As you have probably heard or already know, the average price paid for a new vehicle is now about $50,000. You may have also heard or read that almost 20 percent of new car loans exceed $1,000 per month. It pays not to buy into that.
But how much does it actually cost?
I decided to see – using my ’02 Nissan Frontier (which I intend to keep for as long as possible) as the basis for the estimate. Right now, the truck is in great mechanical shape and so it costs me next-to-nothing to not buy into a loan on a new truck, – which would cost me a minimum of $31,900 (plus interest) for the least expensive new truck on the market, the Chevy Colorado. 
With only about 150,000 miles on the clock, I’ll likely get another 100,000 miles out of my truck before it even needs a major repair – such as a new or rebuilt engine.
Well, how much would that cost? Right now, according to a search online, I could buy a rebuilt engine for my truck for about $3,400. Used ones with low miles and many miles to go are available all over eBay (or at your local salvage yard) for $2,000 or so. Either way, it’d be less than four months of payments on a new truck to buy a new/good used engine for my truck – and the payments on the new truck don’t end after four months. Even adding in all-new accessories – e.g., water pump, alternator, power steering pump and fuel injectors, etc. – the grand-slam total for a replacement engine for my truck would still not cost as much as one year’s payments on a new truck.
Even if I had to pay someone to do the install.
Of course, there’s still the transmission to think about. My truck’s got a manual five-speed. It will need a clutch at some point but with careful driving and attentive service, the transmission could easily last another 20-plus years. But if not, what would it cost to replace/rebuild it? eBay had several available for about $1,000 or so. If you had to pay a shop to do the install – which is not difficult, by the way – it might cost another $1,500. Pocket change relative to what it costs to make seven years of $1,000-per-month payments.
Pocket change relative to making those payments every month for just one year. Think about it – as the weirdo owner of the military surplus store told Michael Douglass in Falling Down.
Eventually, at some point, the truck will need suspension work – but there’s not much work to do because my truck’s suspension is simple, which used to be typical for trucks because that’s one of the reasons why people used to buy trucks. Simple often correlates with durable and durable equates to not having to spend much or very often.
The truck has a cast-iron solid rear axle, which has no moving external parts. Inside the pumpkin, there’s a ring and pinion and some races and bearings that may, at some point, need attention. But if you change the lube out every 30,000 miles or so (as I do) the internals will usually not cause you any headaches for at least 300,000 miles of service. Even if they do, a rebuild of everything ought not to cost you more than about $1,500.
You will at some point (maybe after 30 years) need new leaf springs in back and coils up front, plus the shocks and a rebuild kit for the steering linkages and some new bushings/ball joints for the A-arms. Budget another $2,000 for all of that, plus the labor, if you have to pay for that.
Are we over $10,000 yet?
Keep in mind that most of the above almost never has to be paid for all at once.
This is a really important thing to understandUnlike that new car payment, which you’ll have to make every month for years until – at last! – the thing is finally aid off. By which time, of course, it’s no longer new or covered by warranty and has accrued miles and wear-and-tear and likely will soon need repairs, just as if you’d kept (and kept up) your old vehicle.
It is true the old car (or truck, in my case) will inevitably need this – or that – but only irregularly and occasionally and if you plan ahead for the need you can avoid having to finance any of it.
Most of these irregular and occasional expenses will be trivial in relation to the $1,000 per month that almost 20 percent of new car buyers are making and if you aren’t spending $1,000 every month on a car payment, how much could you save up over as little as three or four years? Putting aside even $300 each month for three years would allow you to save up nearly $11,000 in cash – enough to pay for a new engine for my truck, plus a rebuilt transmission and most of the rest of whatever might go wrong over a lot longer span than three years. The odds are very high that most of the things that might go wrong won’t – which means you’ll probably still have most of the money you saved – as opposed to the absolute certainty of having to make that monthly payment.
Meanwhile, I’d have a new truck – mechanically – that’s probably not going to cost me much beyond the usual incidentals (oil and filter changes, brakes and tires, coolant flushes and so on every now and then) for another 20-plus years, which is how long my truck has already lasted with almost all of its original parts still in good working order.
