheap to see if it works.

      Best,

      Nick

  5. Theres a dealer around here that charges almost as much for very nice 1-2 year old cars as for new ones ,I told the sales Lady ,no thanks .

    • I know a Mercedes mechanic who recommends never owning their active suspension after the warranty is over. Fixing an active suspension usually involves forking over $1500, minimum. He sold his wife’s Mercedes when it hit 120k miles. The Mercedes automatic transmissions apparently almost always need a rebuild at 150k and he doesn’t do rebuilds.

      He drives a 5 cylinder Volvo with a manual tranny with 250k on the clock. Says something right there.

      I am very leery of the piles of gee-whiz electronics in the new cars. I can see that the aftermarket world is going to get much bigger as electronic parts will go obsolete long before a vehicle wears out.

  6. So great you wrote this article, I just about a 1997 Volvo 850glt(low pressure turbo 5 cylinder) wagon with 98k miles for $2000 off of ebay last month…it’s in decent shape too. Just some clear coat peeling and some minor interior things but I’ve been daily driving it now for a couple of months with no problem. I sold my 2007 HHR and moved down to the Volvo to save on taxes and insurance. Mission accomplished! (plus, it’s faster than the HHR and seems built better)

    Now I own a 96″ roadmaster wagon w/ lt1 engine(wife/kids), my 97 volvo, and a 93 GMC conversion van for camping & towing- all stuff that I can wrench on if I want and is cheap to maintain. (all of it is off the shelf OBD stuff)

    • Nick, that ’96 Roadmaster is just about the ideal family hauler. It’s hugely roomy and its V8/RWD layout is simple and durable. It’s tragic that such cars are now for-the-rich-only.

      • Rear facing seats like the wagon’s of old(and Volvo’s), which is very handy for separating four kids so they aren’t beating on each other and driving me crazy when I’m driving.

      • The shits of having a vehicle that old is insurance, or lack thereof. It won’t keep me from staying with that age vehicle but it sucks when it gets damaged. A good old baseball size west Tx. hail job and it’s all yours, even with no glass and every panel beat to crap. We get those things. I learned to identify the bad ones by vision but now with a smart phone I know it’s coming a long way off. I’ve run all over the country to avoid them. Get far enough ahead of one and find a road ninety degrees to it’s path and finally get it around you and then it can be a long way home. Beats hell out of a ruined vehicle though.

  7. In 1970, I purchased a 1958 Coupe de Ville with very low miles for a few hundred dollars. A creampuff Cadillac for nearly nothing! My father was not impressed and told me I was young and stupid. Rich enough to buy it but too poor to own it. Truer words were seldom spoken.

    It should have been parked in the barn and mothballed for forty years. I’d be a far richer man today if I’d never driven that Cadillac.

  8. Some people can and will pay for the prestige of driving an upmarket car. If you’re high enough up the food chain that you can easily afford that prestige, a luxury car may be a sensible proposition.

    Prestige is an intangible, subjective value. The electronic upscale electronic gizmos are often as not detrimental to the driving experience. They’re just not worth it.

    Of course if you’re getting extremely high performance included, that changes the equation again.

    Say what you will, Turbo Porsche 911s hold their value quite well….and maintenance schedules be damned. 🙂

    • It’s not just the turbo 911s that hold their value.
      I was helping my boss move (because divorce) and his neighbors were trying to lowball him out of his 1980 911sc. The car had been sitting for several years and he couldn’t seem to get it started. The one neigbor offers him $10k for it, but no sale. I manage to get it fired up (my boss is a car noob) and back it out of the garage and the offer immediately jumps to $15k (still no sale).
      This made me curious so i did some checking later and found a similar car on ebay that had been wrecked to the point it was just a parts car IMO and they still were asking $12k for it…
      since then my son in law has detailed the car and I fixed a nasty vacuum leak – the CIS is a PITA to work on with the motor in the car and I was a little surprised to see that the plastic air box is connected to the runners with rubber sleeves and hose clamps.
      The car runs much better now and is surprisingly quick for only 180hp. Going to attempt a little dragstrip tuning of it before the track closes for the season.

      • Hi DirtyBob!

        Porsches are kind of exceptional. Make that a lot exceptional. In some ways, the older (even if less powerful) models are more desirable than the new/newer ones.