And the best part is it won’t nag me or spy on me or try to “assist” me, either! I was able to add a modern stereo without glitching the computer. I removed one of the two catalytic converters and the “check engine” light didn’t even come on. There’s a throttle cable instead of drive-by-wire. And there isn’t an LCD display in the house.
Of course, it’d be nice if we were able to buy new vehicles that didn’t cost twice (or even three times) what something similar used to cost. But until we’re allowed that option again, keeping what you’ve got going seems like the best option.
. . .
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Whose Life Is It Anyway?
self-ownership is at the core of liberty
https://libertypen.substack.com/p/whose-life-is-it-anyway
I made a 2000 dollar car payment today and now have a Jeep Cherokee.
Well, the two grand was mine, not anymore, and I gave away the Jeep Cherokee to a worthy driver, a new owner.
You help those in need by being a Good Samaritan, however distressed they’ve been, can’t ignore those in need, always some hope in the real world even if it is sullied by the likes of Bibi and Trump.
You can look forward to the day that both are gone.
Rejoice, hallelujah!
Not really, I want my money back, whether or not I get it, I’ll keep my fingers crossed.
The Jeep will outlast them both.
Netanyahu and Trump both think they aren’t going to die, don’t want to think about it at all.
The bad news is that they are both still alive.
The good news is they will die one day, just not soon enough.
A Jeep Cherokee is a desirable vehicle, demand is there.
Nobody wants to be in the company of Bibi and nobody wants Trump as president, fake and gay as it gets.
Take it all someplace else, get lost.
Off yourselves, save humanity.
Costs nothing.
I have a 2006 Honda Pilot with 285k miles on the clock that I bought in late 2021 with 200k on the clock. I got it for $4300. It has not been a cheap car to maintain, but it has been a good car nevertheless.
I had teh following replaced at various shops:
Timing belt
Shock and Struts (I spent more than I should have on that due to enlisting a mobile mechanic; took to a shop. I did the shocks myself.)
Control Arms
2 alternators
Air Conditioner (compressor/receiverdrier, condensor)
Tires – 2x (still on my second set)
Wheel bearing and rear axle
I did the following myself:
Plugs/coils
Rear suspension stays
transmission cooler
headlight buckets
sound insulation (dynamat, mass loaded vinyl, closed cell foam)
brakes
transmission fluid changes every year
oil changes every 5000 miles
All totaled, I probably have around 6k in it in addition to purchase price. Still cheaper than a new car and it rides and drives out very well.
I trust it to cruise at 90 mph all day in 100 degree weather, though it likes the gas. I keep it under 85 most of the time.
So, you might ask why do you drive a Pilot so fast? Answer? It’s not what you drive, it’s how you drive it. That applies in any age.
Eric you are in good company.
Back in 1974 Mike Lamm, Motor Trend’s “Used Cars” columnist, after looking at prices of new 1974 models, took a then 10 year old Dart 270 station wagon and refurbished it to like new, then compared it to the cost of a new one.
The Dart won and I have never forgotten the lesson since.
The next influence in my attitude toward debt and cars was a book called “Why Trade It In?” from 81-82. It warped me. The concept of pre-emptive maintenance took root and blossomed.
My only concern these days is the low quality of the replacement parts in the supply chain. Too many times I have had to replace AC compressors, motor mounts, CV joints at perhaps a few months and at low mileage….
Perhaps poisoning the parts supply chain with junk will be just the elbow in the ribs to persuade us all to give up on our cars and get a $70,000 golf cart
The replacement part supply is a problem. I’m a Toyota owner and they have obsoleted parts for 1990s and first gen Tacoma trucks, so anything pre-2004 is difficult to find from the dealer. The 2005-2015 trucks had a long run so should be good for a few more years if they hold to their pattern of about 20 years from the end of the run.
The aftermarket is the problem. Even traditionally decent NAPA parts are getting cheaper, nevermind the low end. If a Duralast part lasts 3 months it’s a miracle.