        Air-cooled engines, for instance, have a strong emotional appeal to freaks like us! 🙂

        • The more I drive that car the more I like it.
          It has been set up for track use so it was lowered a bit, has a roll cage/6 point harness, front seats are aftermarket racing seats, the ac has been deleted, it has headers (IIRC the porsche guys call them heat exchangers), and euro spec cam(s).
          The oil (16 quart+ dry sump – nice!) does a fair bit of cooling too, the whole setup looks to be pretty durable and it beats the hell out of something like a miata as a ‘fun’ car.
          I don’t think it would be overly difficult to get more power out of the 3.0L motor but it looks to be cheaper to build a big block chevy than a 6 cyl. porsche lol. Pistons I looked at were $5k 😯

          • I love older 911s!

            They were set up for people who knew how to drive. Not that the new ones aren’t incredibly capable. But they are also set up to appeal to the poseur-guido types and laden with over-the-top idiot-proofing that gets in the way of The Experience.

          • “…but it looks to be cheaper to build a big block chevy…”

            As soon as you fall into the economic “trap” of horsepower per dollar = good value, you often kill the essence of what makes the car special.

            As good a “value” an LT/LS1 is, I will forever be a 993 fan til the day I die, 4 gallon oil changes and all.

            • I wasn’t going there (hp/$$) so much as my boss asked my opinion on adding power. After a little research (and a bit of sticker shock) I saw that swapping to a 3.2L seems like a popular budget choice but my advice was to leave the motor alone and enjoy it for now.

          • I’ll take my 90 chassis Miata w/92 engine any day over a Porsche. Top needs replace(I’ve got one, just haven’t put it on), no a/c, manual rack and a dent in the left front fender. I can take it anywhere and not worry about scratches or some knucklehead wanting to steal it. Bops around just great. I can do all the work on it myself (including engine & trans rebuilds and parts are cheap, by Porsche standards, and it’s easy to work on and there are so many aftermarket things you can do it boggles the mind.

  9. Newcars today are largely crap unless you spend at least $40k because inflation has caused them to cut corners and the EPA has made them way more.

    Case in point CVT transmissions. They’re crap that won’t last 80k but almost every new car under $40k comes with one.

    Then there is front wheel drive and the horrible suspension and alignment issues along with torque steer.

    Perfect example is a wrx. This is an imprezza that costs $20k . It’s less than a civic. But to get the same sized rotors proportionately to weight as my 1992 civic you have to spend $32k. Sure the wrx checks all of the boxes above but you’re buying less than a civic for $40k optioned out to get a car that doesn’t suck.

    For that money you might as well buy a BMW 3.28i xdrive which is a better car with better quality.

    • Hi James,

      Modern cars are analogous to consumer electronics. They are basically throw-aways. They are either not cost-effective to fix after a certain point or they become obsolete, insofar as not being the “latest” things.

      Of course this was also true in the past. A car accrued miles, eventually wore out. But the cost to keep an older car operational in its dotage was less than now. And what was typical then was the drivetrain (or body) wore out (or rotted out). Modern cars typically remain mechanically and structurally sound for a very long time. But once their electronics begin to fritz out, they begin to nickel and dime you to death with problems. In some cases, what would have been a “fixable failure” in the past is today good reason to just throw the car away.

      Example: I know a guy who owns a recent-vintage VW equipped with the DSG transmission. It failed. The car itself is in good condition, including the engine. But the replacement cost of the DSG (in the neighborhood of $5,000) is too high relative to the value of the car itself. It doesn’t make economic sense to replace the DSG, so the car gets thrown away.

      Contrariwise, a pre-modern car (I’ll use my ’76 Trans-Am as an example) has a transmission that costs less then $1,000 to replace. Even if the car itself is only worth $5k it’s still worth replacing the transmission if the rest of the car is sound.

      The other thing is the Pace of Change.

      What’s “new” today in terms of technology (gadgetry, especially) is looking pretty long in the tooth after as little as five years. Like consumer electronics, the car you buy today will seem very out of date in a very short time. There won’t be anything wrong with, but it will seem “old.”

      Like my Mac laptop, for instance.

      It still works fine. But the “white brick” looks ancient compared with the new thin-line Macbooks and iPads. There is a powerful rip tide pressuring people to constantly (and ever-more-frequently, it seems) upgrade to the Newest and Latest thing.

      • eric, I learned pretty young to not finance much of a vehicle. That changed later in life to not finance any of a vehicle. Well, some might say, it’s going to be hard to buy that new pickup you want(if they have a clue about my finances)if you don’t pay it out. i’d agree and that’s the reason no matter how great a new pickup might be, i can’t work a deal to pay it off in a year with take exemptions or simply money made. If I have $60K in my pocket at the end of the year I can find something that I can invest in that will make me money. I paid out for 3 vehicles in my life, one because it was so cheap I could write it off in taxes but not like things were when you could write off the entire cost of a truck based vehicle in one year on taxes.

        I use the old saw I used in stock investment, one you’ll hear from every seasoned investor: Never invest money in the stock market you can’t afford to lose. I now live by it…in every way. If I found something I really needed and was sure I could pay for it in three payments in three months, I’d do it….reluctantly. It’s not worth it to me to impress anyone with what I drive. I get left alone and don’t have anybody sell me anything just by looking at what I drive. Those vehicles rarely get broken into also.

        I know a guy who won the lotto. He’d never had a decent vehicle and drove a farmers pickup he worked for every day and had never had one himself. Once he got the money, he went to the nearest GM dealer and bought the most expensive Chevy pickup he could find, crewcab, diesel, all the whistles and bells. Since he had no vehicle he had no insurance agent that would write a policy after he had an accident should one occur before he could get insurance. He got soused(evidently didn’t take too much) and ran that thing up a long guard rail. Most guard rails in Tx. have the last section twisted and staked to the ground so it won’t kill you if you hit one head on. He was going fast enough it ripped the driveline to crap, oil pan, driveshafts, transmission, rear end and totaled the front and bent the body panels all the way back. It was one of those finds in a junk yard you get to rebuild the interior of your vehicle with maybe a good endgate, mirrors, windshield and glass. I’m sure he was able to sell what was left for more than what it cost to to get it towed but not to pay off the costs of his DWI or pay the state for road damage The DWI was the only free ride he got that day.

        Those who knew him just shook their head. His payout per year on the lotto was less than $40,000 so he ended up with an old pickup and no more money than he’d have had(less, after DWI costs) had he not won the lotto. I’m’ sure he looked forward to next years lotto payout.

      • eric, I learned pretty young to not finance much of a vehicle. That changed later in life to not finance any of a vehicle. Well, some might say, it’s going to be hard to buy that new pickup you want(if they have a clue about my finances)if you don’t pay it out. i’d agree and that’s the reason no matter how great a new pickup might be, I can’t work a deal to pay it off in a year with tax exemptions or simply money made. If I have $60K in my pocket at the end of the year I can find something that I can invest in that will make me money. I paid out for 3 vehicles in my life, one because it was so cheap I could write it off in taxes but not like things were when you could write off the entire cost of a truck based vehicle in one year on taxes.

        I use the old saw I used in stock investment, one you’ll hear from every seasoned investor: Never invest money in the stock market you can’t afford to lose. I now live by it…in every way. If I found something I really needed and was sure I could pay for it in three payments in three months, I’d do it….reluctantly. It’s not worth it to me to impress anyone with what I drive. I get left alone and don’t have anybody sell me anything just by looking at what I drive. Those vehicles rarely get broken into also.

        I know a guy who won the lotto. He’d never had a decent vehicle and drove a farmers pickup he worked for every day and had never had one himself. Once he got the money, he went to the nearest GM dealer and bought the most expensive Chevy pickup he could find, crewcab, diesel, all the whistles and bells. Since he had no vehicle he had no insurance agent that would write a policy after he had an accident should one occur before he could get insurance. He got soused(evidently didn’t take too much) and ran that thing up a long guard rail. Most guard rails in Tx. have the last section twisted and staked to the ground so it won’t kill you if you hit one head on. He was going fast enough it ripped the driveline to crap, oil pan, driveshafts, transmission, rear end and totaled the front and bent the body panels all the way back. It was one of those finds in a junk yard you get to rebuild the interior of your vehicle with maybe a good endgate, mirrors, windshield and glass. I’m sure he was able to sell what was left for more than what it cost to to get it towed but not to pay off the costs of his DWI or pay the state for road damage The DWI was the only free ride he got that day.