I think the problem is the market isn’t there for long term, decent quality parts. Too many people don’t view ownership long term where you’d buy and repair. So when they’re newer they go back to the dealer and they continue to do this until they replace the car. When it’s sold it’s to someone who is likely only interested in the bottom line, keep it running as cheaply as possible. We all have probably had those beaters but it would a car you bought for $1,000 and it’s the one taking the parking lot dings. Now most cars out of factory warranty are treated like beaters. I don’t blame shops for the most part. They’re squeezed. Their labor rate has to be high to keep the lights on and if they can shave a couple hundred on parts it keeps the quotes from giving your customers a heart attack.
So the middle market is shrinking, not much interesting is doing things well, doing a repair that lasts more than 12 months. It’s very frustrating.
The upside is if you do persist and keep your old truck running long enough for it to become collectible the market picks back up. My truck was made in 1989 as a 1990 model year and there’s more options coming for sheet metal, interior parts, engine parts that were no longer available. It’s a collectible market so expensive but at least the parts are high quality.
Now see if you can do the same calculations a 2025 model Cybertruck owner will likely face in 2045!
Because, you know, as per the EV fanbois’ claims that EVs are ‘low maintenance’ and ‘cost of ownership is much cheaper than ICE vehicles’?
(Yeah, I know – all such battery devices will be Long & Gonski by that time!)
Well, kind of like the ammo thing, they’ll just fuck you from a different direction. Insurance, inspection, registration. Uncle Scholmo never quits.
Eric
Do you want to sell it, as my grandma use to say don’t ask questions you know the answer to.
Your truck is appreciating not the other one.
Morning, Nova!
Nope, not for sale. I regret that I sold my ’98, which was the same except it was 4WD, which I miss sometimes. But I really miss having a spare.
My ’98 Ford Ranger is inching up on 300k miles. There are minor repairs to be made here and there, but it’s still running strong, and whatever I have to do, I’ll make it run for another 300k miles, by the gods.
As an aside, I dig the bizarre AI-generated truck in the title photo. My guess is you get in via the bed? There are 4-door and 2-door trucks, as well as regular and extended cab. This one is of the 0-door, quarter-cab variety.
I had a 96 step side Ranger. 5 speed, 6 cylinder, 4 wheel dive. Had it for seven years, bought it brand new. Sold it with pretty low miles because I had three other vehicles, [stupid me]. Once I sell one of our convertibles I’m going to be in the market for another Ranger. It was a really solid little truck. And, by the gods, I plan on rolling with the next one until the end.
Sad, Norman, but hopefully you’ll find a good deal out there somewhere. They’re ever more a rarity, but still can be had now and then. Mine’s a 5-speed, 6-cylinder, 4WD as well, though the 4WD needs repaired. As Eric’s articles have detailed, that’s an almost, if not completely, impossible combination of features to be found in today’s trucks. So good luck in your search!
Mine was a step side, even harder to find. If I’d known what a unicorn it was shed still be mine. I see them w/o the step side from time to time on CL and ClasicCars.com. Much more expensive now. For a decent one with 1OO-2OOK miles, the way I want, we’re talking 8-15K. Still a bargain when compared to new.
I drove mine from Bill Williams to Swansea one time. 25 miles of some of the nastiest road I’ve driven. The Ranger handled it there and back like a champ.
wow -an electric vehicle that makes sense…
https://www.tiktok.com/@simon.inchina/video/7510252044171627798?_r=1&_t=ZN-8xnq8olO0bm
I will say that’s all pretty decent for $320.
Now, can someone make an electric car with a 200-mile range, highway speed capability and a 400,000 mile life for $10,000 or so? Some people will put up with the charging difficulties for such a vehicle. If not, EVs will always be largely confined to the electric bicycle category, given a free market.
Given the materials required for the battery, and the extensive mining & processing operations associated with procuring them, it is extremely unlikely that such a vehicle could be produced without subsidies.
Ever since the early EVs back in the 19th century, there’s been ongoing chatter about the ‘next-gen’ battery that’s cheap, doesn’t weigh a ton, has energy density comparable to hydrocarbons, doesn’t catch fire spontaneously, charges quickly, etc etc.