        Those who knew him just shook their head. His payout per year on the lotto was less than $40,000 so he ended up with an old pickup and no more money than he’d have had(less, after DWI costs) had he not won the lotto. I’m’ sure he looked forward to next years lotto payout.

      • Ah the famous DSG! It used to be that these were irreparable. There were no spare components available ex-factory and even if you could swap parts out of another transmission (making one goodie out of two or more sickies) there was the problem that you’d end up wrecking the housing getting the box apart (a bearing had a snap-ring on the wrong side- inaccessible damn bastard thing it was). Now there is a puller you can get for the job and the DSG turns out to not to be particularly difficult to rebuild.

        It appears to me that the guys who designed this thing originally sought to force you to buy a whole new unit rather than attempt repairs. I let the importer know exactly what I thought about this state of affairs when I had a friend who had one let her down. She’d have needed NZ$8,000 just for replacement DSG box (“remanufactured from factory”) and at least another 2 to 3k in labour. In the end I yanked the entire powertrain and stuffed it full of Aussie reworked Japanese niceness (instead of the Audi turbo-four cylinder affair, now it has Toyota V-6 with a Aussie supercharger kit on the top and a lot more power and performance). At 330bhp that is likely a bit much for front wheel drive but I asked her not to be too crazy with it. She is a decent sort and doesn’t mind swapping the gears and operating the clutch herself. So far as I know, aside from Stacey’s car, there are another two Audi TT cars which have had heart transplants hereabouts.

        More recently you have been able to get DSG parts and proper support. It’s about time, although I am coming to the conclusion that heart transplants are a superior way to go. Teach the damn greedy idiot poncey manufacturers a lesson in respect (AND make a better car in the process- show them what they OUGHT to be building). Oh yes, I have done the V-8 into 911 conversion. Done right the resulting hybrid does make for an outstanding drive.

        Last point. I am tired of hearing people say that a car is “uneconomic” to repair if the cost of a repair approaches or exceeds the residual price of the car or the price the owner purchased it for. Case in point. A colleague at work got a BMW 7-series sedan. It had a V-12 with automatic transmission in it. When he had a transmission failure he concluded the car was “uneconomic to repair” since he’d purchased the whole car for NZ$20,000 second hand and it was now only worth $10,000 as a runner (much less with a faulty transmission). I told him to either swap out the transmission for another or adapt something not stock BMW to to the job instead. But no! So the next owner gets it at “parts car” price and sticks some US manufactured manual transmission in there. He reworked the engine some, put a Link management system on board, painted it and put some nice rubber on it. Done! Now my colleague is whining like a failing gearwheel about how he was ripped-off. Moron!

        If the car is basically sound and has a failure, remember it is still the same car as before (in the case of the BMW 7-series it is still the same $130k luxo-barge as previously, just the people don’t want to pay the 130k for it any more, but the car remains exactly the same car as it was before). It has the same utility, capability, style and performance. It just has a broken part. If the snobbery of the manufacturer is such that you can’t easily do the repair, then rip the original bits out and adapt up something better. In the long run you get to keep YOUR car and you make it more yours. Also, assuming you have not borrowed to buy it, then you end up saving a lot of money for your luxury or performance car. The BMW 7-series was NZ$1,400 to purchase as a parts car, exotic US transmission was NZ$4,500, assorted bracketry, pedal box and the like was sub $500 and LINK was ~$3,000 by the time everything was fully sorted- then the new owner started going to town on appearance and performance since he has such a good base from which to build. To buy a new BMW of similar performance and ability he’d need well over NZ$150k. Now borrowing and servicing THAT would indeed be uneconomic. Funnily enough, the people who take that route are exactly the ones lecturing me and my associates about economics. Morons!

        Si

  10. If I ever go with a high end vehicle again it will be a 2 year lease. Any longer and you start running into the maintenance schedule.

  11. I never traded up in the first place! Being an indentured servant to a bank for years in order to purchase a car is not an appealing prospect.

    It costs very little for me to keep my ‘clunker’ on the road. I do nearly all my own maintenance and repairs though. The economics of driving an older vehicle does change pretty drastically if you have to rely on a mechanic every time some little (or big) thing goes wrong. It also helps to have more than one vehicle so you have an alternate when your main ride is down for repairs.

    • Exactly the right approach to have. I do this and recommend it. Also you get to improve your ride over time with new features and performance.

  12. I remember reading Consumer Reports several years ago. I know, not always the most reliable source, but usually not total BS.
    An article about ‘Cost of Ownership” listed Volvo as higher than average. When it was pointed out that their own reviews showed Volvo as high in reliability, they said “It may not need repairs as often, but when it does, they cost more.” Or words to that effect.

    • They always hated Volvo. I have owned I think six Volvos from a 1979 245 to a 2001 XC70. The 240s are still among the simplest and most reliable cars I’ve ever owned. But Volvo, like a lot of them, went full luxury, gizmo-crazy. Their wagons (which I loved), got too nice and too small for my needs. The technology definitely added to the upkeep (not to mention the hinky viscous coupling on the XC70).

      The new ones are approaching $80K. No thanks. I loved them back in the day, but they are no different now than Audi, MB and BMW.

      • I did an S60 (4 door sedan, 2.9 straight 6) brakes once. Front calipers, rotors, pads & fluid $1,100…parts only.

        They are lovely things to ride in, but the parts price is really insane on them.

        • A friend has an old Q ship in need of most of that suspension/brakes/steering stuff. The cost of rear struts was phenomenal, something like $1400 installed since there are some specialty tools. He just can’t make fiscal sense in rebuilding the entire car due to prohibitively expensive parts. That was my experience with a Nissan pickup too. I spent more on parts(jobber price)and machine shop than a warrantied SBC crate engine would have cost. If I could have gotten a decent size radiator in that thing it would have been a V8 in a hurry and I wouldn’t have had to worry about head gaskets in 140,000 miles either. Once I spoke with several people who owned Nissan and Toyota 4 cylinder pickups it was just a known thing(not to me)they were going to start bucking and wheezing and you tore them down as soon as possible to replace the head gasket, no mean feat in itself, much easier to replace both on an SBC. They were not good to drive hard in Texas heat. The old guy who putted around with no a/c might avoid this problem but putting around and no a/c didn’t compute for me. I ran that pickup WOT almost all of its life. That’s because it had no power. I stay with things now that sell a lot of units so there’ll be plenty in the wrecking yard with good parts.

          • A good V8 from the USA will fit in most things. You only have to find the right V8 for the job. If a sbc won’t fit try a Ford Windsor. They are really compact (they’ll even go into a Miata).

        • Holy shit! That must have been from the dealer, huh? I used to get aftermarket stuff from IPD – less than half of that price.

          Was the one you did a Euro? The ones here were no larger than 2.4l I5.

      • My wife had a 740 that we gave to a poor family with 330,000 miles on it…what finally killed it was them getting smashed by a 4×4 from the rear a few months later.

        The 850’s were the last Volvo’s that you could work on/diagnose without proprietary stuff…when you have to take a trip to the dealership you get hosed(which started with the proprietary OBD stuff on the V series and up/newer).

        850’s and older models are pretty affordable so far by my experience and have a decent aftermarket for parts cost/availability.

        I’d love to find a P1800 in the shooting brake style, but their value is skyrocketing.

        • Hi Nick,

          Believe it or not, I like old Volvos. They were – as you well know – very different from today’s Me-Too-BMW-Benz-Audi-Lexus Volvos. The old ones were built like tanks and while slow, would go almost forever. I can get behind that! 🙂

        • Getting run over from behind is sometimes one of those readily avoidable things, sometimes not.

          I was run over from behind being the last vehicle in line stopped for road construction. Another rig ran over me, ran right up the ramps on the dovetail trailer but swerved off before riding up some square concrete tubes, the end pieces of a square culvert. That KW could have made a clean sweep of my cab so I felt mighty lucky.