It’s been ‘a few years away’ for 100 years plus. The one difference now is that we don’t even generate anywhere enough electricity, nor do we have a suitable transmission system, to be able to charge a meaningful number of EVs at the same time. And that’s not going to change any time soon.
And given the chemistry that such a feat would require, it will be ‘coming soon’ for the next 100 years, too.
I like keeping cars as long as possible. I’ve had 3 go over 20 years (not sequentially, I’m not that old!). I’ve done all the stuff Eric mentioned – engine rebuilds or replacements, suspension refreshes, transmission rebuilds, clutches. Yes, they’re expensive, but they make your trusty old car drive much more like a new one, and it’s cheaper than buying new.
I’m at a crossroads with one of my cars, my wife’s Subaru Outback. Mechanically, it’s perfect. It drives great, it’s got a primitive 6-cylinder boxer engine that’ll go forever, there’s no rust, and we drive this thing in blizzards in the sierras, it’s unstoppable. Sadly, the interior is starting to get ugly. Subaru plastics, particularly the dashboard, don’t do well in the sun, and the cheapo leather seats have torn in places. Do I dump more money into the interior, or just let it rot? Seats can be reupholstered, but there is no good way to fix a dashboard, it’s a replacement. A new one can be had for about $1,000 but this is a big job to replace.
Depends on how you want to be seen. I redid the outside of my old truck, but the interior shows 40 years of wear- ripped seat, cracked dash from UV. Living near Chicago, I believe it helps scare away car thieves by not looking too valuable. Functionally its fine
Can prolly find some kind of a dash cover but look into Carhartt seat covers. They are nice and tough.
I have been using seat covers, pet hammock, center console cover, etc and the interior of my 13 year old truck still looks brand new. I certainly cannot say enough about the wheelskins leather steering wheel cover, it makes driving a luxury.
Worst case, in today’s money, a new interior may cost $2500. That assumes $2k for the dash and 500 for any upolstrey repairs. OK. Maybe $3500 max. These are lazy man’s figures. I would still put the money in it if it prevents you from buying a new car or someone elses used car problems. At least you know what you have.
Drove the 1991 Silverado yesterday. 188k miles original 350 V8 runs perfect, TBI fan here as is Eric a simple system that just works year after year. One O2 sensor that is very easy to replace from above. Trans was rebuilt 12 years ago (horse trailer towing in the ‘90s took a toll). Money well spent, about $3500 all in including a refresh of the rear main engine seal and replacement of the intake manifold gaskets. I replaced the AC with a 134a system 10 years ago still works just fine. It’s a blessing how much car cost I’ve avoided by keeping the old stuff going and frankly without sacrificing reliability or looks. The truck still looks really nice inside and out.
Everybody drives a used car. How long is it really “new”?
Then how well is it cared for? In Western WA the perverse garage culture is everywhere. It’s wet 80% or more of the year, yet a car or truck sits outside rotting in the rain, every window seal turns green with algae while fir tree needles invade the cowl intakes, fender gaps, body drains. Why? The garage is full to the rafters with useless junk they’ll never use. A coworker from CA couldn’t believe it “your 30k car rots outside while useless junk stays warm and dry in that two car garage, what is wrong with you people??!!”
They’re married!!!
What does a divorce cost so much……because it’s worth it.
Why(fuck auto correct)?$&&@@&$$
Divorce is a very efficient destroyer of wealth, [for males, that is]. Fortunately I learned that lesson early on.
Ha, there’s truth in that! My garage isn’t full of useless junk but we can only get one car of two slots in it because the other bay is tool boxes, welder, work table, a motorcycle. It mostly stuff to keep the cars running and to support the work I do to support myself (not a corporate stooge). Maybe eventually the real estate market will correct but we’re still young(ish) and building our nest egg. That we are even trying to own a house at all is unusual in our circle of friends, the majority still rent even as we get into our 30s. I have a truck older than me and many of my tools, too. My father instilled a value in durable things. Buy once, cry once he says. I don’t always buy something old, it’s not possible to practically sometimes. But before I plunk down for crap at Harbor Freight or unload my wallet at Cornwell or Snap-On I make the effort to cruise pawn shops, yard sales and eBay looking for something worth spending money on.