          A year or so later I was headed into a construction zone in rush hour oil field traffic that reduced to one lane. I had gone around a tri-axle Mack pulling a lowboy with a big Skytrack on it. He’d been hauling ass when I passed him but I was doing over 80 and told myself I was fucking up going into that stuff with him right behind me. Everybody stands on their brakes(inevitably, somebody will get to a point in that construction where it curves and shut it down creating a dire situation behind them. There had already been countless wreck there just from an idiot standing on the brakes and nearly every vehicle on the road, bumper to bumper doing 75-80 and some well above that, were light trucks to rigs with a dozen or more axles. Well, it happened just like it always did and I was keeping my eye on that Mack and he was watching things close so no problem. Then everybody tears off again, just like nearly every time during rush hour and once again, stands on the brakes and this time it’s even tougher to slow down fast enough and I saw the Mack driver hadn’t seen it right away. Then I saw him lock up his brakes and I knew he couldn’t slow down in time to not run over me so I just went through the cones into the construction(no vehicles or people out there)and he slid past me smoke boiling off tires. I’m sure he was thanking me for not getting run over but he had his hands full to not run over the next pickup in line. If he’d run over me, he’d have been screwed but truth be known, I would have blamed myself as much as him. He shouldn’t have been so close but I knew and he probably did too that some idiot would keep slamming on their brakes till we were out of it.

        • Hey Nick. Nice to see another brick fan!

          We had a 1994 850, too. It was a really nice car – I should have kept it (seem to say that a lot – hmmm).

          The 1800 is really cool, but as you say, really spendy. Check out this from BaT. $28K???? Too rich for my blood.

          • I’ve seen some decent P1800’s in the shooting brake(wagon) style in decent shape go for around $12-15K range- but it’s still a bit much for a daily driver(which is what I need right now).

            Maybe once the kids are grown and I can afford to have a classic around for weekend/occasional driving- but like the others above I like the older air cooled 911’s- thing is, by the time I’m ready to drop money on one they’ll probably be untouchable price-wise(10-15 years or so).

            I like Ferrari 308/328’s too, but same thing going on there.

            • boss had an old P1800. His wife drove (w/o a fan) for several years, then gave it to her son in NYC. stolen, just like the Integra she gave him after that.

  13. Glad I could be of service! Yes, that $895 AC bill on my (free) Audi was certainly a wake-up call! He said it was the blower motor or something. Ok. Whatever.

    Not being a car or gadget person myself (waits for tomatoes to be thrown my way) I don’t really care about most of the features anyway. I find them distracting, for the most part.

    Just give me heated/AC seats, remote start if possible, a power source for phone charging, and an auxiliary jack so I can listen to Eric Peters on the Tom Woods show while I drive to and from work and I’m a happy girl!

    Thanks for the swift reply and for the article! Looking forward to spending more time here. Eric makes learning and reading about cars fun!

    • Well, I’m a car person who hates gadgets, so there won’t be any tomatoes from me!

      Just give me heated/AC seats, remote start if possible, a power source for phone charging, and an auxiliary jack so I can listen to Eric Peters on the Tom Woods show…

      All of those things are available as aftermarket accessories – and they are cheap! Find a good car, write a check and accessorize to your heart’s content!

  14. Fantastic subject, eric. Even better than the $35K new car, though, is the Certified program that most (all?) manufacturers have. You can get a great warranty and let someone else take the first depreciation hit.

    There is also a huge sense of freedom by going the more conservative route. When you vehicles are paid for, even ‘unexpected’ repair bills are really no big deal. If you are already shelling out $500-$700/mo, a $1,000 bill is insult to injury.

    The best part of trading down, though? Having extra money for fun old cars and motorcycles, neither of which depreciate much at all!

    • I won’t say that CPO is a scam, but it’s not what a lot of people think it is. First off – all the makers are competing as to who has the longer inspection list. “Well, we check 173 items” “Pffft. We check 231 different items”.

      Does the guy with his name embroidered on his shirt check all that? Nope. He gets paid the same whether he does or does not. He’ll check some safety related items and then pencil-whip the rest.

      About that warranty – They usually don’t cover everything. And they’re from the manufacturer, not the dealer or a 3rd party. GM hasn’t set eyes on the car, so they don’t know – they’re playing the odds that it’ll last longer than 24 months before needing something expensive.

      Get the non-CPO car, but have a trusted mechanic look it over first.

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