I’m with Eric!
https://ibb.co/N2hzW5cZ
Don’t need no stinking car loan..
The entire paradigm of auto leases/purchases has adapted to the entirely debt based US economy.
Listen to the mantras of the EV peddlers who – when questioned about long term battery reliability – will say “but its warrantied by the manufacturer for 10yr/150k miles….there’s no worry!!!”
This is further enhanced by all the aftermarket warranty companies that have popped up in the last decade or so. “If your car is newer than 35 years old and has less than 750,000 miles on it, you may be eligible!”
Per the example of the Nissan Frontier provided in the article, just last week Nissan announced that they are recalling over 440K of their VC Turbos. These companies only build this junk to barely make it out of warranty – and they are not even succeeding at that.
Longevity is ZERO priority.
To be “out of warranty” with your vehicle is now the same as being UNVACCINATED!!!
Flip wrote, “The entire paradigm of auto leases/purchases has adapted to the entirely debt based US economy.”
This has been true for a long time. Just as the retailer Rooms-2-Go is a finance company that deals with furniture, car dealers are finance companies that deal in vehicles.
About 10 years ago I was in radio ad sales. They hired a new chick and because she was into drag racing (I was road racing with SCCA) the [female] sales manager thought she could get car dealers to buy time by talking racing with the ad buyers. I started to laugh and the looked at me dumbfounded. I tried to inform them that the last people who are “car guys” are the folks that work at dealerships…except for the techs in back. I’d already pissed up that rope and failed. However, I don’t look like Amy Yazbeck, she did. https://tinyurl.com/4a5u9sz5
Exactly. The “you’ll own nothing and be happy” didn’t start with Klaus at the WEF a few years back. Been a long time coming.
GENERAL Motors going bankrupt proved that fact when the ONLY division that was profitable (at the bitter end) was GMAC. As the story went, GM devolved into a finance company that had a small side-gig building cars.
Where does that magical loan $ come from? When you take out loans you are stealing from your neighbor in what we call expanding money supply. Would you lend me 110 k at 0%-1% ?
So how can Gov-Co?
I agree with all of this, and have done it myself — but only to an extent. I had a Dakota I paid $1900 for and drove it for ten years. When a bearing in the manual transmission went bad, I didn’t swap the transmission — I fixed it and put it back into service. Cost me about $200 to fix. It still rant great with 200,000 + miles on it. But eventually after 20+ years rot caught up with it.
I have a Ford I am replacing it with that I bought for $2000 with a blown motor and am 99% done fixing up. Hopefully I can drive that for 10 years, too.
Thrifty, budget-conscious people can and should be able to fix up old vehicles, but there is no substitute for decent, simple, affordable new vehicles, paid for in cash. My fixer-uppers and winter trucks are around-town vehicles, not cross-country drivers, nor funeral and wedding transportation. Having a daily “beater” for mundane, local tasks like getting groceries helps preserve newer vehicles from mileage, deer hits, road salt, parking lot dings, etc.
But this is not Cuba and fixing up old cars should not be a permanent solution to our transportation needs, it should be a supplement.
The problem with “buying-in” is that the Big Three are basically adjuncts of The State. The System is designed to fleece you and keep you in perpetual debt servitude and regulatory control.
How about a policy that is intended to make transportation affordable, convenient, easily available and simple? We once lived in such a country. Even the so-called “Most Evil Man in History” had such a policy with his “Peoples’ Car.”
Why don’t we have it any more?
This is not Cuba…yet…but we’re getting there. Just give it a little more time.
Cuba is ahead of us in this aspect. They hung onto cars that are easy to fix and modify. Nothing wrong with continuing to fix up what we have but keeping even a late 1990s Ford running long term when all the suppliers are gone is tough compared to a 1953 Buick that has zero emissions, EFI, power anything. You can literally fabricate what you need for that Buick with simple tools because the manufacturing back then wasn’t sophisticated. A hobby home machinist has everything a factory did in 1953.
It’s my thought that we need to be saving all the cars with carbs, stick shifts and no electronics we can find. Even if you don’t get them running now having it in your back pocket for future times is a good hedge. It’s rust that’s the enemy but that’s about it. There again, Cuba for the win, they don’t get snow and road salt.
‘You will at some point (maybe after 30 years) need new leaf springs in back and coils up front.’ — eric
Or torsion bars up front, in the case of first gen (1998-2004) Frontiers. They’re not likely to break. But the ride is too soft for my taste. Replacement torsion bars are available with 20 and 30 percent stiffer spring rates:
https://www.calmini.com/detail.php?b=1&m=2&t=2&p=536&n=
One guy on a Fronty forum claimed that the 30 percent stiffer torsion bars didn’t really make a big difference. Hell, make it plus 50 percent!
The other thing that never made sense to me is keeping a loan for the entire term. If I have a debt I pay it off early. Not only does it help with the mythical “credit score,” it also give you piece of mind. Even if you’re only paying an extra $50/month, because it goes right on the principle, it makes a huge difference down the road.
True, RK. However, the last vehicle loan I got was in 2006 and it was No Interest. In that case there is no incentive to pay it off early. I might as well use their money and pay it back in inflated dollars 5 years later.
I just get tired of seeing that money go away every month. In business that’s called “cashflow” and I guess that’s just the price of living, but still feels like past-me screwed present-me and future-me.
Same here. Got a literal zero interest loan on a car once. Had the cash to cover but invested it instead. Ended up making that a slightly positive growth. Even if it was only a few hundred dinero it was more than zero. I didn’t make the rules to the game but consciously choosing not to play only puts you at the disadvantage. Now if the loan has interest and you can pay down principle early without penalty, there’s no reason not to pay it off as soon as possible. But I see no reason not to get the flawed system to work to your favor if you can. It’s the same moral question libertarians try to answer by not taking welfare like Social Security. If you paid into this vaporware fund for your whole career that money was stolen you should try to get some back. Is it perpetuating the system? Yup. By you not taking it are you going to change it? Nope. It’s a Catch-22. You can go broke being perfectly ethical or manage to survive by living in the grey zone.
And, on top of all that, the debt you incur will mean you MUST work diligently or face the prospect of not being employed thus losing your ability to pay your monthly nut. You can’t easily say, “take this job and shove it” and move on to something else.
You are a Debt Slave.
Our entire society is addicted to debt and it starts at an early age with the propaganda of having to “keep up with the Joneses” when we’re children. (thanks Edward Bernays, you SOB) Then you’re supposed to take a college loan and are given your first credit card. Then you’re hooked. In perpetuity.
Morning, Mark!
Yup. One of my Awakening Moments happened the day of freshman orientation at college. There were Master Card and Visa card tents set up, with helpful, smiling people there eager to sign up 18-year-olds who had no income and no jobs. What is wrong with this picture, I thought? And then the light went on in my head…
When I arrived in the dorm there was a plastic bag with orientation materials hanging on all the doors. Basic information like football game schedules, a flier for the student union, etc. But it also contained a credit card application.
Didn’t really surprise me, but still odd to see such blatant marketing right in your face with the tacit approval of the university. When I found out how many of my classmates were funding their education with debt it started to make a lot more sense.
Morning Eric!
Why is it that society disproves of drug dealers handing out free bongs and crack pipes but feels it is OK to hand out free credit cards to children (children because they were raised to be children and not young adults)?
I’ve had ONE credit card for 35 years. One. Paid off in full every month.
‘One of my Awakening Moments happened the day of freshman orientation at college.’ — eric
Likewise for me at an interview with my first corporate employer. They were paying entry-level salaries which seemed astronomical to a poor college student. I had visions of living on a sprawling horse farm, with a barn full of classic cars.
So I asked the engineer who was squiring me round — he’d been there a couple of years — whether everyone felt rich on their generous salary.
No, he said. Your expenses go up with your new higher income — housing, transport, clothing, entertainment, insurance, travel. Most of my colleagues, he said, aren’t saving much, if anything. I was dumbfounded.
But that’s the Americlown way. Just ask Donnie Deficit, whose Big Bozo Bill locks us into $2 trillion dollar deficits forevermore. I need a different planet to live on. 🙁